by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] There was a lot of overnight news, but below are the stories we are following today:

Trade war with China?  The U.S. has formally declined China’s bid to be treated as a market economy within the World Trade Organization (WTO).  The move will likely heighten tensions between the two countries.  If China is named a market economy it would limit U.S. ability to impose duties on Chinese exports.  The Trump administration has consistently argued that China engages in unfair competition.  Yesterday, the Department of Commerce opened an investigation into Chinese steel, in which China has been accused of making its steel artificially cheap in order to push down global prices and price out competitors.  Although the U.S. has failed to place any trade restrictions on China, it appears to be signaling that it may do so down the road.  We will continue to monitor this situation.

Response to NK threat: Following North Korea’s recent missile launch, the U.S. has been urging the rest of the world to cut off ties with the rogue nation.  Yesterday, U.S. ambassador to the UN, Nikki Haley, threatened to disrupt Chinese oil shipments to North Korea if China continues to supply North Korea with oil.  It is unclear whether China will comply, but it does signify a dramatic shift in rhetoric.  China has been reluctant to cut off oil supply to North Korea due to the humanitarian crisis it might cause.  In addition, as mentioned in yesterday’s comment, cutting off oil to North Korea may not change the trajectory of its nuclear program.

Debate on tax bill: The tax bill is headed to the Senate floor for debate.  Although there seems to be support for the bill, recent revisions have led to speculation on whether it will pass.  Sen. Bob Corker’s (R-TN) insistence on a trigger component that would raise taxes if revenue requirements are not met has drawn the ire of some of his colleagues.  At this point, some Republicans are skeptical of the bill as there were many concessions made in order to satisfy various factions within the Republican Party.  Most notably, the desired 20% corporate tax rate is rumored to have increased to around 22%.  Assuming the Democrats keep a united front, the tax bill can only afford to lose two votes from Republicans to ensure passage.  The bill is expected to be put to vote by Friday at the latest.

Post-Brexit U.K.: Yesterday, the U.K. and the EU agreed on a Brexit “divorce bill” of about €50 bn, therefore setting up talks for a future trade arrangement with the EU.  In the wake of discussions, we expect the U.K. to begin to showcase itself as a viable place for investment and trade following its departure from the EU.  Yesterday, Mark Carney stated that the U.K. could abandon a rule imposed by the EU that placed a cap on bonuses for financial institutions.  Financial institutions have railed against the measure since its inception.

New Fed governor: Yesterday, President Trump nominated Marvin Goodfriend to the Fed’s Board of Governors; he will fill one of the four vacancies on the Board of Governors.  In the past, Goodfriend has advocated for more transparency and less independence of the Fed, in addition to his belief that Fed policy should be measured against a mathematical rule like the Taylor Rule.  Although Goodfriend has been labeled a hawk, he has warned that the Fed should be prepared to push interest rates back to zero; he has been known to favor negative rates over quantitative easing.  Goodfriend’s nomination will likely be viewed positively by Senate Republicans.

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by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] Although yesterday was a news-heavy day, financial markets are relatively calm following North Korea’s missile launch and an upward revision to GDP.  Below are the stories we are following:

Nuclear North Korea: Yesterday, North Korea had its most successful missile launch and says it is capable of hitting anywhere on the U.S. mainland.  Following the launch, North Korean Leader Kim Jong-un announced that his nuclear program is now complete.  It is unclear how the United States plans to respond to the launch, but officials within the Trump administration have stated that the U.S. will continue its current policy of isolating North Korea and reaffirming its threat of possible military action.  It has been suggested that China could be pressured into cutting off oil supply from North Korea.  Although China’s “technical difficulties” with its oil pipeline in 2003 forced North Korea to the negotiating table then, China’s recent attempt at limiting oil supply to North Korea has failed to yield a similar result.[1]  Nevertheless, while the recent missile launch has increased the likelihood of a potential preemptive strike by the U.S., markets have been relatively mum.  We will continue to monitor the situation.

Possible trade war: It appears the warm relationship that had developed between President Trump and President Xi has finally cooled.  Yesterday, the Trump administration initiated an investigation into imports of aluminum sheets from China, marking the first time since 1985 that the Commerce Department has initiated an investigation without a formal request.  If the Commerce Department determines China has aided in unfair trade practices that have hurt the U.S. steel industry, it will instruct the U.S. Customs and Border Protection to collect duties from U.S. companies that purchase the steel.

