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Trump says trade deal with China could happen sooner than you think

Initial Trump comments after the memo was released

  • Call with Ukraine leader was a “nothing call”
  • Says there was no pressure whatsoever against Ukraine in call
This comment from Trump is helping to boost the S&P 500. It’s up 6 points to 2972, just shy of the session high.
Gold is also coming under heavy pressure and is down $16 to $1516, wiping out the past two days of gains.

Pres. Trump pushed Ukraine to work with Giuliani, Barr on Biden’s son

Rough transcript of call with Ukraine released

  • Pres. Trump asked Ukrainian presidents Zelenskiy to examine whether democratic US president candidate Biden stopped investigation of company in which his son was involved
  • Trump told Ukraine Pres. “there’s a lot of talk about Biden’s son”
  • if you can look into it…. It sounds horrible to me
  • US has been very good to Ukraine but did not directly mention foreign aid
  • Justice Department concluded Trump did not violate campaign finance laws
  • US Atty. Gen. Barr has not spoken with Trump about having Ukraine investigate anything according to the Justice Department

Tracking Global Corporate Tax Avoidance

40% of multinational profits are shifted to tax havens each year


Source: Missing Profits

 

Globally, about $650 billion in profits are shifted to such tax havens by multinational from all countries. This fascinating research project from the University of California at Berkeley and the University of Copenhagen is an attempt to track all of those tax avoiding dollars, to see which countries attract and lose profits in this shell game.

Missing Profits:

The loss of profit is the highest for the (non-haven) European Union countries. U.S. multinationals shift comparatively more profits (about 60% of their foreign profits) than multinationals from other countries (40% for the world on average). The shareholders of U.S. multinationals thus appear to be the main winners from global profit shifting. Moreover, the governments of tax havens derive sizable benefits from this phenomenon: by taxing the large amount of paper profits they attract at low rates (less than 5%), they are able to generate more tax revenue, as a fraction of their national income, than the United States and non-haven European countries that have much higher tax rates.

US imposes sanctions on Chinese entities for knowingly buying oil from Iran

Pompeo expands sanctions

Pompeo has been driving a hard line on China and Iran. I’m not sure if China sees this as a separate issue from trade negotiations but if the wider question is: Is the US trying to curb and contain China? Then the answer is that every action like this is a push towards decoupling.

China Beige Book says the country’s economy the weakest it has been all year in Q3

China’s economy at its weakest for the year, CBB saying manufacturing, property and the services sectors all worsening

  • lending has increased
  • current weakness in the economy is primarily due to manufacturing
  • drop in exports a factor
  • most of the decline was due to “considerably slower sales price growth
Bloomberg with the report.
China Beige Book adapts methodology used by the U.S. Federal Reserve’s “Beige Book”
  • It’s a privately produced quarterly report
  • Uses quantitative & qualitative data to track conditions within the Chinese economy

Trump impeachment – White House preparing to release whistleblower complaint to Congress

Politico on the latest, citing ” a senior administration official”.

  • White House is preparing to release to Congress by the end of the week both the whistleblower complaint and the Inspector General report that are at the center of House Democrats’ impeachment inquiry
  • The move shows the level of seriousness with which the administration is now approaching the House’s new impeachment proceedings
Politico on the latest, citing " a senior administration official".

Brexit – Looks like the Financial Times has written the obituary for Boris Johnson’s prime ministership

The FT with a summary of the UK PM’s achievements in office:

In three months as prime minister Mr Johnson
  • has suffered an unprecedented defeat in the Supreme Court, 
  • lost his parliamentary majority, 
  • expelled 21 Tory MPs, 
  • seen the resignation of his brother from the government, 
  • and had his Brexit strategy torn to shreds.
Link here for more, FT may be gated
The FT with a summary of the UK PM's achievements in office:I’ll bet if I caption this “The new Dumb and Dumber movie looks like a hoot!” I’ll just upset some sad politics folks. Best I don’t.