“No tomorrow? That means there’d be no consequences. No hangovers. We could do whatever we wanted!” – Groundhog Day
An economist falls off a cliff. During the fall, he notes, “So far, so good. It’s different this time. Soft landing ahead!”
Note: no podcast this week. Hoping to have a new computer that can hear things as soon as my staff gets the specifications together.
Last week I let on that I thought a recession was coming. I mean, I always think a recession is coming, so that was no big surprise, but it looks like from preliminary data that the economy is actually contracting this quarter, so, if we match it with one more quarter of contraction that’s the textbook definition of a recession. Or maybe the economy is having a baby. I slept through that part of health class.
It is a long-used trick of sitting presidents to treat the economy like a 1980s high school kegger in order to get re-elected. The plan is generally simple: lower interest rates, make great big troughs of money available, and, bada-bing, the economy is bada-booming on election day and the cheerleaders are doing keg stands.
Nixon mastered this with his re-election bid in 1972.
Well, add the hangover from Nixon’s economic Everclear™ to the crude oil embargo (thanks, Israel) and the result was the miasma of suck that was the 1970s economy – stagflation. Every president has done some variation of this act since then, with varying degrees of success, but since 2000 or so, each president has tried to avoid all of the consequences of the Boozing. How? Boozing some more.
And I heard they were banning cheese in Great Britain. Or at least extra sharp cheddar.
I’m guessing that one can avoid a hangover by staying drunk all the time, though I don’t have personal experience in attempting that strategy. Although it is probably more enjoyable than a hangover, there are always consequences to replacing all of your blood with ethanol.
There is a difference with this current economic hangover that we’re working on because, first, we’ve been drinking soooooo long. Like I said, this has been going on since at least 2000.
So, there’s that. But that’s not the only thing impacting the economy right now.
Another major factor is Trump. I think, like many people, Trump sees the size of the national debt and knows that this can’t go on. He’s also a guy who has nothing at all to lose. He can shoot the Moon and try to go for all of it.
He’s doing exactly that. Tariffs? As I’ve written before, when the United States had tariffs, we were a strong economy with manufacturing. Post WW2, when we went away from tariffs to help the rest of the world rebuild out of the rubble? Not so much.
If Trump puts tariffs on Canadian goods, no one can say he has ties to Poutine.
Trump’s America also (so far) is an America that wants peace. For decades we’ve been shadowboxing against Russia, which is like Hulk Hogan™ attempting to defeat a room full of kittens. I mean, jeez, Hulk®, their eyes aren’t even open yet. Russia is not a threat to the United States. Except for the nukes.
Others want war, though. The neocons and people like Victoria Zoolander want war the in the Ukraine, probably because Russia gave them a wedgie in the 1980s or because they have Raytheon© stock. I saw one Canadian tweet, “Well played, Americans, look at all of the billions of dollars in weapons you won’t get to sell.”
To be clear, I’m all in favor of weapons, just ask The Mrs. when I make goo-goo eyes at a .50 cal. I think every father should be given their choice of an M2 or an M60. But to try to mock the United States for not getting profits on weapons that are killing people, right now?
That’s . . . disturbing.
Also as a factor, in Trump’s America government is likely to be D.O.G.E.’d into shrinking for the first time since we demobilized from World War II. When that happened, we transitioned more-or-less seamlessly into the economic boom of the 1950s, but it didn’t hurt that the rest of the world was like Sergeant Hulka: “All blown up, sir!”
This shrinking government sector will take the heat off of inflation in many things, but tariffs will raise prices. Where it ends up is uncertainty.
Who doesn’t like uncertainty? Wall Street®.
Physicists should never look down at their speedometers. If they do, they’ll have no idea where they are.
The final big factor in this recession is that the insiders who have been putting the Bacardi 151™ into the punch bowl for all these decades don’t want to help Trump. That’s probably a good thing. The more government meddling into the economy, the longer it normally takes to shake itself back into order.
I want the recession to be:
Short.
Sharp.