Senate tax bill makes it out of committee: Yesterday, the Senate tax bill barely made it out of the committee after the two Republican holdouts were finally cajoled into voting for the bill. Concessions appear to have been made to Sen. Bob Corker (R-TN) to ensure the bill is more revenue-neutral, while Sen. Ron Johnson (R-WI) may have succumbed to pressure.  The bill is expected to come to the Senate floor on Thursday, which would put it on track to meet the president’s Christmas deadline.  That being said, there is still speculation that there is not enough support among Senate Republicans, although there have been rumblings that at least two Senate Democrats, Joe Manchin (D-WV) and Heide Heitkamp (D-ND), may support the bill.  At this time, we believe it is a coin toss as to whether or not the bill is able to make it through the Senate this week.

Government shutdown?  Nancy Pelosi and Chuck Schumer skipped a bipartisan meeting with President Trump to discuss the government budget following comments the president made on Twitter.  President Trump accused the two of being weak on illegal immigration and crime, in addition to wanting to raise taxes.  The spat between the two sides has increased the likelihood of a government shutdown; the government is currently funded through December 8.  Presently, there is not enough support among Republicans to secure funding, therefore the Democrats are using their leverage to gain assurances that the children in the DACA program will remain protected as well as secure financing for the Children’s Health Insurance Program.  It is unclear whether a budget deal is imminent and therefore it is likely that another stopgap spending bill will be passed to keep the government funded past next week.

EU/Brexit bill: It appears the EU and U.K. are close to coming to terms on a Brexit “divorce bill.” It is believed the U.K. will pay a little under €50 bn to settle claims with the EU, whereas the estimated liabilities were €100 bn.  After the agreement is finalized, the two sides will begin discussions on a free trade pact, a “hard” Irish border and the rights of EU citizens in the U.K.

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[1] https://www.economist.com/news/letters/21726670-populism-north-korea-childlessness-renewables-shipping-eurocrats-bullets-iceland-st

by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] Financial markets are relatively quiet this morning.  We are watching the following news events:

Senate tax bill: Today, the Senate’s tax reform bill awaits approval from the Senate Budget Committee.  Although approval from the committee is usually a formality, there is growing speculation that the bill might not achieve the majority votes needed to make it through.  Senators Ron Johnson (R-WI) and Bob Corker (R-TN) have publicly come out against the bill in its current form.  Sen. Johnson would like deeper tax cuts for pass-through businesses, while Sen. Corker would like to place a penalty provision in the bill that would raise taxes if economic growth fails to ensure the bill remains revenue-neutral.  These demands seem steep given the political factions that exist within the Republican Party.  The budget committee is split between 12 Republicans and 11 Democrats, so the bill needs support from both Republican senators as the Democrats have refused to support it.  If this bill fails to make it out of committee, it will further delay tax reform.

Tension before coalition talks: Yesterday, the European Commission voted to renew the license for the controversial weed killer glyphosate.  Germany was not expected to support the renewal so the approval came as a surprise (Germany had abstained from the previous vote when the license was rejected).  Upon approval of the license, France and Italy maintained they would continue to ban the use of glyphosate in their respective countries.  Glyphosate is a substance used in weed killer that became controversial after a WHO report claimed the substance was “probably carcinogenic.”  The vote could complicate talks for a coalition government in Germany between the CDU/CSU and the SPD as the SPD has consistently supported the ban on glyphosate.  Although this issue may have damaged trust between the sides, it appears that talks to form a coalition government will continue.  So far, the euro has remained stable which suggests there is still optimism that a deal will be struck.  We will continue to monitor the situation.

The return of AMLO: In Mexico, Andres Manuel Lopez Obrador (AMLO) is currently leading the polls for the presidential election planned for July 1, 2018.  AMLO, a populist candidate with a loyal following, is expected to finish within the top two contenders for the third consecutive election.  In the previous two elections, AMLO led in the polls early only to lose in the general election.  A win by AMLO would increase the likelihood that Mexico will exit NAFTA as AMLO believes the agreement hurts Mexican farmers.  That being said, it is widely believed the establishment parties, PAN and PRI, will do everything in their power to ensure AMLO does not win the presidency.  These parties have recently seen a dip in support on corruption suspicions.

