Deal Or No Deal?: There Will Be No China Trade Agreement- And No Certainty- By NEIL SISKIND

If you’re making certain business and investment decisions with the hopes and expectations of a U.S.-China trade agreement, I’d urge you to curb your enthusiasm, as follows:

  1. We won’t be executing any “trade agreement” as you know one- meaning, a preferential or free trade agreement between or among parties in order to reduce (or eliminate) tariffs, quotas, and other trade restrictions on items traded between the signatories; where both, or multiple countries, loosen their trade restrictions to help out businesses so that they can prosper better between the different countries. This one-dimensional definition does not apply to the multi-dimensional U.S.-China problem. Neither party is particularly interested in helping cause the other to prosper.

The low or zero tariff rate in a true “trade agreement” are not contingent on one party making structural political, legal, and economic changes to the satisfaction of the other. A trade agreement has tariff rates (or zero rates) that are fixed and final (unless one country violates its tariff rate or manipulates the sale(s) of a category of products or of an industry to benefit its own countries’ companies and/or industries).

We don’t have an existing “trade agreement” with China. It’s not like NAFTA, where we have to replace an existing agreement. Our “agreement” with China is this: If you stop violating international laws and accepted global trade and financial practices, and prove it, you can regain access to our market, without tariffs. It’s no different than the trade agreement offered for the past year, which China has refused. There’s no reason for or benefit to the U.S. to enter into a trade agreement with China. China doesn’t honor terms, laws, or obligations. With China in violation of international laws and global trade norms and practices, and no apparent internal desire to change, we have no reason to, or benefit from, a trade agreement with China.

  1. The term “trade war” over-simplifies this dispute. This dispute’s inception was not one nation’s implementation of tariffs and barriers, or the use of subsidies or dumping, to protect a market or industry, followed by another nation’s in-kind response. It’s true that a “trade war” is one nation’s significant protectionist actions or policies met by another nation’s countervailing actions or policies. But, China’s practices are not just to protect a product or an industry, but the use of a mercantile approach, and illegal activity, and oppressive terms, to protect the entire country and close-off access to all industries by either limiting foreign ownership and requiring IP disclosures and transfers in exchange for access. This goes far beyond trade protections. China has been operating in an unacceptable manner in contravention of global practices and acceptable legal and commercial standards for many years. This is more than a trade war and tit-for-tat tariffs. It’s a broad strategy by China to steal property, circumvent laws, and unilaterally benefit from general market access which China, itself, denies, in all respects, to others. Just by virtue of subsidizing private (or supposedly private) companies in China, China is violating the very spirit of international trade and trade agreements in the most fundamental of ways. This practice is counter to the entire purpose or usefulness of trade agreements for any other country. Our tariffs on China’s goods are more like sanctions for practices and behaviors contrary to accepted global trade and international laws. It’s like China is being punished for breaking the law, and then being put on parole. Theft, corporate espionage, economy-wide subsidies, forced technology transfers, forced joint ventures- things that go beyond tariffs and single-product or single-industry protectionist trade barriers are at play.

There are barriers to operating in the Chinese markets that affect all aspects of commerce, law, trade, and monetary policy. Our disagreements and disputes with China should never have been labeled a “trade war” by the media or by the White House or Congress. This is an all-out disagreement about cultures, values, laws, and economic and political structures. We are at war with China in every conceivable way over every conceivable issue, which has led to tariffs, counter-tariffs, and a “trade war” as a symptom, or result of the differences. The tariffs on China are in response to all of our grievances, and are not just tariffs in response to tariffs (or other industry or product-specific measures). If you add in theft, espionage, currency manipulation, trade route military tensions, and tensions over geographical control, such in over Taiwan and North Korea, China is as much an enemy of the U.S. as is any other nation we consider to be an enemy.

When you look at the situation through this lens, you see why we can’t expect a typical, or easy, or immediate, resolution, as you might see in a “trade war”, but, rather a solution that is more multifaceted and multidimensional, and multi-year, in nature.

