Chief economist update: Bah humbug

"Have yourself a merry little Christmas,
Let your heart be light
From now on,
Our troubles will be out of sight..."

- Judy Garland

Yes, Virginia, it looked like that over the past few weeks and into the first days of the Christmas month.

The rally in equity markets made it appear that Santa Claus has already come to town - aided by underlying optimism over a US-China "phase one" deal (despite some stumbling blocks) and accompanied by the recent improvement in world manufacturing activity.

The JP Morgan global manufacturing PMI rebounded into expansion territory to a seven month high reading of 50.3 in November after five months of contraction.

...and then came Trump's tweet:

"Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries. The Federal....

.....Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies. This makes it very hard for our manufactures & farmers to fairly export their goods. Lower Rates & Loosen - Fed!"

His follow-up tweet further clarified what irked @realDonaldTrump:

"Manufacturers are being held back by the strong Dollar, which is being propped up by the ridiculous policies of the Federal Reserve - Which has called interest rates and quantitative tightening wrong from the first days of Jay Powell!"

It's the latest update from the Institute of Supply Management (ISM) which shows the manufacturing PMI fell to a reading of 48.1 in November - the fourth straight month indicating contraction in factory activity - versus 48.3 in the previous month and expectations for an increase to 49.2.

The details of the report show that "All but one (Supplier Deliveries) of the PMI subindexes registered at levels associated with contraction" and that ""Global trade remains the most significant cross-industry issue".

What's this? Trump isn't "winning" as he claims?

Link to something T2m4NQLM