Jerome Powell: Later today, Fed chair nominee Jerome Powell is expected to meet with the Senate Banking Committee to begin his confirmation hearing.  Prior to the hearing, he sent a statement to the committee in which he expressed broad support for Chair Yellen’s agenda and signaled that he will continue down the path of gradual rate increases and shrinking the Fed balance sheet.  He also mentioned that he would be open to considering “appropriate ways” to ease rules on banks.  After making it through two confirmation hearings without resistance, Powell is expected to be confirmed, replacing Yellen when her term ends in February.

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by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] Financial markets are a bit weaker this morning—equities are signaling a softer open, while Treasuries have slightly rebounded.  This morning we are focused on the following issues.

Grand coalition in Germany? In order to form a government, the CDU has agreed to pursue a grand coalition with the Social Democrats (SDP).  Speculation that Angela Merkel would rather hold new elections than form a minority government is believed to have brought the SDP to the negotiating table.  As mentioned in our prior reports, minority governments are typically ineffective and tend to place a lot of pressure on the head of state, in this case Chancellor Merkel.  As a result, any instability throughout Germany or the Eurozone could lead to a challenge to Merkel’s leadership.  At the moment it is unclear whether a deal is imminent, but the euro has strengthened on the news.

Tax bill: Later this week, the Senate is expected to vote on its version of the tax bill, which is currently undergoing changes to satisfy several hold-outs.  The expected changes to the bill will be aimed at making it more palatable to senators who believe the bill does not lower taxes enough for middle-class households and may add to the deficit.  Last night, the CBO released a report stating that the bill will add up to $1.4 trillion to the deficit over the next decade and will primarily benefit Americans making more than $100,000 a year.[1]  Currently, it appears the Senate does not have enough votes to meet President Trump’s Christmas deadline.  We will continue to monitor the situation.

Catalan elections: Recent polls suggest the separatists will fail to form a majority in Catalonia following forthcoming regional elections on December 21, while constitutionalist parties have grown in popularity.  According to the Spanish publication El Pais, separatists are expected to pick up 67 seats, which is one short of the majority and five fewer than the previous election.  The Citizen’s Party, a constitutionalist party, is expected to see the largest jump in seats with 10.[2]  A separatist majority in the Catalan parliament would be bearish for the euro as it would signal more instability in Spain.

NATO in the Middle East?  Over the weekend, an attack on a mosque in the Sinai region of Egypt left 305 people dead; ISIS has since claimed responsibility.  In response to the attack, Saudi Arabian Crown Prince Mohammad bin Salman has pledged to pursue a military coalition with other Sunni states to counter the ISIS threat in the Middle East.  Many are speculating that Saudi Arabia will use the alliance to further isolate its arch-rival Iran, similar to how the U.S. used NATO to isolate the Soviet Union during the Cold War.  Earlier this year, Saudi Arabia, along with other Sunni states, imposed sanctions on Qatar in order to force it to sever ties with Iran, among other things, although it justified the sanctions by accusing Qatar of sponsoring terrorism.

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[1] https://www.washingtonpost.com/news/wonk/wp/2017/11/26/senate-gop-tax-bill-hurts-the-poor-more-than-originally-thought-cbo-finds/?hpid=hp_hp-top-table-main_cbo-tax-915pm%3Ahomepage%2Fstory&utm_term=.3f5ee0f0a134

[2] https://elpais.com/elpais/2017/11/26/media/1511719941_954557.html

by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] As a reminder, we will not publish the Daily Comment this Friday, November 24.  Although financial markets are quiet, there was a good bit of news.  Here’s what we are watching:

Yield curve flattening: Yesterday, the U.S. yield curve flattened to its lowest point since November 2007; as a result, there have been growing concerns of an impending economic slowdown. The yield curve is one of the most widely used financial indicators in determining the health of the U.S. economy. An upward sloping yield curve signals that the economy is in good shape, whereas a flattening yield curve signals a possible slowdown and a downward sloping yield curve signals a possible recession. Furthermore, a change in the yield curve does not necessarily signal a change in the economy but rather it could reflect current monetary policy. As the Fed raises short-term interest rates, the market adjusts long-term interest rates based on inflation expectations.

That being said, we believe the flattening of the yield curve is the result of a combination of the Fed raising short-term rates and falling inflation expectations. After the election, inflation fears rose, which led to a rise in long-term interest rates. Inflation expectations have fallen as post-election inflation fears proved to be unfounded.

