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ZeroHedge reported the following two trade-related reports, the first by Jim Rickards and the second by Curt Mills:

Now, A Trade War; Next A Shooting War?

August 8, 2017

A popular thesis since the 1930s is that a natural progression exists from currency wars to trade wars to shooting wars. Both history and analysis support this thesis. …

The new currency war began in January 2010 with efforts of the Obama administration to promote U.S. growth with a weak dollar. By August 2011, the U.S. dollar reached an all-time low on the Fed’s broad real index.

Other nations retaliated, and the period of the “cheap dollar” was followed by the “cheap euro” and “cheap yuan” after 2012.

Once again, currency wars proved to be a dead end.

Now the trade wars have begun. On Thursday, July 27, the U.S. Congress passed one of the toughest economic sanctions bills ever and sent it to President Trump for signature. Trump signed it, although not enthusiastically. …

In effect, this law handicaps Russia’s efforts financially and technologically and weakens its grip on global energy markets.

Russia has already vowed to retaliate. …

Meanwhile, the long-expected trade war with China has begun at last. …

By November, the U.S. will label China a currency manipulator, which will start another review process, leading to still further sanctions. Like Russia, China will not take any of this lying down but will retaliate with its own sanctions, tariffs and bans on U.S. investment in China. Get ready for an all-out financial war between the U.S. and China.

This trade and currency war will shake markets and be a major headwind for world growth.

Germany is also in the crosshairs because of its huge trade surplus. Trump has already torn up the TPP trade agreement and has put Canada, Mexico and South Korea on notice that their trade deals need to be renegotiated.

None of these trading partners will stand still for this U.S. assault on bilateral trading relations. Retaliation can be expected. A full-scale trade war is now upon us.

Next comes the shooting war with North Korea, which will inevitably draw in Russia, China, South Korea and Japan. This will be tantamount to World War III.

As Mark Twain reputedly remarked, “History does not repeat, but it does rhyme.”

Today looks like a replay of the 1930s. Let’s hope things do not go as far as they did then. http://www.zerohedge.com/news/2017-08-08/now-trade-war-next-shooting-war

Will Europe Rebel Against U.S. Sanctions?

August 8, 2017

In comprehensively punishing Moscow, Washington risks further cleaving itself from senior European leadership. …

“Europe’s opposition to the sanctions is troubling. You can’t on one hand ask for a bigger U.S. military commitment to the continent while on the other hand oppose nonmilitary coercive measures,” Boris Zilberman, a Russia analyst at the Foundation for the Defense of Democracies, told me. A central plank in Europe’s concern is energy—the continent is quite reliant on Russian energy (something Ronald Reagan famously warned the Europeans against during the Cold War). “It is déjà vu all over again. Back in the 1980s the Reagan administration targeted Soviet energy exports, specifically pipeline projects. Europeans saw it as a double whammy for them, undercutting their energy security and—given potential secondary sanctions on many firms involved—penalizing their companies,” says Clay Clemens, an expert on German politics at the College of William & Mary.

In particular, a project called Nord Stream 2 between Europe’s central player, Germany, and Russia’s controversial energy company Gazprom could be affected by the sanctions. …

a United Kingdom official told me, indicating London didn’t find the legislation abrasive and praising the sanctions for emphasizing “the importance of transatlantic unity.”

But elsewhere in Europe, including in the EU leadership, there is great concern. In startling language Wednesday, European Commission president Jean-Claude Juncker, of Luxembourg, appeared to treat the U.S.-Europe alliance as a potentially open question. “The U.S. Congress has now also committed to only apply sanctions after the country’s allies are consulted. And I do believe we are still allies,” he said in a statement, with his office noting that “if the US sanctions specifically disadvantage EU companies trading with Russia in the energy sector the EU is prepared to take appropriate steps in response within days.” “We are prepared,” Juncker told a Brussels radio station Wednesday. “We must defend our economic interests vis-à-vis the United States. And we will do that.”

The German establishment is apoplectic, directly accusing the United States of trying to enrich itself economically—the sanctions are paired with provisions encouraging Europe to buy U.S. natural gas. In the era of President “take the oil” Trump and an Exxon Secretary of State, some are suspicious of American motives like never before. “One is left with the sense that the United States is looking to its own economic interests,” Volker Trier, the head of the German Chamber of Industry and Commerce, said last week. In the 1980s, “there was also a sense that the US sanctions were designed to reduce competition for American energy exports,” Clemens noted to me.