  1. If China really wants a trade agreement, and truly plans to change, why show up at the G-20 entirely empty-handed, even with tariffs in place and with new tariffs being threatened.
  2. Allies enter into trade agreements to expand and guaranty free trade relationships. Adversaries do not enter into trade agreements as a way to resolve animosities and differences. Disputes are not settled with trade agreements. Trade agreements, like any other agreements, require signatures- but also mutual respect and trust … and these elements do not exist between the parties.
  3. I take President Xi Jinping’s recent comment related to nothing interfering with its determined policy on Taiwan as a strong warning to the U.S. “Foreign interference in China’s Taiwan reunification issue is intolerable”, Xi said. There are more than tariff and economic issues separating the parties, including tensions in the South China Sea and a struggle for power and influence over North Korea.
  4. So- if we make no trade “agreement”, what about a trade “deal“?

It depends on what you consider a “deal”. A real “deal”  has “certainty” and “finality” of obligations and expectations. A temporary “deal”, or a “deal” with conditions and contingencies that go beyond one party must act to obligate the other to act, lacks “certainty” and “finality”, and is not good for businesses. There can be no permanence, and, thus, no certainty for businesses (and for investors) if a deal has numerous and complex unilateral requirements that take months or even years to prove. That is not much more than a punch-list of items that are hopefully executed on. A valuable “deal” with regard to and for businesses, must have “finality”, “certainty”, in the short or medium terms, and clear rules of engagement, such that supply-side business planning and investment that stimulates economic growth is incentivized and can flourish. A “springing deal”, one that takes effect only if other contingencies are satisfied, is hardly “certain”.  “deal” where tariffs can be re-established if China fails to meet its obligations and convenants of any kind is cause for concern of a lack of “certainty”.

Even if China completely capitulates, in many ways, or even in all ways, there still will be no “final” and “certain” “deal”. Unless the President completely abandons his concerns and principles on China’s trade practices and economic structure, China will have to pay tariffs for access to our market until new policies and compliance begin, and are verified with benchmarks, standards, and inspections. Changed practices, especially on allowing foreign majority ownership in all industries, can only be established through a pattern of many transactions, which, by definition, will require time.

From a legal perspective, a “promise by one party in exchange for a promise by a counter-party” creates a binding agreement. But, from a business planning perspective, without “finality” and “certainty”, such as a deal based on promises to act in the future, rather than on actions that can and will be immediately taken and proven, can it really be said that a useful deal has been made for businesses, one upon which accurate business investments, capex, and quantifiable capital risks can occur?

Ask yourself this: Does it “feel” like China wants to go along with our rules and requirements? Does it “feel” like China wants to be a party to our version of a trade agreement or trade deal? How can you do business with a party that will resent you day-in and day-out for making it act and operate as you dictate?

The more U.S. products that China agrees to purchase, the more persuaded I am that it wants to avoid non-trade related topics or changes. China’s leaders no doubt believe that if they target the Trump administration’s financial sensibilities, they can avoid more significant legal, economic, and political changes as part of a trade deal.

I suspect there will be a temporary tariff deal with China (on, or in 60 days from March 1) where we will lower our impending 25% rate on China’s goods to 10% or 15% with a time frame (1-3 years) for China to alter its practices, while China, immediately, removes all tariffs on our goods- particularly, any retaliatory tariffs- and, immediately, makes an agreed amount of purchases of U.S. products. No greater reduction of tariffs will be made before China completes its promises- and the rate could rise in 1-3 years if China fails to meet its obligations. Any “deal” would be a “China goes first” deal. President Trump will not allow China to rebuild itself through access to our market with the risk that China is bluffing and defaults on its obligations in 3 months, or 6 months, or 3 years, or 6 years. China’s changes must be tested, proven, and certain.

If an announcement comes from the Trump administration that a “deal” has been reached- look beyond the headline print … and read the fine print. You can call something a “deal”, even without the necessary elements and benefits of one. But, just because you call a daisy a rose- it does not make it one. China may never be able or desirous of meeting the terms of a “deal”.

No FAKE DEALS, Mr. President!

7. What’s past is prologue. Since the G20, China has done nothing to show good faith or to gain our trust or show any intention to change:

It has not passed a law to stop its people from mailing Fentanyl to Americans, as promised.

It agreed to implement only a “temporary” auto tariff reduction, and only back to the level where it already wrongly was- and hasn’t even done it.

