Monday Morning Musings: Are Chinese Tariffs A Bad Idea?

The market was lower in pre-market trading after the U.S. announced it would impose tariffs on Chinese tire imports. In response, the Chinese threatened to restrict chicken and auto imports from the U.S.

A trade war with China is a terrible idea, especially since the U.S. currently relies on the kindness of strangers (namely China) to finance its trade deficit and actively buy our Treasury bonds. It will be interesting to see how this unfolds, and how the President reacts to China.

The market had been lower in early trading, but has since again climbed back into positive territory. Materials and industrials are strong, while financials and staples are lagging.

Other than that, there is not much in the way of market moving news. The dollar is roughly flat, after a bounce in early trading. Commodities are a bit lower, with crude oil down near $69, and gold slightly lower as well.

Asian markets closed lower across the board overnight; the 10-year yield is a bit higher to 3.38%; and the VIX is +2% higher to 24.68.

Trading comment: I am taking further profits in WYNN on this morning's spike higher. The stock looks a bit extended, and could pull back. My other positions are doing fine, especially tech which has held up great. GOOG is slowly making new highs for the year, and hopefully RIMM can continue to play catch-up to AAPL.

On a personal note, I am not one to drop names, but over the weekend I had the pleasure of attending one of the most beautiful weddings I have ever been to at the Pelican Hill resort in Newport Beach. My friend married the daughter of the CEO of one of the major homebuilders in the country (and all of his competitors were invited also, funny), and as you can imagine, every aspect of the weekend was first class. I brought my whole family down, and we truly had a great weekend. Congratulations to the new Mr. & Mrs. Ozar--

long AAPL, GOOG, RIMM, WYNN