In This Article:
China Tariffs Up to 100%? Pillsbury Says Maybe Yes
Is President Donald Trump just playing bad cop, or is he really going to raise tariffs again on China? Nobody knows, probably not even Trump himself. However, according to a report from some guy named Michael Pillsbury, not to be confused with the glutinous consumer-oriented baking supplies company owned by General Mills (NYSE:GIS), Trump has so far gone easy on China. It isn’t clear if Trump sent him out as a trial balloon, but Pillsbury went on to make the ominous claim that Trump was considering raising tariffs as high as 100%. “Does the president have options to escalate the trade war? Yes, the tariffs can be raised higher. These are low-level tariffs that could go to 50 percent or 100 percent,” he said, as reported by the South China Morning Post, in an article written by a non-Chinese person named Birmingham. Negotiations resume today.
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Despite the tough talk, it is probably unlikely that Trump would raise tariffs significantly any further, given that he is down in the polls already and his base is starting to complain about hardships from the trade war. Unless Trump wants to go out with a bang and really bring down the Chinese stock market (NYSEARCA:FXI) before he is voted out.
Oracle Founder Says Uber, WeWork, Worthless
Oracle founder Larry Ellison doesn’t have a very good opinion of Uber Technologies (NYSE:UBER), Lyft (NASDAQ:LYFT), or WeWork. The basic problem is that these companies are operating at major losses trying to capture market share while bleeding capital. Even if one of them achieves 100% market share, it will still operate at a loss so it doesn’t really make a difference. The only reason these companies can absorb such consistent losses is that interest rates are so low, and even negative in some cases, that it is very easy to raise more capital to bleed it into nothing. None of this would be possible if interest rates were in any way close to normal. Conclusion being, when interest rates are normalized, these companies will most likely disappear, or at least shrink dramatically and offer services at much higher prices in niche markets, if that much.
Panetta Warns of War Over Saudi Oil Bombing
It’s been a week since Saudi Arabia’s Abqaiq oil processing facility was bombed by somebody or something. The Saudis are pointing their finger at Iran, asking America to pretty much intervene and attack, which would definitely serve the purpose of pushing up oil prices significantly, which is exactly what the Saudis want in advance of the Aramco IPO. It is unclear if Trump cares about doing the Saudis’ bidding for the purpose of pushing up the valuation of their state-owned firm that is already the world’s most profitable by far. Iran denies involvement, but since the country is very bitter, understandably, about US sanctions against their oil exports, it would make sense if Iran were responsible for this. Tehran’s Foreign Minister Mohammad Javad Zarif said any attack targeting Iran would be considered an “all-out war.”