And, oh … yes …  China bought some edamame from us.

Are these the bases for all our hopes?

8. President Trump has not exactly been solidifying agreements during his presidency: N. Korea denuclearization, China auto tariffs and Fentanyl laws, repeal of Obamacare, USMCA finalization, the full length of a border wall … this president’s track record for finalizing agreements is unimpressive.

 

Some people (in particular, equities analysts and traders and asset and portfolio managers seeking any reason for stocks to rise) think that this is now about optics– and that any sort of positive announcement on the relationship and the resulting good optics will be enough for the markets and for America. Those people would be wrong. This is about revenues, and margins, and the economy. Optics won’t help with business planning and visibility. Stocks can never do well over time without good earnings- which require reasonable levels of visibility into costs, customers, pricing, and supply chain management issues. Sure, stocks might rally on news of “a deal” … but earnings will be the ultimate decider. Anything other than a binary approach- to either raise tariffs to a fixed long-term rate (at least until all required changes are made), or to totally forego any tariffs on China in exchange for certain immediately proven actions- will cause a continued lack of certainty and visibility for businesses.

Keep two thing in mind when your optimism tells you that we may soon have a trade agreement or final and certain trade deal with China:

First, we still haven’t even been able to finalize a trade agreement or trade deal with Canada and Mexico!

Second, the Trump administration can’t even reach an agreement on international issues (immigration) with the Democrat party …

… and you’re banking on one being reached with the Communist party?

 

 

 

____________________________

endnote

China made an enormous miscalculation with retaliatory tariffs to our retaliatory tariffs. Our initial tariffs were in retaliation to years of unfair and illegal trade practices by China, which we have been complaining about for decades, through several presidential administrations. For China to retaliate to our tariffs for China’s activities and practices that we explained and complained were unfair, and to which we were retaliating, was an act of complete disregard for international relations, international law, international practices, and for the interests or concerns of any other nation except for its own. Rather than address our retaliatory tariffs, China chose to challenge us, attempt to one-up us, antagonize us, and create a riff in relations, with the goal of continuing its practices of IP theft, corporate espionage, and protectionism, and ransacking our technological innovations; and China’s economy is paying a price for its leaders’ arrogance and decision to agitate an enemy, rather than cooperate with the world. Perhaps the Chinese leadership needs to re-read Sun Tzu’s advice in The Art of War about understanding the enemy- and one’s self. Or perhaps, in the long run, China will prevail in its long-term ambitions. Only time will tell. After all, Sun Tzu’s strategies are long-term ones that are grounded in fortitude, farsightedness … and patience.

 

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To Be Economical About Economics …

For all the economic forecasts, experts, data, chatter, principles, and analyses with which we bother and over which we debate and ruminate, significant economic declines always comes down to one thing- too much debt; and they always happens at one of the following times: either sooner … or later.
Neil Siskind 

There Will Be No China Trade Deal!- by NEIL SISKIND

First of all, we never had a China trade deal in the past. It’s not like NAFTA, where we need to replace something that we have. We don’t need a “trade deal” with China. The “deal” is this: “Stop breaking the law and defying international trade rules and practices, and then we will accept your products without tariffs”. That is the “deal”. We should not be signing anything- unless China agrees to buy, and then actually buys, a whole load of U.S. products.

Even then, China has to go first. We should not provide access to our markets without tariffs and help China to keep growing until we see changes in important behaviors- which will take months- really, years. We should not allow China to get its footing back, and get itself back on its path of world conquest, just to find out that it isn’t doing what it promised- again. How about: “No trust and verify”.

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 8 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

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Trade: China Is Ruining The World- by NEIL SISKIND

The U.S. did nothing wrong to China. China has had years of protectionism, mercantilism, and illegal behaviors, and has refused and declined to abide by international expectations, laws, and activities related to trade- and has failed to allow fair and equal access to its markets.

The U.S. responded (finally) to these protectionist and illegal activities, with tariffs.

China should have stopped there and started negotiating with us.

This would have been difficult enough for China.

But, instead, it chose to retaliate to our retaliation to their protectionist, illegal, and mercantilism-style activities (after many years of patience on our part)- which showed the world what China really is- a bad actor on the global stage that is just looking for power and trouble.

