On Friday, while exploring the possible significance of a tweet from Dealbreaker favorite (and man who knows that Gary Cohn has itsy bitsy girly hands) Charlie Gasparino, we asked a simple, but important question:
What the fuck happened to Steve Mnuchin?!
It was just a month ago when Steve somehow managed to do what Cohn's "dainty" hands couldn't: lasso the bucking protectionist bronco that is Peter Navarro.
See, Steve and Peter got into a screaming match in Beijing and while that sounds like something Trump would generally be into (remember, he likes to foster a "healthy" dynamic among his top advisors, where "healthy" means turning everyday into Mortal Kombat), it apparently embarrassed the U.S. delegation and ultimately landed Navarro in the timeout corner.
In Peter's absence, Mnuchin managed to strike a deal with China and on Sunday, May 20, he declared the trade war "on hold".
Navarro was furious (and incidentally so was Steve Bannon, although it's not immediately clear why anyone gives a shit what Steve Bannon thinks at this point) and Trump would promptly change his mind. Fast forward to Friday and the administration officially announced that America would be moving ahead with tariffs on $50 billion in Chinese goods. As you're undoubtedly aware, things escalated further this week as Trump took things up a notch even beyond the not-yet-finalized second list (which would target $100 billion in additional Chinese goods), announcing the formulation of what I guess would be a third list aimed at identifying $200 billion of other shit to tax.
That latter escalation proved beyond a shadow of a doubt that Steve Mnuchin was, like Gary Cohn and his dainty hands, vanquished by Navarro who, in a series of truly ridiculous comments representing a victory lap, told CNBC on Tuesday that Trump is a "courageous visionary" for his efforts to confront China on the way to upending global trade and commerce. To those comments we said the following:
This might be a good time to remember that old adage about the enemy of your enemy being your friend.
In other words, it’s time to start rooting for Steve Mnuchin.
Well now we know where Steve has been. Apparently, he's suffering in silence (maybe wiping his tears with dollar bills bearing his signature). Here's Bloomberg, from an article out Wednesday:
Treasury Secretary Steven Mnuchin is signaling his displeasure with President Donald Trump’s trade war with China by saying nothing at all.
Mnuchin decided silence was his best option after losing an internal White House battle last month to protectionists as the president considered the China tariffs, they said.
Silence is Mnuchin’s way of balancing loyalty to the president while preserving his personal credibility with financial markets, without publicizing disagreements among administration officials, the people said. They asked not to be identified describing his thinking.
Now first of all, what "personal credibility with financial markets" are these sources talking about, exactly? I mean, Steve is Steve and that's not nothin', but it ain't exactly somethin' either. We're not talking about Jamie Dimon or Lloyd Blankfein here.
And when it comes to "credibility with financial markets", let's not forget that this is the same Steve Mnuchin who weaponized the stock market in the service of cramming through Trump's deficit-funded tax cuts last year. Specifically, Mnuchin told Politico that if the tax cuts failed, equities would fall and while that was probably a reasonably accurate assessment, it kind of ignores the fact that those same tax cuts are what forced that same Steve Mnuchin to unleash a deluge of Treasury supply in 2018 which has served to further distort the supply/demand picture in the U.S. debt market at a time when the Fed is running down the balance sheet.
In short: if Steve was really concerned about "personal credibility with financial markets", you'd think he wouldn't be doing shit like going on Bloomberg TV and swearing that the juxtaposition between increased supply and the removal of a price insensitive bid (the Fed) doesn't have the potential to cause problems somewhere, even if those problems manifest themselves first and foremost in "shithole" countries (where that means emerging markets in this case).
But beyond that, it's too late for this. You're all-in, Steve. You ignored a letter from your classmates warning you to resign in light of your boss's "support of Nazism and white supremacy." Once you've thusly indicated that you're willing to go down with the ship, you can't just go MIA on something that you ostensibly have some sway over. You might not be able to keep Trump from lecturing reporters on Thomas Jefferson, the "major slave owner", but you could at least not give up on the future of global trade at a time when a guy who no one takes completely seriously has commandeered not only the narrative, but the actual policymaking process.
But don't worry folks, Steve is plotting his comeback. To wit, from the same Bloomberg article mentioned above:
His decision cedes at least temporarily the Treasury secretary’s traditional role as chief economic spokesman for the administration to people more willing to take up the cudgel against China and other U.S. trading partners, such as U.S. Trade Representative Robert Lighthizer and White House trade adviser Peter Navarro. But by avoiding an open break Mnuchin hopes to maintain influence with the president, perhaps yet giving him the opportunity to persuade him to change course, the people said.
I see. So we're supposed to believe that Steve's "strategy" is to play possum and then, when the time is right, mount a coup against the protectionists?
Good luck with that, Steve.
Our best bet now might be to just let Louise Linton poor-shame Navarro on tha' 'Gram. Maybe we can distract Peter with that.
Or Steve could just resort to petty pranks - maybe he can regift that box of horse shit to Navarro.