The chart above shows the spread between the two-year and 10-year Treasuries from June 2016 to the present. After Trump won the presidency there was a spike in the spread between the two- and 10-year Treasuries, but it has seen a steady decline since. A flattening yield curve suggests the Fed should be cautious with rate hikes next year as its actions could lead to an inverted yield curve. This sentiment is mirrored by Chicago FRB President Charles Evans, who expressed his hesitancy last month for supporting rate hikes if inflation expectations do not pick up.

Mugabe out: After 37 years of rule in Zimbabwe, Robert Mugabe has formally resigned from office and will be replaced his former Vice President Emmerson Mnangagwa. Mugabe’s peaceful departure is a positive sign for the region as it paves the way for new elections next summer. The change of power was likely supported by China, which has stood by Mugabe since he came to power in 1980. It has been reported that China became increasingly skeptical of Mugabe as he grew more unpopular among members of his own party.

Tensions rising in North Korea: Yesterday, North Korea escalated tensions with South Korea and the U.S. Last week, a North Korean border guard chased and shot a defector in the demilitarized zone that separates the two Koreas; this incident was a violation of the ceasefire agreement between the two countries. In addition, North Korea has denounced the U.S. decision to re-designate the country as a state sponsor of terrorism. The increased provocation is not likely to lead to war anytime soon, but we will continue to monitor the situation.

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by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] Happy Thanksgiving week!  We want to pass along a heads up that the Daily Comment will not be published this Friday, November 24.  Although financial markets are quiet, there was a good bit of news.  Here’s what we are watching:

Merkel leans toward new elections: Yesterday, we laid out the four options for Germany, suggesting that new elections were the least market-friendly because this outcome raises uncertainty.  Increasingly, it looks like Merkel is leaning toward new elections, unwilling to ask the SDP to join a grand coalition or form a minority government.  Senior leaders within the CDU/CSU are giving the parties three weeks to form a government but are putting increasing pressure on the SDP to change its position.  There are two reasons the SDP is reluctant to join Merkel to form a government.  First, voters across Europe are shunning center-left parties for ignoring the needs of lower income citizens and opting for more market-friendly policies.  The SDP took a drubbing in the polls and fears that joining Merkel again could lead to the end of the SDP as a functioning political party.  Second, joining Merkel would raise the status of the AfD by making it the official opposition.  There are hints that the SDP will join the CDU/CSU on one condition—Merkel steps down from the chancellor position.  This is why Merkel is instead willing to take a shot at another round of elections.  One important issue to remember is that Merkel has had a tendency to destroy junior partners in coalitions.  The Free Democrats slipped badly after joining Merkel from 2009 to 2013.  As noted above, the SDP has had a similar experience.  If talks finally fail, the German president will hold votes in the Bundestag for chancellor; the first two rounds of votes require a majority in order to become chancellor.  A third vote is held if a majority isn’t reached, giving the chancellor post to the highest vote winner, which will almost certainly be Merkel.  At this point, either Merkel can operate a minority government, piecing together votes to pass various measures, or the president can declare the government too unstable and call for new elections.  We may be seeing the end of Merkel’s political career.  Political tumult in Europe’s largest economy will tend to weigh on EUR sentiment.  It may help PM May get a better deal on Brexit and will open up the chance for Macron to boost France’s status within the EU and the Eurozone.

North Korea a state sponsor of terrorism: President Trump officially labeled North Korea as a state sponsor of terrorism yesterday, joining Iran, Syria and Sudan with this designation.  The DPRK was initially put on the list in 1988 after its agents detonated a bomb on Korean Air Flight 858 in 1987.  President George W. Bush removed North Korea from the list in 2008 in an attempt to improve relations during nuclear negotiations.  For the most part, this won’t make a huge difference; North Korea is already heavily sanctioned and anything that comes from this change won’t be material.  It is a global shaming for the DPRK and may increase Chinese pressure on Pyongyang.  After all, a rising global power doesn’t want to be seen supporting a designated terrorist state.  The move was also welcomed in South Korea and Japan, which live in fear of North Korean terrorist behavior.  On a related note, Kim Jong-un is disciplining the leadership of the nation’s most powerful military organization.  Although there is no information suggesting a purge of the military’s leadership, they are being “punished.”  We suspect two issues here.  First, Kim wants to put his own people in place and has been steadily removing his father’s cronies; this action may be part of that.  Second, Kim’s father had increased the power of the military over the civilian structures of the government, including the party.  Kim may be deciding that he wants to reverse that program.  We watch this because unexpected outcomes are possible any time important parts of the North Korean government come under pressure.

