Always gets the best view ...
President Trump has backed Johnson to be Britain's next prime minister. "Mr Johnson would be excellent in the position", the President said. "I have always liked him, he is very talented". More importantly, "he has been very positive about me and our country".
Boris Johnson remains the front runner in a race which hasn't started yet. Will the Trump support help? The President believes his personal backing offers a great endorsement to candidates. "I am loved in the UK, my mother came from Scotland, I have three golf courses there". Yep, what's not to like!
The Met will deploy snipers, firearms officers, sniffer dogs and 15,000 officers trained in riot control to deal with a potential 250,000 demonstrators traveling to the capital next week. Asked about the leadership election, Trump said, "I have studied it very hard. I know the different players, I think Boris would do an excellent job". Trump also praised Jeremy Hunt, "Yup like him!" Michael Gove ...not so much. Last week, the environment secretary accused the president of sabre rattling over his policy on Iran.
Meanwhile the list of runners and riders in the election race continues to grow. Boris Johnson is the odds on favorite. Michael Gove, is next up 7/2 [Betfred]. Dominic Raab and Andrea Leadsom are both on 8/1. Rory Stewart is moving up the table. Confessions of an Afghan opium exploit boosted his odds to 16/1 alongside Jeremy Hunt. Sajid Javid is the outsider in the short pack at 25/1.
The candidates are caught on the Brexit tripwire. The EU elections pushed forward the agenda of the Brexit party. The Lib Dems gained support as a plausible "remain" option. The Brexit debate is polarising politics. A recent YouGov poll put the Lib Dems and Brexit party ahead of Labour and the Conservatives. If the Tories were traumatized by UKIP, they will be terrified about the new Farage Brexit Party. Candidates for the Downing Street race flaunt hard line Brexit policies to garner support among the right wing back benches.
The CBI warned again this week of the dangers of a no deal exit. In the mayhem of the hustings, the complaints from business groups will be overshadowed by naked political ambition. It doesn't bode well ...
Don't say we didn't warn you ...
The trade war with China is hotting up. This week the ominous warning "Don't say we didn't warn you" emerged from within the Beijing ranks. The People's Daily, the Communist Party's official mouthpiece, carried a stark warning for the United States.
The People's Daily, which often signals official positions with subtle language, uses the phrase sparingly: It famously appeared before China launched border attacks against India in 1962 and Vietnam in 1979.
Additional tariffs on $60 billion of US imports were implemented this month. China is considering restrictions on the export or rare earth metals. On Friday, China announced it would establish a blacklist of "unreliable" foreign companies and organizations, effectively forcing companies around the world to choose whether they would side with Beijing or Washington.
No sign of a settlement any time soon, The developing tit-for-tat is reinforcing a sense in Washington and
Beijing the world's two largest economies are destined to unwind a system of economic dependency built over the past three decades. The Times they are a changing. The Trump administration appears oblivious to the dangers to the US economy of arbitrary trade actions.
On Friday night, the Trump administration announced, it would strip India of a special status that exempts billions of dollars of its products from American tariffs. The decision is set to raise trade tensions with the world’s second-most populous country. The move was taken as retaliation for what Mr. Trump said was India’s failure to provide “equitable and reasonable access to its markets.”
Earlier on Friday, Trump announced tariffs on Mexico, "On June 5th the US will impose a 5% Tariff on all goods coming into the country from Mexico, until such times as illegal immigrants coming through Mexico STOP. The tariff will gradually increase (to 25%) until the illegal immigration problem is remedied."
"Mexico has taken advantage of the United States". "Mexico makes a fortune from the United States". "Mexico has taken 30% of our Auto Industry". "We have a $100 billion dollar deficit with Mexico". The Trump temper tantrum continued on twitter.
No thought of the New NAFTA deal, or the wishes of business across the US. Trump had taken the unusual step of linking trade tariffs to an immigration policy objective. The US Chamber of Commerce denounced the move with a consideration of legal action. House Democrats began considering legislative remedies aimed at halting the arbitrary powers of the President to implement tariffs. Border state Republicans expressed concerns. The President of Mexico was confused. "Social problems cannot be resolved with tariffs" his claim.
The administration was split on the issue. President Trump's top trade adviser Robert Lightizer had opposed the plan. Jared Kushner had expressed concern ... the chances of implementation look slim ... so what was the real reason for the Trump actions this week ...
"The Peach in impeachment ..."
Bob Mueller made a statement this week, effectively putting the Democrats on notice to begin impeachment proceedings. Nancy Pelosi is facing pressure from the hard line ranks to take action. The Mueller statement had made it clear this week, there was adequate just cause.
"As set forth in the report, after the investigation, if we had confidence that the president did not clearly commit a crime, we would have said so," Mueller told reporters at the Justice Department on Wednesday.
"Justice Department policy prohibits the indictment of a sitting president, charging the president with a crime was therefore not an option we could consider," Mueller said, adding that the Constitution requires a "process other than the criminal justice system" to address wrongdoing by a president. He was talking about impeachment of course.
There appears to be clear evidence of obstruction of justice by the President of the United States. Trump was infuriated. "The Greatest Presidential Harassment in history. After spending $40 million dollars over two dark years, Robert Mueller would have brought charges if he had anything, but there were no charges to bring."
Trump claims Mueller was conflicted and biased against him. "He had wanted to be Director of the FBI," claimed Trump, "I said no." The next day he was appointed special counsel!"
The Mueller Story threatened to grab the headlines over the week-end. The White House has a back stop "Wag the Dog" strategy. Wag the Dog is a black comedy film starring Dustin Hoffman and Robert De Niro. The screenplay concerns a spin doctor and Hollywood producer who fabricate a US war to distract voters from a presidential scandal. It's a great movie and a cute strategy.
The announcement of "immigration tariffs" against Mexico is diversionary strategy, without logic, merit or substance. What is the value of any trade deal or international agreement made with the USA with Trump in the White House? Markets, the much loved barometer of the President, reacted pushing the DOW, NASDAQ and others across the world lower in response.
Trump revealed on Twitter last night, he will be announcing his Second Term Presidential run on the 18th June in Orlando, Florida. Melania and Mike Pence will be there. Mickey and Minnie will not. The venue will be the Amway centre Florida. Disneyland didn't make the cut.
The President's best mate Kim Jong-un has expressed support. Last week the Korean regime called Joe Biden "a fool of low IQ" and mocked Biden for thinking he would be a popular candidate. "This is enough to make a cat laugh" the report said. Trump could only agree and did on Twitter of course.
West Wing WTF ... it's enough to make a cat laugh ... and it is getting worse ...
That's all for this week, have a great weekend. We will be back with more news and updates next week!
The Saturday Economist
John Ashcroft publishes the Saturday Economist. Join the mailing list for FREE weekly updates on the UK and World Economy.
The material is based upon information which we consider to be reliable but we do not represent that it is accurate or complete and it should not be relied upon as such. We accept no liability for errors, or omissions of opinion or fact. In particular, no reliance should be placed on the comments on trends in financial markets. The presentation should not be construed as the giving of investment advice.