Market reaction to Trump's China tariffs? DOW crashes over 700 points!!!

I like Gold right now and some gold producers will be stable if there is a downturn (assuming the price of Gold holds up). The thing about these stocks is that if the price of Gold takes a downturn you can sell. There are also some interesting metal and rare earth plays - again these will be somewhat insulated.

As far as the broad market though ... it is no joke that electronic trading platforms are set to kick in on the basis of violation of the long term moving average. You do not want to be sitting in a stock that flirting with the 200 day ma, at a time when the overall market is threatening to break below the 200 day ma.

Stocks are about minimizing downside risk and this situation is like giant pothole that a vehicle does not see. Sure the vehicle might miss the pothole but, you do not want to be sitting in the vehicle during this probability event.

Sure you might miss a little upside .. but you also could miss the downside. At this point the downside risk outweighs the upside potential.

 

Basically no economists agree with these tariffs. We are essentially putting a blockade on ourselves just as we would get the world community to do to North Korea as part of sanctions.

 

I find it funny how many on the left (mostly Bernie supporters) supported protectionism until Trump started implementing it. It was always a dumb idea. Hopefully now everybody is seeing why and we can reverse course sooner rather than later.

 

Big swings up and down last few days. 600 down atm pre-market! hmm

Yesterdays UP partly attributed to dividend payments due to January tax cuts

 

Continued from yesterday's post. The action around the long term moving average in a case like this is always interesting - for a number of reasons.

In a long term uptrend the Dow can touch the LTMA and even go slightly below but, so long as it rebounds off this level (and underlying trendline support which nearly coincide .. the trendline is a bit lower at around 23000 - is not broken)

I use the 210 day ma as opposed to the 200. Why ? because Stan Weinstein uses this one .... God of technical analysis.

http://bigcharts.marketwatch.com/ad...sToggle=false&chartStyleToggle=false&state=10

The dow is now just at this level ...just barely touched but not broken below. What is interesting is the action at this level ... got close .. rebounded yesterday ... and today testing again. The Dow is not going to break below the LTMA without a fight (and this almost always happens .. which is weird but ... thats what happens)

Something else that I have noticed over the decades is that the market will predict the news at certain times. The market moves and then something will happen. We can point to the possibility of a trade war with China ... but, my opinion is that sellers are looking for a reason to sell. I think that in other circumstances this china tariff spat would be largely ignored. There are insiders that have a much better understanding of what is going on with China than you or I .. and they have already place their bets prior to the thing unfolding.

One thing we can be sure of is that traders are freaking out right now. If the Dow can hold here and move back up there will be a collective sigh of relief... and this could signal the beginning of another strong uptrend. If we break below (meaning we close below the LTMA ... and possibly continue downward - this is almost always followed (its uncanny) by a retest of the LTMA (a move back up to the LTMA).

If this retest fails to break above the LTMA - and continues down again this is a confirmed breakdown and this is when you could see some massive sell programs kick in.

Either way - this is a very interesting time for traders.

 

These are early days, and too many people are worried the sky is falling. Ultimately it looks as though these are the opening salvos to a long term agreement to address the imbalance. That's one of the biggest problems with today's progs, they scream the sky is falling at the drop of the hat, and when that hysteria dies down we find that it wasn't so bad or in fact beneficial.

 

Stealing close to 600 billion in intellectual property (which this is really what it is all about) is not a political stunt.

 

Why don't you just call it a trillion while your making up numbers.
If it was a serious effort it would be targeted at companies that steal intellectual property. But understanding trade is hard. Who would ever think that.
Have you noticed how well the steel tariffs worked? Oh wait. China hardly sells us any steel.

 

Steel was just an opening salvo. I guess you have never been to a flea market where you can buy knock off CD's, Movies, clothing, shoes, purses etc. Some of our vendors down here take bus trips to N.Y. to buy illegal merchandise.