Cleansing.
Like hangovers, recessions are painful. They can wreck lives. But they are required to clean out the economy from time to time.
And the economy hasn’t been cleaned out in forever. Some areas where it really does need a bit of sprucing up:
- Government.
- Banks.
- Real Estate.
- Manufacturing.
- Education,
These spring cleanings will be painful. A lot of people in these industries are out there doing the important work of going to Zoom™ meetings and making PowerPoints©, rather than engaging in useless tasks like growing and making food, or fixing potholes, or picking up the trash.
So, yes, this is probably a recession coming. The Government-Media-Education complex will certainly try to blame Trump, just as they tried to blame him on day two that he hadn’t yet fixed all of Biden’s booby traps.
Is the most popular red wine in prison Penal Noir?
To be clear, Trump will be partially at fault, but if the result is a true cleansing of the economy? It will be worth it. Now, where’s that black coffee?
John your best post ever!
The recession is best done fast and hard so we can get it done.
Painful but it is the way (Wish I could put that Malroran meme here)
Thank you! More tomorrow on the same topic.
Remember Treasury Sec. Mellon’s prescription for the 1921 recession that set the stage for the Roaring 20s… “Liquidate, liquidate, liquidate.”
I see tariffs either as short term negotiating tool or as a whole different economic trade policy like in the late 1800s. We don’t really know how this will play out.
But the goal is vigorous US growth. I think Trump will make that happen.
Well, all the other countries heavily tariff US products, so I’m at a bit of a loss that it can be that dreadful. One-sided tariffs are obvious bad since one party can’t sell anything. Our GOV has encouraged this stupid position while encouraging jobs to move overseas.
I think he will. And so do the people who watched his speech: very positive on economic factors.
“To be clear, I’m all in favor of weapons, just ask The Mrs. when I make goo-goo eyes at a .50 cal. I think every father should be given their choice of an M2 or an M60.”
Nothing wrong with that. Heck I’ve done the google eyes over a pellet rifle. I’ve often wondered if it is ingrained in the male DNA to appreciate and understand weapons as part of the survival instinct. Women (and liberal men) don’t generally share this trait.
Agree with your choices but will pass on the M2 carbine as it isn’t left hander friendly. I shot one once and it tattooed me between the eyes with ejected brass.
Nooooo, the M2 “Ma Deuce” fifty.
My bad, I thought you were looking at a choice between the “practical” carbine and the not -so-practical M60. A lot of folks love the M1 and M2 carbines but I’m just not a fan. If I had that choice, I wouldn’t be able to afford the M60 and wouldn’t want the M2 carbine, so I’d probably buy a good slingshot.
I was thinking about getting the Barrett 50 at one point but each round costs six to seven bucks and most ranges around here won’t even allow them (and I can shoot 100 rounds of 22 rimfire for that price).
If you are going the Browning 50 route, you might as well go for the quad-50 option they used to mount on halftracks (I think it was the M45 option). One short burst and your life savings will be wiped out, but on the bright side, it will probably be the most fun 5 seconds you will ever experience.
Well, instead of Universal Basic Income, I was hoping for Universal Basic Ammo.
BUY SILVER
Yup.
We need to get out of the mindset that conflates high returns in the stock market with a healthy economy. Stocks seemed to be doing just fine under Biden, the S&P 500 went from 2584 in January of 2020 to 5881 last October before the election. Great for 401k accounts and making the wealthy even wealthier but the economy was anything but good for most people. In other words, what is good for Wall Street isn’t always or even often good for Main Street.
That seems like a good topic for a stand-alone post.
I used the wrong starting date, the S&P was at 3972 in January of 2021 when Biden took office
I remember a Gillette ad from the 1990 that said “I didn’t believe the Dow would hit 29 hundred, or I’d hit 30…”
I have no clue why I remember that, I guess it’s when 14 y.o. me saw stupid ads too much after growing up on Thundarr the Barbarian, rolling the score on Duck Hunt, shooting grouse or playing hockey.
