Goldman Trading Desk ‘9.5 Out of 10' on Activity Level Amid Rout
Goldman Sachs Group Inc.'s trading desk has seen a level of activity on Thursday that's practically 'unheard of' apart from stock-market rebalancing days as clients dumped equities after President Donald Trump's tariff announcement.
It's the busiest day for the desk since the emergence of Chinese AI startup DeepSeek rattled global markets in late January, John Flood, a Goldman partner and trading specialist, wrote in a note to clients.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Axios
24 minutes ago
- Axios
The U.S.-China leverage game
Negotiations usually boil down to leverage — specifically, who has more of it. In the U.S.- China talks underway Monday in London, the question of who has the upper hand boils down to macro- versus micro-economics. The big picture: A slew of data out of China shows the massive cost that U.S. tariffs impose on the Chinese economy, reflecting both underlying economic weakness and what the nation stands to lose if no trade peace is reached. The U.S., meanwhile, has had a run of perfectly solid macroeconomic data, but has much to lose if China continues throttling supplies of rare earth minerals and other specific goods that U.S. industries desperately need. State of play: All is not well for the fundamentals of China's economy, and plunging trade with the U.S. exacerbated those problems. Chinese exports to the U.S. fell 34.5% in May from a year ago, according to Chinese National Bureau of Statistics data out Monday. Its imports from the U.S. also fell, by 18%. Consumer prices fell for the fourth consecutive month, the bureau said, while producer prices fell the most in nearly two years. The mix of moribund export activity and falling prices compounds the nation's challenges grappling with a property bust and debt overhang. Yes, but: That might make Chinese negotiators eager to make a deal. After all, the nation's leadership views maintaining stable economic conditions and good living standards as crucial for their own hold on power, and collapsing exports to the U.S. undermine that goal. But they have plenty of leverage of their own, tied to U.S. reliance on very specific Chinese exports. Reality check: China's power in this standoff is tied to its ability to restrict exports of rare earth minerals, certain electronics, and pharmaceuticals. By throttling a handful of export categories, China can potentially exact damage on the U.S. economy that's far larger than the dollar value of the lost trade flows. Adam Posen, president of the Peterson Institute for International Economics, argued in an influential essay this spring that this means China has "escalation dominance," the power to escalate or de-escalate according to its goals. What they're saying: "The United States gets vital goods from China that cannot be replaced any time soon or made at home at anything less than prohibitive cost," Posen wrote in Foreign Affairs. In the event of aggressive escalation, he wrote, the U.S. "will face shortages of critical inputs ranging from basic ingredients of most pharmaceuticals to inexpensive semiconductors used in cars and home appliances to critical minerals for industrial processes including weapons production." The intrigue: The Wall Street Journal reported Monday morning that President Trump has authorized his negotiating team to loosen export restrictions on jet engines and other products as part of the talks, citing people familiar.
Yahoo
27 minutes ago
- Yahoo
After vowing ‘90 deals in 90 days,' the White House's rhetoric runs into reality
Donald Trump clearly wants the public to believe he recently struck a trade deal with China. The president did not actually reach such an agreement, but he's leaned into his fictional narrative with great enthusiasm lately. Last Thursday, for example, the Republican published an item to his social media platform, noting that he'd spoken to Chinese President Xi Jinping about 'the intricacies of our recently made, and agreed to, Trade Deal.' Soon after, during an Oval Office event, he again touted the same 'trade deal.' A day later, Trump posted a follow-up item, announcing the members of a delegation who would travel to London to meet with Chinese officials about 'the Trade Deal.' The bad news is that the 'trade deal' in question does not exist, no matter how many times the American president pretends otherwise. The good news is that administration officials will actually have some discussions with their Chinese counterparts. NBC News reported: Senior U.S. and Chinese officials will meet in London on Monday in an effort to de-escalate the bitter trade dispute between the world's two biggest economies that has roiled the global economy, with China's restrictions on critical minerals high on the agenda. About a month ago, Trump announced what he characterized as a 'deal' with China, but the closer one looked at the details, the more the truth came into focus. Georgetown University professor Abraham Newman wrote a great piece for MSNBC that explained, "While the U.S. did avoid a major economic calamity, this is not a deal. The U.S. blinked. ... Far from some diplomatic coup, the U.S. climb down reflects the economic risks of maintaining such high tariffs.' The editorial board of The Wall Street Journal came to the same conclusion, noting, '[T]he China deal is more surrender than Trump victory.' Complicating matters, while the White House and Beijing reached a tentative agreement that paused the two countries' tit-for-tat tariffs, both countries have since accused each other of violating the agreement. All of which brings to mind Peter Navarro, the White House's top trade adviser, who boasted in April, 'We're going to run 90 deals in 90 days.' Navarro added that such a plan 'is possible' in part because 'the boss is going to be the chief negotiator.' Roughly two months later, the grand total currently stands at zero. Generous observers might be inclined to give Trump credit for striking a deal with the U.K., but as The Washington Post's Dana Milbank summarized in his latest column, that deal is really more of a 'vaguely phrased framework with Britain that still hasn't been made public.' What's more, a new Politico report added that a month after the agreement was announced, the U.S.