Mr. Trump let the world know the United States economy is in good shape at the World Economic Forum in Davos. He didn’t talk about Climate change which is the Forum’s main topic this year. Greta Thunberg told her Davos audience countries need to do more to stop the temperature rise, but Mr. Trump said America has the cleanest air in the world.
America’s economy is not in great shape, according to a group of economists who think a recession may only be months away. In fact, those economists think the global economy is on the cusp of a recession. The reason for the concern is the quantitative easing that central banks around the world incorporate to keep economic growth from stalling due to political unrest, the Brexit debacle, debt, the U.S.-China trade war, and the Middle East debacle.
Jerome Powell and the Federal Reserve continue to use quantitative easing to stop the economic bleeding caused by those factors, but Fed members don’t call it that. The Feds pump $60 billion a month into the repo market in order to keep interest rates low enough so banks can borrow from each other without paying a fortune for the loans. The repo market is just one of the weak spots in the U.S. economy. Business investment dried up when the trade war started, and the tariffs hurt the steel and aluminum manufacturing business in the United States.
The phase one agreement isn’t a cure for the manufacturing debacle, according to Wall Street investors. China doesn’t have to buy farm products from the U.S. if Chinese importers can buy soybeans, pork, and other products from Brazil and Argentina at lower prices.
The Chinese government can’t control local government officials who don’t care if they conform to the trade agreement. The United States’ credibility in China is in the toilet. Chinese tourists dropped America off their bucket list. And Chinese investors want to sell their U.S. properties to show their support for the Chinese government.
Mike Pence went to Israel to talk to Ben Netanyahu and Bernie Gantz about Trump’s 2017 Middle East peace plan. Mr. Pence talked about the peace plan in his speech but he trashed Iran and that gave his critics a chance to question the terms of the plan.
Pence critics say the Trump peace plan is dead in the water. The critics believe a Middle East peace plan has to include the Palestinians and Iran. The Palestinians rejected the plan last June, and Iran wants the U.S. to leave the Middle East.