“I’d Tax Every Benz,” “It’s A Corpse That Still Moves”: Are You Getting The Truth On Trade?

“At the same time, tariffs would weigh on US growth. If we assume that Mexico and China retaliate with equivalent tariffs, this would substantially reduce demand for US exports, depressing US GDP by around 0.7pp by 2019. In fact, tariffs would likely hit US GDP so sharply that the Federal Reserve would be prompted to reduce interest rates to cushion the blow—despite an increase in inflation.”

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Traders, Analysts Are Pissed: “At Some Point, Everyone Is Going To Realize The New Emperor Has No Clothes”

“As analyst notes flow in to investors’ inboxes during the next 24 hours, asset prices may start reflecting a far more negative outcome. Beware downside moves in the dollar, in U.S. yields, and even in equities. At some point, traders may realize the new emperor has no clothes.”

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