Have no clue why I even posted this, really. Sometimes a touch of the ’tism is confusing.
Thundarr was awesome. His sidekick Arial was pretty hot too, and I know the writers probably struggled to keep it G rated for kids.
Keep ’em coming.
That is my next post, sort of. Let me know how close I am.
Stonks are for speculating, not saving, as they can go to zero. Gold, silver, land, these kinds of things can store value. People who were about to retire in ’99 or ’08 found this out the hard way.
Were you around when housing repriced itself in 2000 or especially 2008?
John – – The Trumpeter danced around this subject in last night’s State Of Dah DisUnion speech. Wish he had focused the bully pulpit on the need for catharsis after a binge…. Which you pointed out is painful but necessary.
Our citizenry is basically ignorant about economics even though they understand why we must follow our budget to get through the month. Shame that The Trumpeter did not hammer down on that point. I guess he wanted to crow his accomplishments on a captive audience since the propaganda media was not likely to tell truths that make their Libtard backers appear to be the incompetent petulant snobs that those vermin actual are !! !?
No one wants to hear that the medicine tastes awful, but everyone wants to feel better. Trump creates a reality distortion field. Who can say?
The problem is, recessions are like snowfall:
You never know how long they’ll last, nor how deep they’ll get.
Once the bottom drops out, everything from “correction” to “Great Depression” to “Financial Apocalypse” is on the table.
We’ve certainly more than owned and deserved any of the above.
And consumers wanting an economic reset are very like Christians: they say they believe in Heaven, but no one is in any great hurry to go through the transition required to get there.
Trump’s doing a great job in bringing on the correction, and DOGE is looooooong overdue medicine.
But unless he figures out a way to make the changes permanent, it’s all just a blip, which will go away in 4-12 years.
And ultimately, the only way to make government fit back inside the box it came in, is to start stringing up all the people trying to grow it.
Until someone has the stones to address that, nothing else will matter.
I’ve seen no conga line of FBI and CIA employees – let alone crooked congressweasels – being frog-marched to federal court or prison.
I see no illegal alien round-ups.
So this is just Day 46 of Nothing Is Going To Change (With Hyperventilation For Effect).
Call me when the mass arrests and hangings start.
And if things haven’t turned around economically by the mid-terms, this is going to be the biggest political bellyflop since Warren Harding or Herber Hoover.
Maybe we can send that “saved money” to Ukraine so Putin can get poked in the eye from us indirectly and then get “the noodle” from someone smart in his own country.
Otherwise they’ll be writing cyrillic in Belfast or something.
Beats the hell out of withdrawing back into our own hemisphere because we can’t “project power” with a carrier task force lest they become reefs, the coffers are empty and everyone is physically damaged from our own government.
Speaking gibberish is rarely a good effort.
We’ve been too broke to project anything like real power for decades, and spending fiatbux we don’t have on phony wars we never win (by design) hemispheres away, using IOUs drawn on our grandchildren’s paychecks. The last empire that tried that as ongoing policy collapsed and contracted so hard its vassal states all withdrew and joined the other side. There’s a lesson there.
Throwing away our means on every shiny thing since ever has left us with our current military, the smallest and weakest it’s been in real terms since the last time such a power vacuum directly triggered a world war in both hemispheres, and there’s no amount of fiatbux left to spend this time if it happens again. We can barely afford to pretend to defend ourselves now, and we’ve put off the corrections necessary to return us to solvency for so long that the cure now will very nearly be worse than the disease, and it’s going to take years to decades to come out the other end even with draconian belt-tightening.
Under those conditions, you’d better pray to God for dawdling enemies, and anything that lets us hamstring potential enemies on the cheap without committing us to open warfare anywhere is a bargain at ten times the price, because all we can afford is supporting proxy war(s) with our obsolescent castoffs. It’s 1934 all over again, and you’d better hope no one hands us 1941 until we can afford it. Google Lend-Lease and the purchase price of 50 obsolete destroyers sometime. And if we can trade leftovers for bleeding Russia too white to go off subjugating everything in reach, their available power will dwindle to the point they have to focus on their centuries-old traditional enemy. The one egging them into fighting and bleeding themselves white, while taking their only hard resources from them at bargain basement prices. Real friends don’t let friends fight drunk, nor send them back for another round after they’ve already got two black eyes, a broken nose and jaw, and multiple missing teeth.