Wary of bucking Germany, France has also expressed reservations about the sanctions. http://www.zerohedge.com/news/2017-08-07/will-europe-rebel-against-us-sanctions

While what may happen with North Korea is not WWIII, we are seeing the stage being set for a trade war, and ultimately one or more real wars.

The fact that the United Kingdom (referred to as London in the report above) is on-board with the US sanctions and the EU is not, shows a growing unity of the USA with the UK and a growing separation from the EU. An EU that is trying to protect its trade with Russia.

Combine this with that fact that yesterday, we reported another non-Church of God author claiming that Germany, because of this sanctions bill, will stand against its Anglo-Saxon enemies (see ‘Imperial Folly Brings Russia And Germany Together’).

Furthermore, last week, some European leaders claimed that Europe would actually ‘win’ a trade war with the USA (see Martin Schultz blasts Donald Trump: Some EU leaders believe they would ‘win’ a trade war with the USA).

While the mainstream media in the USA keeps focused on Donald Trump and alleged collusion with Russia, the Europeans and Russians are focused on their respective interests.

Now what about the view that trade wars can lead to real wars?

Trade disputes are likely to be a factor that will lead to World War III.

As regular readers of this page are aware, the idea that we could be looking at a coming trade war is not a new one. Part of the reason for World War II was essentially a trade war, that turned into an actual war between the USA and Japan.

Over thirty years ago, Gene Hogberg of the old Worldwide Church of God wrote the following:

Prepare for Trade War

THE Free World’s 40-year period of unprecedented prosperity may soon come to a crashing halt. Support in the United States — the West’s leading trading nation — for maintaining free trade is crumbling fast.

Instead, there reverberate in the halls of Congress warnings to trade partners to open markets or face the retaliation of heightened tariffs and quotas. …

Mr. Reagan is painfully aware of where unbridled protectionism could lead. In recently rejecting a protectionist plea from one industry, the President evoked memories of the Depression — era Smoot-Hawley Tariff Act. “Some of us remember the 1930s, when the most destructive trade bill in history, the Smoot-Hawley Tariff Act, helped plunge this nation and the world into a decade of depression and despair,” he told a radio audience. “From now on, if the ghost of Smoot-Hawley rears its ugly head in Congress, if Congress creates a depression — making bill, I’ll fight it.”

But the ghost is rising, and support for the President’s trade policy is waning, even from those within his own party.

What Smoot-Hawley Did

Just how disastrous was the Smoot-Hawley bill? The devastating role it played in the Great Depression was explained in the September 5 issue of The Wall Street Journal, in an article written by its editor, Robert L. Bartley. “The stock-market crash of 1929 came in the midst of debate in Congress over the tariff,” wrote Mr. Bartley. “It had spent the year adding item after item to the protection list. In mid — 1930 the Smoot-Hawley Bill became law, with the highest tariffs in the nation’s history.” What might have been an ordinary correction, continued Mr. Bartley, “turned into the Great Depression…. As the international accounts closed down, the world economy choked.” …

Dangerous Security Changes

Other experts warn that American political leaders — responding to calls for immediate competitive relief from their constituents — may be ignoring another lesson of the Great Depression: that the severe contraction of world trade gave added impetus to imperialist surges in Asia and Europe, specifically Japan and Germany.

Since 1945 Japan has chosen the mercantile road as its path to power, prestige and national restoration. Germany, specifically the Federal Republic of Germany, is heavily dependent upon world trade, exporting a full third of its manufactured goods.

Access to the U.S. market is central to the economies of Japan and the other nations of the Pacific Basin, writes National Review executive editor John McLaughlin, “and hence perhaps to their stability.” If protectionism takes hold, what would happen to Japan and to Western Europe, whose economic heart is in Germany? Protectionism, leading to a full-blown trade war, would likely break the extensive joint defense relationships between the U.S. and its primary World War II foes, now allies for the past 40 years.

Americans should then prepare to witness the emergence of a nuclear — armed Japan as well as a nuclear — armed united Europe with Germany at its core. It’s doubtful whether the American public and its elected representatives have thought out the likely end results of actions now under way.

