China is Now Officially at War With the US and Japan

It is not a war of guns and soldiers, but a war of finance.

The Trump White House is aggressively going after China on trade. Every other month we are seeing a new round of tariffs announced on hundreds of billions of dollars' worth of Chinese exports.

China is retaliating by devaluing the Yuan against the US Dollar at a pace not seen since early 2016. In real terms, the 10% in tariffs the Trump administration will implement on Chinese goods has ALREADY been negated by China's 14% Yuan devaluation.

A 10% tariff won't add up to much when China's currency is nearly 15% cheap relative to the US Dollar.

There is a second component here… China is well aware that President Trump takes GREAT pride in the fact US stocks have rallied since his election in 2016. With that in mind the Yuan devaluation can be seen as a direct attack on US stocks: the last two times the Yuan was devalued at this pace, the S&P 500 dropped 11% and 12% respectively.

So who does President Trump call to defend the S&P 500?