What is the Mar-a-Lago Accord?
The US gives the rest of the world:
1. Security
2. Access to US markets/US consumers
The US gets from the rest of the world:
1. A weaker dollar
2. A bigger manufacturing sector
3. Existing US Treasury debt swapped to new Treasury century bonds
Two tools to achieve such an outcome:
1. Tariffs to grow the US manufacturing sector and to exert pressure on countries to sign the Mar-a-Lago Accord
2. A US sovereign wealth fund that can be used to buy foreign currencies to depreciate the dollar
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As we speak, nations are re-thinking their trust in the US as the global policeman. When the US talks about taking over Canada, Greenland, the Panama Canal, and as it pulls back from Ukraine, leaving Europeans to try to fill in the gap, it makes trust in the US as guarantor of world security totally unfeasible.
US fiscal governance is so chaotic, that who in their right mind would swap a short-duration T-Bill or T-Note for a "Century Bond"?
The actions of DOGE, the cutting off of payments linked to legally awarded government contracts is a form of default. Sure the payees are internal to the USA, and it's not coupon interest... but we're not so naive to think that everyone else who is owed money by the USA isn't watching this show too, are we? Indeed... this very behavior is cited by credit agencies as reasons why the US debt would be downgraded.
Default by fiat.
The Mar-A-Lago Accord is dead before it was ever born
Re: The Mar-A-Lago Accord is dead before it was ever born
Guys look at the chart for Lockheed Martin, ticker symbol LMT. It's down 25% from the 52-week high.
People are really pissed off. I've been reading that Germany and Belgium are thinking about cancelling F-35 orders.
Defense One: Trump’s anti-NATO turn could sink F-35 sales
People are really pissed off. I've been reading that Germany and Belgium are thinking about cancelling F-35 orders.
Defense One: Trump’s anti-NATO turn could sink F-35 sales