Moreover, nations don’t have friends; they have interests.
So why is it, d’ya suppose, it’d be in both our interest, and China’s, to have Russia hamstrung and bled white?
Cui bono?
Work that one out sometime.
I’ve been thinking on your response.
My first paragraph might have confused you, as they are all talking points you have been spouting for… (checks calendar) 3 years now that we need to do everything short of boots on the ground to “stick a finger in the eye” of Russia.
Now you claim both: “We’ve been too broke to project anything like real power for decades, and spending fiatbux we don’t have on phony wars we never win (by design) hemispheres away, using IOUs drawn on our grandchildren’s paychecks” AND “We can barely afford to pretend to defend ourselves now, and we’ve put off the corrections necessary to return us to solvency for so long that the cure now will very nearly be worse than the disease” but yet “anything that lets us hamstring potential enemies on the cheap without committing us to open warfare anywhere is a bargain at ten times the price, because all we can afford is supporting proxy war(s) with our obsolescent castoffs”…
Then I saw on WRSA that summed up your position, whether you like it or not, in Crab Bucket 1 of this substack:
https://escapingmasspsychosis.substack.com/p/why-world-leaders-are-desperately
There was a point when there was enough excess productivity to con people in this nation to throw away the fruits of their labor towards Wolfowitz Plan empire-building, but that ship, as you point out yourself, left the docks and has been stranded on the beachfront of Kabul for years.
“And if we can trade leftovers for bleeding Russia too white to go off subjugating everything in reach, their available power will dwindle to the point they have to focus on their centuries-old traditional enemy.”
It sounds here like you share Russia as a “traditional enemy” much like the Kagan Clan.
I’m 100% Finn stock and your position is too retarded for me to get behind, my family left Europe 140 years ago to get away from this stupid shit.
It’s not worth canned sunshine here to “stick a finger in the eye” of Russia or Putin over there, or the middle east or asia.
We have to get well here, “physically strong, mentally awake and morally straight” as the saying went…
Nope, you’ve cleverly misunderstood and hopelessly misstated my position completely.
By the numbers:
1) I don’t hew to doing “everything short of” boots on the ground. We’re not Santa Claus.
2) But we do have huge annual surplus, and tons of stuff expires.
We – our military – throws metric f**ktons of stuff away every month. (For but one example, a simple one-day field exercise for an artillery battery burns enough gunpowder increments to launch a Tesla into orbit). So if you give me a choice between throwing our obsolete stuff in a boneyard or a dumpster, vs. dropping it on invading Russians anywhere on the planet, I pick B, eleventy times out of ten. Every dead Russian soldier now is one less to be found finger-banging world peace somewhere else six months later.
3) The first main reason Ukraine matters is because – careful, this may be shocking news to you – we have made defense assurances and outright guarantees to about 50 other nations on the planet. A lot of them vital to our strategic national interests. So throwing Ukraine under the bus, because those assurances are now inconvenient for us to fulfill, is using Clintonesque word-parsing, and Otter-esque Road Trip explanation (“You f**ked up: you trusted us!“) and laying it on with a level of bullsh*t that usually requires an entire herd of cows. It’s literally shooting our international weenie off, using a loaded minigun and a dumptruck-load of live rounds. It’s not just despicable, it’s criminally stupid.
4) The other reason Ukraine matter to us is because we literally lied and bribed them into surrendering a stockpile of Soviet nukes, including a prodigious quantity of SS-24 ICBMs, that would have made them the world’s third-largest nuclear power, ahead of China, by promising them their boundaries at that minute (1994) would be held inviolable, by all parties (us, Russia, and the UK) to that agreement. Signed, Uncle Sam, Ivan, and Tommy Limey.