Yellen out: Although it isn’t a huge surprise, Chair Yellen made it official, saying she would not serve out her term as Fed governor when she steps down as chair in February.  Her governor term lasts until 2024.  This move is precedent at the Fed; when chair and vice chair terms expire in this particular office, they retire.  This is done to allow the replacements to more easily conduct their policy.  Imagine if Greenspan had stayed around as a governor after Bernanke became chair.  Divisions and second-guessing, especially during the Great Financial Crisis, would have been a real problem.  Thus, the president will have three governors in place after February—Brainard, Powell and Quarles.  He can appoint four more governors and really put his stamp on the FOMC.

No to a major merger[1]: We rarely discuss company-specific issues.  This is a macro publication and thus we don’t comment on individual company issues unless they have a macro impact.  The DOJ’s decision to reject the AT&T (T, 34.64) and Time-Warner (TWX, 87.71) merger is one of those events.  Since Reagan, the DOJ has generally been merger-supportive.  Anti-trust legislation from the Progressive era of President Theodore Roosevelt to Reagan generally prohibited large combinations.  Size was a key determining factor.  The legal arguments tended to center on whether the combined firm dominated an industry.  During the Reagan administration, anti-trust regulation shifted its focus to outcomes.  If a monopolist did not abuse its pricing power, mergers were generally approved.  A theory called “contestable markets” emerged, which suggested that mergers were usually approved even if an industry was concentrated so long as there was ease of entry so the oligopolist firms could not act with pricing power.  The key determinant seemed to be how the firms in an industry treated consumers.  If consumers didn’t face higher prices after the union, the DOJ generally didn’t object.  Thus, “vertical” mergers, combining industries together, were usually approved whereas “horizontal” mergers, firms in the same industry, faced greater scrutiny.  The aforementioned merger is considered vertical because one firm is in the distribution business while the other is in content.

What we may be seeing here is a change in precedent away from the Reagan model to the pre-Reagan model.  In practice, firms have discovered that they can reach mammoth size if they don’t adversely affect customers.  Thus, labor tends to get hammered by companies.  The whole move to the “gig” economy appears to simply be a way to push down labor costs.  Mergers seem to do the same thing.  The bigger firms become in an industry, the more they become monopsonists in the labor market for that industry.  In other words, if there were only one tech firm, it could keep programmer wages low because there wouldn’t be competition from other firms bidding up wages.  If the Trump DOJ stands its ground on this merger, it could have a chilling effect on the mega-tech industry.[2]

DACA: Don’t sleep on a December 8^th shutdown.  Democrat Party leaders are making DACA a key element in approving a continuing resolution to fund the government and perhaps raise the debt ceiling.  With the GOP tied up with tax issues and the president generally open to the “dreamers,” we expect Chuck and Nancy to use their leverage to try to get a win even if it leads to a government shutdown. 

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[1] A potential tongue twister…similar to https://www.youtube.com/watch?v=2OBZf0QdKdE

[2] See https://www.axios.com/the-ripple-effect-of-the-att-merger-lawsuit-2511164001.html and https://www.axios.com/the-facebook-whistleblower-wave-2511168571.html?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosam&stream=top-stories

by Bill O’Grady and Thomas Wash

[Posted: 9:30 AM EST] Happy Monday and Happy Thanksgiving week!  We want to pass along a heads up that the Daily Comment will not be published this Friday, November 24.  Here’s what’s going on this morning:

