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The Trump Economy


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Trump = King of debt.   So much WINNING!  # 2

 

This is the scary sentence.   What happens if a new reserve currency replaces our USD?  We'd be in deep dodo.
I'm not an economist & I don't know how this all works , but I'm thinking  if China, Russia, Brazil, India created a new basket reserve currency it would drive the value of the USD down.

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Were America a country without a reserve currency, like Greece, we already would be facing an economic emergency.


 

https://thehill.com/opinion/finance/467825-trump-assumes-obamas-mantle-as-the-king-of-debt


 

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One of the central tenets of the Republican Party has been a commitment to fiscal conservatism, which consists of three central prongs: low taxes, low debt and small government. America’s burgeoning national debt, sprawling government bureaucracy and incredible burden of liabilities — that is, promises to pay in the future — seem to belie this set of ethics. 

So, when President Trump agreed to lower taxes as part of his economic plan in 2017, most Republicans thought it was a step in the right direction. We believed it was good for the economy and many signs, including our current state of full employment and robust stock market expansion, seem to bear that out. However, lowering taxes affects only one side of the government balance sheet. To be done responsibly, lower taxes must be accompanied by lower spending.  

And that is something the president has failed to do. This year, the U.S. national debt at roughly $22 trillion reached 100 percent of our gross domestic product (GDP) for the first time in American history. Despite the fact that our economy generates an incredible $20 trillion annually, we borrow at least that amount in addition to our income to finance our current expenditures. Were America a country without a reserve currency, like Greece, we already would be facing an economic emergency.

We once derided Obama as the “king of debt.” But at this point in his presidency, Trump seems to have happily inherited the mantle.

 

 

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4 hours ago, TGHusker said:

And that is something the president has failed to do. This year, the U.S. national debt at roughly $22 trillion reached 100 percent of our gross domestic product (GDP) for the first time in American history. Despite the fact that our economy generates an incredible $20 trillion annually, we borrow at least that amount in addition to our income to finance our current expenditures.

 

We've got to scale back on defense spending and stop fighting unimaginably expensive foreign wars against guys armed with rusty AK47s & kitchen knives.

 

When it comes time to draw up the budget, we hear there's not enough money for things like health insurance, health care, and social programs...but have you ever noticed how there's always enough money for bombs?

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6 minutes ago, Undone said:

 

We've got to scale back on defense spending and stop fighting unimaginably expensive foreign wars against guys armed with rusty AK47s & kitchen knives.

 

When it comes time to draw up the budget, we hear there's not enough money for things like health insurance, health care, and social programs...but have you ever noticed how there's always enough money for bombs?

I hear you.   Being the world's policeman takes it toll.  We do need to build relationships with countries without having to give away all of our budget. 

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15 hours ago, Undone said:

 

We've got to scale back on defense spending and stop fighting unimaginably expensive foreign wars against guys armed with rusty AK47s & kitchen knives.

 

When it comes time to draw up the budget, we hear there's not enough money for things like health insurance, health care, and social programs...but have you ever noticed how there's always enough money for bombs?


Yup always enough money for war and tax cuts for the rich. Always. 

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27 minutes ago, QMany said:

Another rate cut, Powell seems to be doing Trump's bidding to try to prop up this economy until the election.

Well, the economy is slowing down.  I don't think Powell gives a flying rip what Trump says.  He's doing what he feels is needed even though at first Trump hated and ridiculed him....and now is doing things that make comments like yours appear.  

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1 hour ago, BigRedBuster said:

Well, the economy is slowing down.  I don't think Powell gives a flying rip what Trump says.  He's doing what he feels is needed even though at first Trump hated and ridiculed him....and now is doing things that make comments like yours appear.  

But it the tail wagging the dog. The fed is supposed to make independent decisions on the economy. Since Trump decided to pump the system with sugar and spurred the economy short term should we not see the crash that likely comes from this. He has the right to say that interest rates need to maintain a minimum level since the economy is still doing well and only cutting the rate after retraction begins. Since he is doing it now, it may further crater the economy at a later date since we won’t have anywhere to go down when the market craters in the future with already near zero rates.

 

Trump borrowed all the money and now gets to bully the fed into cutting rates. He is politically swinging what options the fed have at their disposal and is making them less independent. 

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1 hour ago, deedsker said:

But it the tail wagging the dog. The fed is supposed to make independent decisions on the economy. Since Trump decided to pump the system with sugar and spurred the economy short term should we not see the crash that likely comes from this. He has the right to say that interest rates need to maintain a minimum level since the economy is still doing well and only cutting the rate after retraction begins. Since he is doing it now, it may further crater the economy at a later date since we won’t have anywhere to go down when the market craters in the future with already near zero rates.

 

Trump borrowed all the money and now gets to bully the fed into cutting rates. He is politically swinging what options the fed have at their disposal and is making them less independent. 

Ummm...I just said the fed is NOT doing just what Trump wants.  They are acting independent. He hated it when they raised rates.....they didn't care.  Now, there are signs the economy is slowing so they are lowering rates......even though it causes comments like this.

 

So....in my view....there is no "tail wagging the dog."

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2 hours ago, BigRedBuster said:

Ummm...I just said the fed is NOT doing just what Trump wants.  They are acting independent. He hated it when they raised rates.....they didn't care.  Now, there are signs the economy is slowing so they are lowering rates......even though it causes comments like this.

 

So....in my view....there is no "tail wagging the dog."

Unemployment is still extremely low, wages are stagnant as they have always been, and investments are at highs. That is an average view of economic conditions. Not good or bad quite yet.

 

So why do we need to cut rates? Because the economy is slowing from policies made by the executive branch unilaterally that is affecting long term growth potential and piling debt increases from the recent tax cuts. To continue to borrow at such extreme levels, the rates must continue to be so low as to not effect the ability of the government to potentially pay them back. If the fed were “truly independent”, they could look at the average conditions of the economy at this time, their backs on the backstop of potential ability to create future changes and say no change in interest rates. This would likely cause the economy to retract and force legislative changes to the budget. With the fed conceding their position, they are not being independent, but being pushed to action by congress and executive branch.

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8 minutes ago, deedsker said:

This would likely cause the economy to retract and force legislative changes to the budget. With the fed conceding their position, they are not being independent, but being pushed to action by congress and executive branch.

So, you want the feds to make decisions based on what they feel needs to be done with the budget.

 

That's not their job.

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47 minutes ago, BigRedBuster said:

So, you want the feds to make decisions based on what they feel needs to be done with the budget.

 

That's not their job.

No. This is their last card and they are playing it before the economy is really at a tipping point. That seems like the pressure got to them. 

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