| US Treasury Secretary Mnuchin speaks at the White House
Trump hopes to reach 90 trade agreements within 90 days, and then engage with China as a whole—this is what US Treasury Secretary Mnuchin refers to as the 'encirclement' plan (building a higher wall around China).
The negotiation strategy consists of three major parts:
1) Negotiating with Japan, South Korea, Vietnam, and India, all of which are neighbors to China;
2) Negotiating with Canada and Mexico (led by US Secretary of Commerce Ross), forming a 'North American fortress' that will allow the three countries to jointly resist the 'flood of Chinese imports.'
3) Negotiating with the EU, which is one of China's largest export destinations.
However, this strategy faces many difficulties and is not viewed positively:
· Japan, South Korea (led by Mnuchin): Both countries rely on the US for security but are deeply tied to China economically.
· Vietnam, India: Hope to take on manufacturing that shifts from China, but Vietnam is highly dependent on Chinese supply chains, while India is limited by infrastructure and bureaucratic efficiency, making it difficult to replace China.
· Canada: Has responded to Trump with a 25% tariff on American-made cars.
· EU: There are serious differences with Trump, and the automotive and luxury goods industries rely heavily on China.
According to White House trade advisor Navarro, Mnuchin, US Trade Representative Lighthizer, and Secretary Ross will work together to complete this task, with Trump as the chief negotiator.
The work has already been arranged, and the deadline is July 6.
But Trump's proud 'countdown strategy' is becoming a source of turmoil in the US market:
· First, if an agreement cannot be reached quickly, the market's patience will wear thin; the impact of reaching an agreement in 1 month, 2 months, or 3 months will be different. As time passes, the US market will fall into turmoil due to concerns about economic recession and inflation.
· Second, reaching a trade agreement that satisfies both Trump and the financial markets is a 'daunting task.' Although Trump promotes progress daily, if no agreement is reached soon, selling pressure in the US market will intensify.
· Third, there is uncertainty in the US stance on trade issues; Trump and his top trade advisors have differing views, and this flip-flopping has lost the last shred of credibility.
Even if he can solve the above problems, Trump still needs to overcome the final challenge: his own self-destructive impulses.
'Sell America' deals are being fully rolled out.
Report highlights:
1. Why did Trump suddenly change his mind? A report deleted by Goldman Sachs reveals a significant secret, exposing Trump's bottom line.
2. Exclusive revelation: Tariffs postponed for 90 days, why '90 days'? There is a lot to unpack here; understanding this issue will help understand the market trends over the next three months.
3. Trump has postponed tariffs for 90 days, and we have accordingly released forecasts for the A-shares, RMB, gold, crude oil, US stocks, and 10-year US Treasury yield points for the next 90 days—please do not be surprised.
4. When is the earliest the Federal Reserve might cut interest rates? We found the answer, which is different from what everyone expects.
5. Has the Chinese stock market fully digested the tariff war? Will the US and China reach a trade agreement? Should one buy at the bottom now or withdraw? Here are higher-level insights.