Coalition talks collapse: Chancellor Merkel has been unable to pull together a coalition consisting of her CDU/CSU party, the Free Democrats (FDP) and the Greens, announcing this morning that talks have broken down after the FDP walked out of negotiations.  Apparently, the three sides (and, perhaps, four because the CDU and CSU have differences as well) could not agree on a number of issues, the primary one being immigration.  There are four possible outcomes: (1) Merkel can’t form a government and new elections are called.  This action would be unprecedented in German postwar history and the process is remarkably clumsy.  The Bundestag would need to elect a new Chancellor (most likely Merkel), who would then need to lose a no-confidence measure, leading President Steinmeier to call a new election.  Losing the no-confidence vote would further weaken Merkel and new elections would raise the chances that the populist AfD would get even more support.  Thus, we expect the German political establishment to work furiously to avoid this outcome.  (2) The Social Democrats (SDP) join Merkel in another “grand coalition.”  The SDP remains adamant against this outcome as its coalition with the CDU/CSU in the last government undermined the party.  And, if the SDP joined the government, the AfD would become the official opposition, furthering its political fortunes.  (3) Merkel goes with a minority government with either the Greens or FDP, also unprecedented and likely unstable.  (4) The FDP walkout was a bargain ploy and they return at the 11^th hour to form a government and get more power.  In rank order of most market-friendly to least, we would say #2, #4, #3, #1.  At this point, we think #4 is the most likely, although the FDP must move quickly if this is going to occur.

The EUR fell sharply on news of the failure of the talks but has recovered on hopes that the FDP is bluffing.  The chart below shows the overnight trade of the Eurozone currency.  Initially, the EUR fell sharply, then recovered and has since given up some of its gains.

Geopolitical updates: We begin a three-part WGR series on the recent purge/missile attack/ouster of Lebanon’s PM involving Saudi Arabia this week.  We note this morning that Reuters is reporting there have been backchannel discussions between Israel and the Kingdom of Saudi Arabia.  Although we have suspected as much for some time, the fact that it is being reported suggests both nations are sending signals to Iran that it faces a potentially broader front opposing the Mullah’s actions to control the region.[1]

The Straits Times is reporting that authorities in Malaysia revealed they discovered a makeshift laboratory where it is believed North Korean operatives made the VX that assassinated Kim Jong-un’s oldest brother, Kim Jong-nam.  It is widely believed that North Korea was behind the assassination, despite its denial, and this evidence bolsters that argument.[2]

Spain’s attorney general, José Manuel Maza, died suddenly on Saturday while attending a conference.[3]  He was the lead prosecutor on the case against Catalan separatist leaders.  It remains to be seen how his death will affect the prosecution.

Trade issues: Jonathan Swan of Axios[4] published what could be a blockbuster analysis of the Trump administration’s trade policy by detailing the influence of U.S. Trade Representative Robert Lighthizer.  Lighthizer has a long history in government, working as Chief of Staff for Sen. Robert Dole (R-KS) and as Deputy Trade Representative during the Reagan administration.  He has also practiced as a private attorney specializing in international trade law.  Swan reports that Lighthizer’s mercantilist positions are gaining currency within the administration.  He is recommending very aggressive trade positions against China and has been spearheading the NAFTA negotiations, which appear headed for a rupture.  According to Swan, his presentations on trade have been accepted by the free trade establishment figures in the White House (Mnuchin, Cohn), suggesting that trade conflicts may increase once the tax issue is put to rest.  This is an issue we watch very carefully because it affects markets on various fronts.  First, trade impediments that lead to a narrower trade deficit will have the same effect as a global contraction of the money supply given the dollar’s reserve currency role.  Although our position on the dollar is bearish due to valuation levels, widespread trade restrictions would lead us to reconsider that position.  Dollar scarcity would be bullish for the greenback.  Second, trade impediments, all else held equal, will reduce supply to the American economy and lead to higher inflation.  If it affects inflation expectations, it would be quite bearish for long-duration assets.  Third, higher inflation would lead to faster policy tightening, increasing the odds of a recession.  And fourth, if tax cuts are implemented along with trade restrictions, it would force up private saving and likely slow economic growth.  So far, trade actions have been more bark than bite but that may change next year if Swan’s assessment is correct.

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[1]https://af.reuters.com/article/worldNews/idAFKBN1DJ0R3?utm_source=Sailthru&utm_medium=email&utm_campaign=New%20Campaign&utm_term=%2ASituation%20Report

[2] https://www.nst.com.my/news/crime-courts/2017/11/301375/condo-unit-used-process-vx-nerve-agent-which-killed-north-korean?utm_source=Sailthru&utm_medium=email&utm_campaign=New%20Campaign&utm_term=%2ASituation%20Report

[3] https://www.nytimes.com/2017/11/19/world/europe/spain-attorney-general.html?emc=edit_mbe_20171120&nl=morning-briefing-europe&nlid=5677267&te=1

[4] https://www.axios.com/lighthizer-increasingly-influential-in-white-house-2510871315.html