Period. Full stop.
Reneging on that essentially tells the rest of the world, forever, that nuclear non-proliferation is so much bullsh*t, it’s idiotic, it’s criminally short-sided, and if it costs you your country’s future and freedom, well, that’s just too effing bad, because when we gave those “assurances” we were just joking. SUCKER!
Doing that is ringing the dinner bell for the Norks to make as many as they can, and for Iran to get some too, and anyone else who wants to, because only suckers give theirs up.
Coupled with #3, above, it tells all those other countries we testi-lied to about being shielded by America’s “nuclear umbrella”, that we will, just as with Ukraine, throw them under the bus in a heartbeat, and so if they value their independence and liberty, they should, by any means necessary, get nukes, get as many nukes as they can, and get so many nukes that they can credibly threaten any future enemy and all possible enemies with getting blown off the face of the earth, forever and ever, Amen.
The net result is to fire the starter’s pistol on a worldwide nuclear arms race that will make the Cold War look like it was run by Greenpeace.
So if you want a 150-nation nuclear arms race, and devil take the hindmost, by all means, throw Ukraine under the bus for believing our mendacious b.s. in 1994, because the world will be so much safer when instead of 10K or 20K nuclear weapons in the hands of nine nations, there are 500,000 nuclear weapons in 75 nations’ hands.
Please, make that case for us all to see, and kindly show all work.
Meanwhile, all those reasons I outlined?
“That’s stupid, it won’t ever come to that.”
Natzsofast, Guido.
https://raconteurreport.blogspot.com/2025/03/someone-needs-to-tackle-trump-seriously.html
POTUS is fulfilling the nightmare scenario faster than I can even lay it out.
Send in the clowns?
Don’t bother; they’re here.
1. No problem, sport. Point acknowledged, much like your prediction of Putin “getting the noodle” for the last two years from his own has been said repeatedly, all-in on Santa Claus not alled for.
2. All this ordnance that is “expiring” would probably be good to have OUR OWN troops get actual experience using and gain confidence. Ever see a MOPMS unit, much less used one? As a combat engineer I never saw a live one, much less saw one used. I know it was a quarter-million dollars for a Javelin controller when I got out 20+ years ago, never heard about live training and now the batteries are shot. Be nice to know if the shit you use works, and if it does it can go in strategic stockpiles instead of burnt up sticking a finger in someone’s eye.
3. and 4. The crux of the argument.
We have indeed signed all kinds of security agreements with all kinds of countries that are considered strategic when they were signed.
NATO is an example of this, as is the FACT the USSR and Warsaw Pact went away over 30 years ago. The strategic scenario changed, but the agreements are permanent?
When security arrangement in exchange for nukes was struck, did that include non-aggression on each side and neutrality for Ukraine?
Does a security agreement with a country remain in effect if the elected government is overthrown? How about if a people vote for autonomy, if not outright secession, are they still covered by the security agreement?
Did the security agreement cover all Ukrainians or just those the Ukrainian government sees fit to protect while it shells other Ukrainians it disagrees with while still insisting they are Ukrainians?
Do a people have the right to decide their own fate, or are borders, laws, rules, regulations and court judgments binding forever, no matter what the facts on the ground show or what can or cannot be proven?
In case you missed it, the recipe for nukes has been out there since, well, I guess the co-ethnics of Ukrainian leadership the Rosenbergs put it out there, followed by all kinds of scientific documents with the advent of the internet. Didn’t a kid build one for a high school science project?
That cat is out of the bag, and either they’re too complicated for a backyard project since none have gone off unexpected, or they’re fake and gay like most of your argument.
Ou use a lot of words building a scary world where the US government is a sane and earnest actor and we need to monkeywrench everyone so they don’t nuke us.