-U.K. duties 'remain in place' and 'there is still no clear timeline for when they'll lift.' Or to put it another way, two-thirds of the way into the '90 deals in 90 days' vow, the White House appears to be 90 deals short. Undeterred, Navarro returned to Fox Business late last week, where he was asked when the public should expect to see some breakthroughs. 'We will have deals,' Navarro said. 'It takes time. Usually, it takes months and years. In this administration, it's gonna take more like days.' On average, the typical timeframe for a U.S. trade deal is roughly 30 months. That didn't deter Navarro from pushing the '90 deals in 90 days' talking point in April, and it apparently didn't stop him from claiming again last week that Team Trump will produce amazing results in a matter of days. The White House's top trade adviser should be going out of his way right now to lower expectations after already having set an impossibly high bar. For reasons unknown, Navarro is doing the opposite, setting up the Trump administration for additional failure. This article was originally published on
Yahoo
27 minutes ago
- Yahoo
Democrats have a dirty secret - they actually like some of the tax cuts in Trump's ‘big beautiful bill'
Some of the sweeping tax cuts proposed in President Donald Trump's massive spending package have found support among Democrats — even as they are expected to oppose the legislation over proposed cuts to Medicaid and other government services when it comes up for debate in the Senate later this month, according to a new report. The gargantuan budget package, which House Republicans and the White House have dubbed the One Big Beautiful Bill Act, passed the House by a single vote last month and is now drawing heat from fiscal hawks in both chambers as well as Tesla CEO Elon Musk, who was fresh off his months-long stint as a special government employee when he began threatening to back challengers to any legislator who votes for the bill. Still, there are facets of the proposal that have appeal for some Democrats, the New York Times reports. Virginia Rep. Don Beyer, a Democrat who is also a wealthy car dealership owner, told the Times his party is 'in general very much in favor of reducing taxes on working people and the working poor' when asked about Trump's plan to end taxes on service workers' tips. 'Those people are living on tips,' he added. Trump's tip tax cut plan has also attracted attention from Sen. Jacky Rosen of Nevada, a state where service workers make up a large and powerful voting bloc that has traditionally supported Democrats but shifted to Trump in large numbers during the 2024 presidential election, handing him the Silver State's electoral votes. Rosen, a Democrat, took to the Senate floor last month to advance a bill approving Trump's 'no tax on tips' plan. It passed unanimously even though the measure was largely symbolic because the U.S. constitution requires tax laws to originate in the House 'I am not afraid to embrace a good idea, wherever it comes from,'. she said at the time in remarks on the Senate floor. Yet despite the support for some of the individual tax provisions in the plan, it's highly unlikely that it will be able to muster enough if any Democrats to ease the way to Trump's desk, even under a Senate procedure known as budget reconciliation, which fast-tracks some types of spending legislation without subjecting it to the upper chamber's de facto 60-vote threshold for passage. Democrats are expected to unanimously vote against the legislation in the upper chamber, where it has also attracted opposition from some Republicans who've complained that the cuts to spending in the package don't go far enough to offset the reduced revenue caused by provisions meant to enact Trump campaign promises to end taxes on tips for service workers, as well as taxes on overtime pay for hourly workers and on social security benefits for seniors. Nonpartisan experts such as those at the Congressional Budget Office have warned that the reduced tax receipts would blow a massive hole in the federal budget and jeopardize America's long-term fiscal outlook, but that hasn't stopped some prominent Democrats from getting behind the individuals tax cuts. Trump and his allies hope the prominent tax cut proposals will blunt Democrats' efforts to paint the One Big Beautiful Bill Act as a giveaway to wealthy GOP donors that will gut government services while only providing limited relief for working-class voters. To that end, the president and others in his camp have routinely taken to social media to argue that anyone who votes against the bill is effectively voting for tax increases because the legislation makes permanent a number of temporary tax cuts enacted in the 2017 Tax Cuts and Jobs Act, which Trump signed into law during his first term. Democrats, meanwhile, remain opposed to the bill's massive cuts to Medicare and other measures that make it harder for people to claim tax credits meant to boost lower-income Americans' bottom lines. Rep. Brad Schneider, an Illnois Democrat, told the Times that the whole bill had to be considered rather than any individual provision or provisiosn. 'Any one thing — a tax credit or a tax cut — might make sense, but you've got to take a look at the whole picture,' he said.
