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An Apple a day keeps US employment OK?

| Posted by: Paul Donovan | Tags: Paul Donovan

  • Sweden's general election produced the expected inconclusive result. The two main party groups have roughly equal seats in the parliament. The anti-party Swedish Democrats did not perform as well as had been expected. Outside of Sweden that is likely to be the focus, as investors worry about the economic damage anti-parties might do to the global economy.
  • US President Trump has continued to sound quite anti-China over the weekend, after threatening to tax any US consumer who dares to buy anything partially made in China. Apple was criticized by name. Most of the price paid for an Apple product is paid for US input. The final stage of production is often China. Tariffs would apply to the majority US input.
  • The flurry of Twitter activity does suggest that consumer trade taxes will dominate investor concerns this week. Taxing trade tends to hit lower income US consumers more than higher income US consumers, offsetting any wage gains. Lower income groups have not been fairing so well on wage gains either.
  • Japanese second quarter GDP growth data was revised a little higher than had been expected, on better business spending. UK trade and production data is due, and the US Fed's Bostic is scheduled to speak.