It would be a lot easier and cheaper to announce a worldwide pullback, state specific strategic goals that are absolute redlines with an annual revisit, and just trade with other nations with the nuke stick as a deterrent. Navy can protect areas of the sealanes if needed, and that is where mutual agreements come in.
Not being seen as an empire willing to kill everybody that looks askance is the first step to not getting pre-emptively nuked if getting nuked your big hang-up.
Now we’re struggling with reading comprehension.
1) I suggested Putin would get a Makarov Retirement Party if he reached for the nuclear launch phone. Or admitted defeat and debacle, turned tail, and threw himself on the mercy of the Politburo, or whatever they call his cabal of minions currently.
To date, he has done neither.
Suggesting he doesn’t have a suicide wish, and is chained to this war, bodily, at peril of his own death.
2) No argument that we shouldn’t be making more ordnance anyways, including sufficient to train with. I’ve only made that exact point, half a dozen times, at length, on my blog.
But you keep trying to mischaracterize what’s happened as “sticking a finger in Putin’s eye.”
That’s lying with half-truths.
What we’ve been doing is watching Putin get half of his ground combat strength destroyed in three years, dragging himself down to rough parity with a country he was formerly four times as strong as militarily, and ten times larger than in absolute terms. That’s yanking one of his eyeballs out, feeding it to him, and then starting in on his testicles with a chainsaw.
The nature of NATO is not germane to this discussion.
No neutrality was mentioned nor required; the only point at issue was Ukraine giving up nukes in exchange for security assurances from all parties. Subsequently, Russia invaded and annexed Crimea, then followed up by invading Donbas, and then Luhansk. The 2022 invasion was the fourth invasion of Ukraine by Russian forces. It hasn’t gone as well for them as the first three did.
Internal coups are internal. Russia used the one in Ukraine, wherein the Ukrainians tossed out their then-latest Russian puppet regime, as cover for Russia’s first three invasions. Obozo dithered. Unless you’re arguing the Ukraine re-obtained nuclear weapons, not having reneged on their agreement, our security assurances should have been honored, but we bitched out on them. At that point, if we were withdrawing those assurances, we should have given them their nukes back (or facsimile substitutes, including SS-24 generic replacements), and then stepped back to let Ukraine and Russia work out their disagreements honestly. Fair is fair.
When Russian troops enter another country’s sovereign territory, dressed as civilians, those troops are considered spies and saboteurs under international law, and the aggrieved nation is free to shell them and any collateral targets to its heart’s content, until they surrender, die, or depart. Russia chose to do none of those things. Under the Law of Land Warfare, the official response to that is “toughski shitski.” Russia elected to FAFO. They do not get to use that as a pretext to Bitch, Whine, and Moan later. They also do not get to hold kangaroo elections at gunpoint, claim they won, and pretend the occupied territory(ies) and citizenry have “seceded”. Nothing accomplished at gunpoint is valid, anywhere, ever. Bullshit walks.
How did past performance guarantee future behavior in 1929?
What about 1945?
How’d that work out in Russia?
China?
India?
Pakistan?
Israel?
North Korea?
How’s it working out in Iran?
How will it work out once we fire the starter pistol on the next nuclear arms race?
What crystal ball are you consulting?
We’ve been monkeywrenching the world so they don’t nuke us since we opened that pandora’s Box in 1945.
You’re argument is that we should reverse course, and see how things go when 100 nations have nuclear weapons.
But without showing us any reasons why or how that’s either sane, or rational.
Mainly because it’s 180° out from sane and rational, no matter how much you believe otherwise.
You want to trade one conventional regional war for dozens of conflicts, all of them with every likelihood to escalate to a nuclear exchange between toddlers armed with live grenades, despite the assessment, based on thousands of DoD war games, that once one nuke goes off, in short order they all do. “Psychotically delusional” is the kindest word for that level of rationale.
We haven’t nuked anyone in 80 years. But you’d have us become the world’s nuclear policeman, after first ensuring that everyone else in the discussion was armed.