And now it is starting even more trouble by asserting power over Taiwan.

China is a troublemaker nation. It has no respect for national autonomy- except for its own- and has no respect for law, human rights, being a member of a global community- or anything right or just. It deserves its recent decline- and we are right to stand strong.

China should never have retaliated to our initial tariffs. It was arrogant, greedy, short-sighted, and detrimental to its own goals in all respects- and harmful to world peace.

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 8 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

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You Should Fear An Economy Relying On The Consumer- by NEIL SISKIND

Business investment is weak, many corporate balance sheets have significant debt loads, stocks are crashing, wage growth is still weak while tariffs have been implemented and new ones await, and as interest rates have risen and are still rising.

Analysts point to a strong consumer and a strong jobs market as the bases for a strong economy going forward.

You can’t have demand side stimuli (consumer spending) support an economy, and you can’t have a strong jobs market, without supply side stimulus … not for very long.

This is 2005-2007 all over again- stagnant or slow wage growth, rising rates, low unemployment, high debt levels due to rates being low for long, sinking oil prices, low inflation, and asset (houses and stocks) and debt excesses- except now we also have a trade war.

 

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 8 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

Sponsored Advertisements

Inventors, IP Owners, Manufacturers
Learn How To Bring Products To Market And To Expand Your Distribution Channels
The Complete Guide To The Ways To Manufacture & Sell Your Products

 

Venture Capital Available For Environmental Consulting And Related Services

Up to $10,000.00 equity capital available, plus free legal services (if in N.Y.S.), marketing and branding assistance, and general business management services (for a total venture investment package of approximately $150,000.00), for environmental consulting and planning and related service start-ups (or existing businesses).

To qualify for an investment, upon funding* your company’s objective must be to provide one or more of the following environmental services for commercial, residential, or farming projects:

  • Consulting
  • Advising
  • Testing & Evaluating
  • Planning
  • Government Applications, Permits, And Meetings
  • Conservation And Natural Resource Surveying
  • Soil, Air, Land, Rock, And Water Consulting and/or Testing
  • Storage Consulting
  • Horticultural Advisory Services
  • Project Management And Oversight
  • Natural Resource Management
  • wetland Consulting
  • Wildlife Management and
  • Restorations
  • Regulatory
  • Ecological Studies

Use of Capital:
Capital ideally to be used for sales and marketing and/or necessary equipment.
*Funds will be provided on an as-needed basis for the intended and agreed uses of capital.

Qualifications:
To be eligible for a venture investment, those seeking a capital investment must have a PhD level degree in applicable sciences (or the highest level of degree available in a particular area of science, or be a certified ecologists or geologists). Published work in legitimate and respected publication helpful. Real world experience and references helpful.

Contact Neil Siskind at nsiskind@siskindlawfirm.com to discuss your start-up business or existing company’s needs.

This Fed Could Not Be Any Less Transparent- By NEIL SISKIND

This Fed would have us believe it is operating in accordance with its dual mandate of price stability and maximum employment. It has said as much.

The Fed, though, has a third mandate ever since the financial crisis: Stability of the financial system.

Chairman Powell, in his December 19th testimony, clearly said that he is not concerned about inflation- in prices or in wages- but the Fed continues to raise interest rates.

The Fed would have us believe it feels compelled to get interest rates to a point of neutral, where it is neither accommodative or restrictive. Not true. The Fed wants credit and risk to tighten- to be restrictive on the economy. Former president of the Federal Reserve Bank of New York, William Dudley, made it plain in an interview with Bloomberg’s Kathleen Hays on December 20, 2018, that he believes that the Fed wants to slow the economy- period. Chairman Powell’s comments on the lack of inflation and intent to raise rates, confirms this.

Chairman Powell has failed to articulate one area of concern which makes the continuation of raising rates seem logical- not even any inflation concerns. But raising them as the stock market crashes so that he has cushion if he ever needs it, is not believable; prudent- but not believable.

