🚀 Trump's Economic Revolution: Trumponomics 2.0

Good Morning!

Tech stocks led a market downturn today, with European and US futures sliding. ASML's 8% tumble, despite strong Q2 orders, highlights fears over potential US restrictions on China exports. The pound climbed as UK inflation data dampened August rate cut hopes. Meanwhile, the Biden administration's chip crackdown on China continues to rattle global markets, particularly affecting semiconductor stocks.

In today’s email:

• Trumponomics 2.0: Trump unveils his plan

• Bitcoin: Bitcoin back up to $65k handle!

• Satoshi: Craig Wright admits he’s not Satoshi Nakamoto 😒

• Gold: Set to hit new highs in 2024

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THE BIG IDEA

Trump unveils his "Trumponomics 2.0" plan, featuring low taxes, high tariffs, and surprising stance shifts on key economic issues

In a revealing interview, Trump laid out his vision for a potential second term, showcasing a mix of familiar policies and unexpected turns. The cornerstone of Trumponomics 2.0? Sky-high tariffs and rock-bottom taxes. It's like he's channeling William McKinley, the "Tariff King" of the early 20th century.

On the Fed front, Trump's doing a 180. Remember when he and Jerome Powell were at each other's throats? Well, now he's willing to let Powell finish his term through 2026. Talk about a plot twist! But don't think he's gone soft - Trump's warning the Fed not to cut rates before the election, lest it give Biden an economic boost.

Inflation's still a hot topic, and Trump's solution? Drill, baby, drill! He's betting on increased oil and gas production to bring down prices. But economists are raising eyebrows, warning that his tariffs could actually drive up costs for the average family. It's like trying to put out a fire with gasoline and water simultaneously.

Immigration is another key pillar, with Trump doubling down on restrictions. He's framing it as a way to boost domestic wages and employment, particularly for minority groups. It's a controversial stance, to say the least.

In the world of crypto, Trump's done a complete 180

Once a skeptic who called Bitcoin a "scam," he's now championing cryptocurrencies as a necessary American innovation. It's like he's suddenly discovered digital gold and doesn't want China to beat us to the punch.

On the personnel front, Trump's eyeing some surprising picks. Jamie Dimon for Treasury Secretary? It's on the table.

Foreign policy isn't left out of Trumponomics 2.0. He's lukewarm on defending Taiwan and skeptical about supporting Ukraine. But Saudi Arabia? They're still in Trump's good graces.

As for TikTok, Trump's done another flip-flop. Now he's all for it, seeing it as necessary competition to Facebook. It's like he's playing 4D chess with the tech giants.

While Trump claims he's now a seasoned player who understands the levers of power, critics worry about the potential instability his policies might bring. Business leaders crave certainty, something in short supply during Trump's first term.

As we barrel towards the election, one thing's clear: Trumponomics 2.0 is set to shake up the global economy. Whether it'll be a much-needed jolt or a seismic shock remains to be seen. Buckle up, folks - it's going to be a wild ride!

MARKETS AT A GLANCE

TOP NEWS

China's hedge fund long-short strategy outperforms global peers despite market struggles

Despite China's overall market underperformance, the long-short hedge fund strategy has yielded over 10% returns this year, outpacing US and European markets. This success is attributed to China's unique market structure, high retail participation, and policy-driven sector divergences. However, recent short-selling restrictions and dwindling foreign interest pose challenges for fund growth. Experts remain optimistic about the strategy's potential in China's low-correlation, high-dispersion market.

Hedge funds set record bearish bets on corn futures amid supply glut

Hedge funds have increased short positions on US corn to historic levels, driven by high supplies and favorable crop ratings. Corn prices have fallen below $4/bushel, pressuring farmers holding large stockpiles. While the USDA's recent report temporarily halted the bearish trend, analysts note broader deflationary implications for commodities. This price drop benefits consumers but threatens farmers' incomes.

US considers tougher chip export controls on China, pressuring allies

The Biden administration is mulling stricter trade restrictions, including the foreign direct product rule, to limit China's access to advanced semiconductor technology. This move aims to pressure allies like Japan and the Netherlands to tighten their own export controls. US chip companies are pushing back, arguing current policies unfairly burden them while failing to halt Chinese progress. The situation highlights tensions between national security concerns and industry interests.

CRYPTO

Bitcoin rallies to $65K as sellers exhaust supply

Bitcoin's price surged 20% to $65,210, rebounding from a recent low of $56,616. Glassnode attributes this to "exhaustion of German government sell-side pressure" after they sold 48,800 BTC. Strong ETF inflows and declining exchange flows indicate easing sell pressure. The market absorbed the German government's sales and Mt. Gox repayments, suggesting resilient demand from institutional investors.

Craig Wright admits he's not Bitcoin creator Satoshi Nakamoto

Craig Wright, who long claimed to be Bitcoin's creator, has issued a legal disclaimer on his website stating he is not Satoshi Nakamoto. This follows a UK court ruling against Wright in a case brought by the Crypto Open Patent Alliance. The court found Wright's evidence to be forged, leading to potential perjury charges. Wright now concedes he didn't author the Bitcoin whitepaper or hold copyright to the technology.

Trump considers fourth NFT collection, emphasizes US crypto leadership

Former President Trump hinted at launching a fourth NFT collection, citing high demand. He emphasized the importance of U.S. leadership in cryptocurrency to prevent Chinese dominance. Trump noted the success of his previous NFT sales and the shift in traditional banking attitudes towards crypto. This comes amid recent political events, including an assassination attempt that sparked a spike in MAGA memecoin prices.

FTX and CFTC reach $12.7B settlement, awaiting court approval

Bankrupt crypto exchange FTX has agreed to a $12.7 billion settlement with the U.S. Commodity Futures Trading Commission, resolving a 19-month lawsuit. The settlement includes $8.7 billion in restitution and $4 billion in disgorgement, with no additional civil penalty. This agreement is a key component of FTX's reorganization plan, which could see 98% of creditors receive a 118% return. The settlement hearing is set for August 6, with creditors voting on payout preferences until August 16.

GOLD

Gold prices are set to hit new highs in 2024, driven by geopolitical tensions, potential rate cuts, and central bank buying

Gold's on a tear, folks! We're talking all-time highs, and the party's just getting started. Despite the Fed playing hard to get with rate cuts, gold's showing it doesn't need a dance partner to shine. Geopolitical jitters, inflation hedging, and central banks going on a gold shopping spree are fueling this precious metal's ascent.

J.P. Morgan's crystal ball shows gold hitting a dazzling $2,500/oz by year-end. That's not just a lucky guess – it's based on the Fed finally cutting rates in November. But here's the kicker: even if the Fed doesn't play ball, gold's structural bull case is as solid as, well, gold.

China's been leading the charge in central bank gold hoarding, but they've hit the pause button. No worries though – other banks and investors are ready to pick up the slack. And if those ETF holdings start climbing again? We might need sunglasses for all that golden glare.

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