Ignoring what happens when the next one to go off isn’t from an identified nation, but comes instead “To Whom It May Concern” on a nominal passenger jet, or a container ship from an uninvolved third party.
That’s exactly the drunken saloon cowboy approach that doesn’t prevent Armageddon, it invites it, and practically instigates it.
You’ve now demonstrated exactly the problems with unilaterally abandoning our suddenly-inconvenient security assurances to Ukraine, and firing the starter gun on every nation that can get them acquiring their own nuclear weapons.
Kudos.
Remember Seneca’s Cliff: it’s easier to burn down a house than it is to rebuild it.
This may be incorrect, but I have a gut feeling that when it comes to tariff history, you may be mixing up cause and effect. I personally don’t think that (a) we dropped tariffs and, as a subsequent consequence, (b) had foreign manufactured goods flood in. I think that American Big Biz deliberately moved manufacturing offshore in search of cheaper labor and then, as Part 2 of that plan, had tariffs dropped as part of their profit maximization to importing cheap goods THEY produced.
Low tariffs is Globalization in action. Example: Ford car plants in Mexico.
https://insights.tetakawi.com/why-ford-is-moving-their-plant-to-mexico
So Trump raising tariffs is by definition Populism striking out at Globalism.
The thing that gets me, and I’ve harped on this before in this forum, is that raising tariffs is not the way out of the Triffin’s Paradox facing America. (Well, by definition there is never any way out of a paradox, but in this case higher tariffs is an exceptionally stupid response). I’m not the only one that thinks so.
https://www.nomuraconnects.com/focused-thinking-posts/trumps-populist-policies-and-the-triffin-dilemma/
Basically the Triffin Paradox is that IF you are a global power and want your currency to be the world reserve currency ( which our dollar is, a good good good thing for us), THEN you gotta accept massive foreign trade deficits (and ours is approaching a trillion dollars a year, a bad thing) as the mechanism to get your currency in the hands of other nations so they can use it as the world reserve currency.
Trump looks at our huge trade deficit and sees it not as a consequence of global empire (which it is) but as a threat to American workers (which it is) and is gonna fight to bring that deficit down with higher tariffs. Good for American workers. Bad for our global empire – the other 95% of Earth’s population will respond by turning away from the American market to build more markets among themselves – which don’t need the American dollar as the reserve currency to facilitate this new trade. This is de-dollarization in action, which is a far greater threat to us than depressed wages from cheap foreign goods.
I don’t think Trump is enough of a strategic thinker to dip this deep into the spinning gears of international finance. I actually think that his tariff bombshells are just shock-and-awe to get immediate trade concessions from other countries, especially Canada, Mexico and China. No years-long trade negotiations for him!
So bottom line, I agree with you John, we need a cleansing recession, hopefully a short one that doesn’t turn into a true depression, and it’s pretty inevitable that we’re gonna get it. Trump’s tariff carpet bombing will come and go so he can claim victory over all the other countries he bent to his will. But America’s fiscal problems are so deep that even after a recession it’s still hard to see a way out. Tariffs are about now. A recession is about this year.
Our growing debt servicing bomb is the real problem in the decade to come. A major reset is coming. Let’s just hope it doesn’t involve nukes.
https://x.com/anadoluagency/status/1896893172862583045
https://www.statista.com/statistics/263127/military-spending-of-the-nato-countries-1990-2011/
Trump may not be cognizent of this, but whoever put in the USMCA (in effect July 1, 2020) that review would happen in 2026 might be.
If Trump put the date in, wouldn’t he have insisted on 2024 so he could see how it was affecting the US at the end of his second term and axe it then? (/conspiracy theory, those are never right)
Seems to be a lot more talk about gold lately, especially with the adjacent talk about crypto and such. King Dollar may stay on top just by being (still) the cleanest dirty shirt by chopping off the gangrenous leg of Globalism, or it might be a regional currency that the world still wants to flock to, or do business with. Either way global ambitions are hampered by having a peg leg.