Here are some comments Chairman Powell has made in the two most recent Fed meetings:

  • No asset class is too pricey
  • There’s little wage inflation and wage growth is not necessarily inflationary
  • Corporate debt is concerning, but not obscene
  • Price inflation is about 2%, at best, and has been stuck there
  • It’s not the Fed’s job to ensure financial stability
  • Labor markets are tight but wage growth doesn’t cause inflation
  • The U.S.-China conflict is not a big concern
  • No comments at all on home prices

The Fed would have us believe it is moving rates higher so that if and when there is an economic downturn, it will have bullets in its gun (or arrows in its quiver) to re-stimulate the economy by cutting interest rates. This is not true. No Fed would hike into slowing GDP growth and a sinking stock market just so it can cut if it needs to “someday”, while it purports to see little inflation or economic that it can articulate (aside from some concern about Italy’s problems).

Some might argue that this is exactly the time to hike rates- while the economy is strong and can withstand it- even if the stock market doesn’t like it. But, with no inflation, and expectations by everyone of lower GDP and heightening global stresses in the coming months, raising rates as cushion for a slowdown without the ability to point to any foreseeable risks, is a bit theoretical and intangible- and this Chairman was supposed to be avoiding theory to the detriment of pragmatism and data dependence. Moreover, it’s not so much that the economy is strong as much as it is that the Fed will not admit any weakness. Powell is trying to have it both ways- raise rates and have people accept it as prudent without acknowledging any troubles- and it’s not working.

This does not mean that the Fed is wrong for hiking interest rates, it just means that it is not being transparent about the growing and foreseeable risks as it does so. The Fed has elected to perplex people, over alarming us.

The Fed has had one agenda with regard to its rate hikes- to slow the economy by tightening credit and deflating asset prices built on debt and risk. No other story line it presents holds up to scrutiny.

This Fed is choosing jawboning and its third mandate over transparency in order to get credit to tighten itself without actual rate hikes, if possible, and get people to stop making and taking speculative loans and investments. This, along with the lack of transparency and a complete understanding of the Fed’s intentions, are causing significant volatility and declines in stocks and in homes. But, the Fed may be fine with that if it can do one thing that matters most- prevent another financial crises due to continued extensions of cheap credit, more bad loans, and more asset inflation.

The Fed has recently expressed some dovishness as asset prices have declined, having much to do with people’s concerns that asset price declines will affect the “real economy”. If this proves true, the Fed may be near done with its hiking cycle. If this does not prove to be the case, per the data, the Fed may either decide to continue with hikes until the economy slows- or it could remain dovish, since assets prices and credit may come under control. We’ll see.

 

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 8 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

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The Fed: Americans Forget About Good Old-Fashioned Jawboning- By NEIL SISKIND

The more that Chairman Powell promises more rate hikes, the tighter credit becomes. This tighter credit, even without actual hikes, can help slow the economy and prevent the Fed from having to even act- or enable it to act to a lesser degree than projected. Let the Fed do its job.

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 8 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

Sponsored Advertisements

Inventors, IP Owners, Manufacturers
Learn How To Bring Products To Market And To Expand Your Distribution Channels
The Complete Guide To The Ways To Manufacture & Sell Your Products

 

 

Prepare Yourself for 2019! The Fed, China, N. Korea, & Trump- By NEIL SISKIND

Here are the major things you should prepare for in the new year:

  1. The Fed is determined to slow the economy. While it may become more dovish and raise rates less than previously expected, this would only be in response to much tighter credit, lower earnings, contracting GDP, and lower asset values. Do not underestimate the Fed’s intent to slow this economy- which does not mean lower inflation- because there isn’t any- but means lower asset values, and whatever that brings with it- including lower profits and higher unemployment. Invest accordingly- now.
  2. As U.S.-China negotiations continue, the relationship will sour further as it becomes clear that little common ground and compromise is possible because our cultures are too divergent, and our respective values too deeply entrenched, causing frustrations to grow. The trade conflict will escalate- no matter how much edamame the Chinese agree to buy from us.
  3. North Korea will rise as a major irritant on the world stage as it seeks to stoke the flames of the U.S.- China dispute and seeks all the benefits it can achieve for itself from the divide. North Korea will present a major threat to global stability starting in the first half of 2019.
  4. The U.S. and China will face a potential military showdown in the South China Sea, which may begin as a potential military conflict between China and Canada, which has been our proxy for actions against China, or over a U.S. military action in North Korea from the air or sea.
  5. We need to now see how this shocking U.S. withdrawal from Syria unfolds in terms of new terror threats- which I believed, and was thrilled, were nearly cured by the President; so, I am not sure what he is thinking. I await more facts. I suspect that a military conflict in Asia is possible (most likely with N. Korea, though possibly also with China over territory issues- not over trade … although all issues with China are connected and inter-related at this point).