 

Knock off CD's and movies - that is so 1990's! Does anyone still buy these

As for those clothes etc, the only difference is the label. For example, Trump's family clothing business (and others obviously before anyone thinks I'm attacking Trump) uses practically the same Chinese manufacturers as the knock off stuff. Those people buying those knock off goods from flea markets would not be able to afford the genuine goods anyway so no trade is actually lost because of the knock-off goods being bought.

 

Tariffs? USA may subsidize Chinese cars

China sells three times as many goods and services to the United States as it buys from us.

Globalists call this free trade. It isn't. China put up barriers to our products, while stealing our technology, and ignoring our intellectual property rights.

We follow the rules. They break them. That's not free trade. That's exploitation.


Donald J. Trump

✔@realDonaldTrump
When a car is sent to the United States from China, there is a Tariff to be paid of 2 1/2%. When a car is sent to China from the United States, there is a Tariff to be paid of 25%. Does that sound like free or fair trade. No, it sounds like STUPID TRADE - going on for years!

3:03 AM - Apr 9, 2018

China will introduce a car to the United States next year.

The Trumpchi.

While China imposes a 25% tariff on our automobiles, our government will subsidize purchases of this Made in China auto.

"The company is also planning to unveil electric vehicles for export to the United States as well as Europe. They’re hoping to benefit from the $7,500 tax credit currently in place for electric car buyers stateside. This would act as a subsidy for them to gain a foothold in the US market," Car and Driver reported.

I trust President Trump will not just say no, but hell no as well.

And impose a 50% tariff on Chinese cars.

http://donsurber.blogspot.com/2018/04/tariffs-usa-may-subsidize-chinese-cars.html#more

 

The U.S. imported 58,000 passenger cars from China worth $1.5 billion last year, according to the International Trade Administration, a federal agency within the Department of Commerce. That was a fraction of the number of cars the U.S. exported to China: 267,000 passenger vehicles worth $9.9 billion.

http://fortune.com/2018/04/09/donald-trump-china-car-tariffs/

Be careful what you wish for.......

 

You want us to subsidize Chinese cars?

I'll take Trump over you as our negotiator!

Xi Blinks, Chi-Com Prexy Promises to Cut Auto Import Tariff

 

I thought the actions on china were over intellectual property. You guys throw out ad hoc explanation after ad hoc explanation to try and defend this obese, stupid excuse for a human. Throw **** at the wall and see what sticks. It must get exhausting.

 

Don't be obtuse. They cheat on trade and they steal our technology, including military technology, to the tune of hundreds of billions, combined, every year.

Trump's finally doing what has needed to be done for a very long time.

 

There is no damn such thing as cheating on trade and every freaking country on the globe steals everyone elses tech. You guys will wake up. Eventually.

 

Good, that must mean Trump actions can't be cheating.

And we have a right to impose a price on that theft, Silly!

 

Who said trumps actions were cheating? They are stupid but not cheating.

 

You said there cannot be cheating in trade, so Trump cannot be cheating.
How is my affirming your position that Trump is not cheating, a claim that someone thinks Trump is cheating?

Does stealing our technology, cheat us?

 

I never claimed anyone was "cheating". My only claim was that trumps penchant for the tariff is stupid and harmful. It's not like I'm going out on a limb here either, history is replete with examples of how this movie ends.

 

Is stealing our technology, cheating us? It's a very simple yes or no question.

We had 12,000 tariffs in place before Trump took the oath. Were they all "stupid and harmful"? Can you direct me to your posts voicing your opposition to them?

 

Everyone is trying to steal intellectual property. That means us too.
And yes, I am and always have been very much against any and all tariffs. I'll leave it as an exercise to you to find any post of me in favor an any protectionist policies.

 

Is it cheating to steal from another?
Is it unjust to impose a price on those that steal from you?

 

So what was that bullshit about cars then? Try to stay consistent.

 

Try to focus....
Is it cheating to steal from another?
Is it unjust to impose a price on those that steal from you?