President Biden has been busy this week.
Flying first to South Korea, and then on to Tokyo for his first trip to Asia as President.
To say that it's been an eventful trip would be an understatement. With worldwide headlines made over Biden's position to vis a vi American Ally Taiwan.
But Taiwan was not supposed to be the focus of the trip. Or the main impetus of this Biden foreign policy junket.
The trip was designed to promote. And I quote the White House: “A Free and Open Indo-Pacific.”
To facilitate trade between the 12 Pacific nations that collectively represent 40% of the world's GDP.
Note the use of the term Indo in reference to this new proposed trade alliance. This indicates I Believe the central position of India in the proposal.
It is clear that India will play a pivotal role, in the new and emerging bipolar global economy.
On the one hand, the traditional western powers are Europe and America.
And on the other hand, Russia and China. Who are, I think successfully, breaking away from the old order.
Establishing their own trade, driven largely by Russian oil and eventually Chinese manufacturing.
Also established their own international financial systems, which directly compete with the west.
And right in the middle of these two competing camps, lies India. Sought after by both sides. Representing a billion people, and by all demographic projections destine to become the most populist nation on earth.
And as you know, Russia and China have been actively wooing India. Trying to encourage them to come over to their side of the new bipolar world.
A move, should it occur would be strategically and economically pivotal.
Russia has made a strong case. Providing India with substantial quantities of oil, all at reasonable prices.
Prime Minister Modi, has played all this very close to the vest. Allowing Russia and China to make their case. All the while waiting for the US to make its case.
And this weekend was our chance. President Biden's opportunity to bring India into the American fold. And strengthen a strategically important relationship.
So, how did the President make his case?
Well, knowing that oil is India's hot button. And also referencing the current bout of American inflation, Biden told the world this weekend that America is “Transitioning” quote/unquote:
“Here's the situation. And when it comes to the gas prices, we're going through an incredible transition that is taking place, God willing, when it's over, we'll be stronger and the world will be stronger and less reliant on fossil fuels when this is over.”
Unquote President Biden.
Hum, “less reliant on fossil fuels...
In the history of American diplomacy, it is hard to remember a larger faux pas by a sitting President.
Prime Minister Modi needs energy. His county is reliant on imported oil and gas.
On the one hand, Russia will supply all its country's needs.
Or, on the other hand, he can “Transition” with the United States to some other, un-stated alternative.
How do you think he will choose?
Franklin Roosevelt gave the nation the “New Deal.” John Kennedy gave us the “New Frontier.” Joe Biden is giving us “The Transition.”
Today's Economic News
How do you see the economy over the next 3 years?
That's the question that businesses have to ask before they purchase their next group of Durable Goods.
Products that are expected to last at least 36 months.
Decreases in Durable Goods orders, like the one Wall Street, anticipates this morning is an indication that business is turning negative on the long-term economic outlook.
The street looks for a very slight decline in Durable Goods this morning.
Then later this afternoon, all eyes will turn to the release of the latest Minutes from that Fed Meeting of 3 weeks ago.
At that meeting, the Fed went all out with a half-point rise in interest rates. Bringing the fed funds rate to 1%.
All in an effort to control inflation. Wall Street expects the Fed to raise rates another half-point, in both June and July.
Today's report should tell us if we're on the right track.
Just reporting has been the number of new mortgage applications for last week.
Following that tremendous drop in New Homes Sales reported yesterday.
New mortgage applications, as expected, are also down this morning. But only by slightly over 1%.
On the earnings calendar today, an entire group of technology companies. We begin with graphics company, Nvidia, then cloud company Snowflake, Splunk, and IT company DXT Technology.
All west coast companies, all reporting after the market closes.