2019 is going to be a thrilling and terrifying year of global events from Europe, to Asia, to the Middle East- to the United States. What else would you expect from a real time global version of “The Apprentice”, where everyone is competing to make a profit and to survive and move to the next level before Donald Trump lays down the hammer?

Lights … cameras …

roll ’em!

 

 

Neil S. Siskind, Esq., President
The Siskind Law Firm
Tel: 646.530.0006

Neil Siskind is the Founder & Chairman of The Fatherhood Assignment
Neil-Siskind-photo
Learn more at:  http://www.neil-siskind-the-fatherhood-assignment.org/

Neil Siskind is the Conservator of the Neil S. Siskind Nature Preserve
Neil-Siskind-Picture

The Neil S. Siskind Nature Preserve is over 7 acres of environmentally-pristine waterfront land in a magnificent setting along New York’s majestic Hudson River. The Preserve includes a variety of species of animal and plant life, and is a precious example of the thoughtful maintenance of New York’s priceless open spaces. The land’s uses are limited to outdoor recreation such as hiking and climbing, and the study of ecology, nature and land use. The Neil S. Siskind Nature Preserve allows for the intelligent contemplation of our valuable natural resources and the most effective ways to maximize them and keep them protected.

Neil Siskind, Founder, “National Fatherhood Day” – March 29th

Neil-Siskind-pics
To encourage recognition of the needs of boys and girls who are living without fathers or father-figures in their lives.

Read about the non-profits and charities whose missions Neil Siskind supports and promotes: www.neilsiskindsupports.com
Caring is Free®

You can read what clients and associates say about Neil Siskind at: http://siskindlawfirm.com/neil-siskind-bio/.

Neil Siskind’s Volunteer Work:

– Memorial Sloan Kettering Cancer Center, Volunteer

– Memorial Sloan Kettering Cancer Center, My Fundraiser- Help Neil Siskindhelp children with cancer to be more comfortable: http://mskcc.convio.net/site/TR?px=3182108&fr_id=2632&pg=personal

– Make-A Wish Foundation- Help Neil Siskind make sick children’s wishes come true by creating your own fundraiser: Neil-Siskind/Help-Make-A-Child-Smile.htm

– DonorsChoose.org- Donate to one of my needy public classrooms: http://www.donorschoose.org/NeilSiskindGiving

– Champion Children– We seek to inspire people through stories of children who have overcome challenges: http://siskindlawfirm.com/neil-siskind-champion-children/


Neil Siskind’s Pro Bono
 Work:

– Saving Senior Citizens- Protecting New York’s senior citizens from fraud and financial abuse www.savingseniorcitizens.com

– Senior FreeStart Business– Pro Bono: We seek to help put senior citizens in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– Veteran FreeStart Business– Pro Bono: We seek to help put Iraq and Afghanistan war veterans in the right direction so that they can face the challenges of the modern economy: http://siskindlawfirm.com/free-start-business/

– In development: The Neil S. Siskind School of Hope: A free school to teach inner-city youths the skills of entrepreneurship and importance of economic self-sufficiency.

Neil Siskind’s Government Work:

– Suffolk County District Attorney’s Office, Boston, MA, 1994, Intern
– Office of Senator Christopher J. Dodd, Newington, CT, 1992, Intern
– Hartford County Department of Probation, Hartford, CT, 1991, Intern

Neil Siskind’s Community Assistance:

Financed & operated a legal clinic providing low-cost legal services to struggling Long Islanders during the recession to help clients resolve debt, organize finances, and launch new businesses.

Neil Siskind’s Professional Curriculum Vitae: http://neilsiskind.com/

Sponsored Advertisements

Inventors, IP Owners, Manufacturers
Learn How To Bring Products To Market And To Expand Your Distribution Channels
The Complete Guide To The Ways To Manufacture & Sell Your Products