Hydroponic farmland can be reclaimed into healthy, fertile soil but it will take a big doing since all those big fertilizer herds were slaughtered 150 years ago. There is still a lot of fertile soil that can feed our own, and probably enough to export after the rebuild.
I think it’s a mix. We didn’t have any competition, so if we offshored and built factories in Japan, the Wealth Pump could eat its cake and have it, too. Excellent point.
You are absolutely right, @Ricky. Most argument ostensibly for tariffs are nothing more than cheesy “post hoc, ergo prompter hoc.” Much as I usually agree with @John, he’s missed on this one. Might your childhood have been happier if your family had been able to afford real burger rather than Hamburger Helper? Post hoc says, no way, bucko.
Triffin’s Paradox is overrated, because it’s the flip side of Gresham’s Law. If you overproduce your currency, all buyers will want deals priced in your currency to get rid of it, and all sellers want the deal to be in some other currency. That’s why buyers in hyperinflated currencies would want to get paid every day so they could go shopping before the currency became worth even less. Empirically (and analytically) the deal tends to be priced in whatever is a major currency somewhere under the average for inflation/profligacy.
If tariffs are justified on the “infant industry” argument, they damn well better be right. Because if there is something more fundamental at work, like government policy, those “infant industries” will never be profitable to drop the tariffs. Never. To the permanent detriment of society. You would be better off just destroying the goods as they leave the factory.
For most of the country, we’re still “enjoying” the fruits of the Great Recession (2008 – current year).
Yup. As they hollow out the place.
I’d have to go with the M60 over the M2–I at least have a chance of affording some .308, but .50 Cal. is out of my budget.
If I had the money and the real desire, I’d get one of the new belt-fed 5.56’s out there. Valkyrie makes an updated Stoner ’63. Even FN has a lightweight, belt-fed 5.56 now.
But what if you’re attacked by engine blocks?
.243 Henry “Long Ranger”
Solid copper .243 is available in a variety of weights/velocities.
Nice.
> when the United States had tariffs, we were a strong economy with manufacturing.
Such as, when the North was running the entire federal government on tariffs collected from Southern agricultural exports. Being a parasite was so much fun they raised tariffs even higher. That’s the American experience you want to repeat?
> Post WW2, when we went away from tariffs to help the rest of the world rebuild out of the rubble?
You mean, Americans selling their manufactured goods to populations whose factories they’d just finished making an unforced error to bomb? Golly those Americans were kind-hearted.
Well, I will say that the brand-new factories gave both Germany and Japan a huge technical advantage in steel production.
Recession lol…there is a default being planned.
IMHO it could be a good thing. We couldn’t borrow without selling paper, and maybe leave empire behind ans start making stuff again.
Yup, I’ve heard the rumor that Treasury Notes belonging to folks outside the US won’t bear interest. That would be default.
GDPNow used to be a very accurate estimate of the current quarter’s GDP. However, Joe touched it around 2022. He has the anti-Midas touch that turns everything into crap. Predictions completely in disagree with general observation. Of course, the FED has lied about the GDP for a couple of decades that I experienced.
So negative 3% is just more propaganda — trying to self-fulfilling.
Could be. But I can keep dreaming of a Washington, D.C. streetcorner with a guy holding a sign, “Will lobby for food.”
Whatever the conditions are, there is simply too much debt, public and private. When cascading events of margin calls, short selling rip offs, and bond dispensing (as in not paying what is owed for bonds) spills over into the debt destruction, we’ll get the perfect, well earned trifecta of too much owed, with worthless currencies, and too many obligations. Talk about your Great Reset. Get prepared. And learn how to do things.
Yes. I notice that the restaurants around here are mostly empty now. People remembered how to cook.
The “keep drinking to avoid a hangover” method is an actual technique according to Ozzy Osborne. He recommends resuming drinking the second you wake up. The caveat, however, is that the longer you put off that hangover, the worse it’s going to be when it finally catches up.
(This might explain his obvious brain damage–that final hangover must have roasted half his synapses.)
Yup – but, he’s still alive, right?