Former Senate majority leader Howard H. Baker Jr. sounded this warning: “The disastrous Smoot-Hawley Tariff Act of 1930 was rushed through Congress… and it took 14 years and a world war to straighten out the mess.” (Hogberg G. Prepare for Trade War! Plain Truth, January 1986)

While his basic impression of timing was off, it is correct that trade issues will be a factor that will trigger WWIII. A war that will be against the USA, Canada, and UK by a power that will reorganize (Revelation 17:12-13) and further rise in Europe. A Europe that is angry at the UK for Brexit and one that is mad at the USA for a host of reasons (including decisions of its former President Obama, statements by its current President Donald Trump, and the sanctions bill passed by the US Congress) will one day take steps.

There is a cost to trade wars and sanctions. Those who think otherwise are fooling themselves.

Trade wars have been listed as part of the Twelve ‘grey swan’ events to watch for in 2017.

We also put together a YouTube video recently titled Trade Wars: Are COG warnings coming to pass?

We are seeing more in Europe turn further away from the USA. The fact of Brexit and the UK’s support of USA sanctions is moving the Brits closer to the USA, and farther from the EU, on trade.

Massive shifts in trade and international alliances are beginning to take place.

A real war between Europe and the USA (with the UK basically on the USA’s side) will come as one day Europe will take steps to ‘eliminate the competition’ so to speak (cf. Daniel 8:25; 11:39; USA in Prophecy: The Strongest Fortresses).

Europe feels that it can deal with Russia and is not pleased with USA interference.

The Europeans and Russians have been openly discussing ideas, for years, to cut the United States out.

Germany’s Adolf Hitler and the then Soviet Union’s Joseph Stalin made a deal together which helped pave the way for World War II. The time will come when the Europeans and states in North Africa and the Middle East make a deal paving the way for World War III (WWIII) such as is described in Psalm 83. It is also likely that the Russians and others in Asia will also make some type of deal with the Europeans related to WWIII–a deal that will result in the end of the USA and its Anglo-Saxon descended allies.

As hard as that may be for many to believe, we keep seeing steps that are moving in that direction.

There is also fallout from a US pushed sanctions bill against North Korea:

August 8, 2017

President Trump’s biblical-sounding warning Tuesday that North Korea would risk “fire and fury” if it continued to threaten the United States inspired a chain-reaction of apprehension, alarm and gallows humor online. …

Trump spoke after a North Korean statement threatening “physical action” in response to new United Nations sanctions. …

“North Korea best not make any more threats to the United States. They will be met with fire and fury like the world has never seen. [Kim Jong Un] has been very threatening beyond a normal state and as I said, they will be met with fire and fury and frankly power the likes of which this world has never seen before.”

If you parse this statement precisely, you might conclude that Trump was threatening a U.S. attack (perhaps even a nuclear attack?) if Kim did no more than continue to make threats.

That indeed would be an ominous interpretation, but Trump is not known for the precision of his language. It seems more natural to regard his admittedly apocalyptic language as a response not to verbal threats from North Korea but to the possibility that those threats might be carried out. http://www.latimes.com/opinion/opinion-la/la-ol-trump-korea-20170808-story.html

August 8, 2017

North Korea’s military said, in a statement carried by state-run KCNA, it would carry out a pre-emptive strike against Guam if the U.S. provoked Pyongyang, according to a report from Reuters. …

Earlier Tuesday, President Trump said he would unleash “fire and fury” on North Korea if it threatens the U.S. with its nuclear weapons program.

Trump’s threat to North Korea came hours after Pyongyang escalated its criticism of the U.S. and threatened to conduct another missile test in response to sanctions the United Nations Security Council unanimously approved on Saturday. http://www.washingtonexaminer.com/north-korea-threatens-missile-strike-on-guam/article/2630967

Whether Kim Jong Un or Donald Trump will strike first is a question. But this looks like a case where a trade-restricting bill may lead to a real military conflict this year.

While that type of war will NOT happen with the USA and Europe during the first term of Donald Trump’s Administration, in time we will see the Europeans more willing to use military force to get what they want from the USA (cf. Daniel 11:39).

History continues to show that trade wars can lead to military ones.

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This entry was posted on Tuesday, August 8th, 2017 at 2:00 pm and is filed under Prophecy.

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