Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Trump Racks Up More Wins – The Rising Deficit Isn’t One of Them

Politics / US Debt Jul 03, 2018 - 07:43 PM GMT

By: MoneyMetals

Politics

President Trump is winning on a number of fronts, and American conservatives are feeling better about their prospects than they have for a very long time.

Trump supporters are cheering an imminent shift in the balance at the Supreme Court. The President is expected to nominate a justice who respects the constitution to replace the retiring Anthony Kennedy. This legacy promises to endure for decades.


Americans’ taxes are lower. The President has pruned some regulations. He has exposed the deep state and the extraordinary bias in the establishment media.

And he has even taken the moral high ground away from the Social Justice left.

However, the President has somewhere between 2 and 6 years left in office and his agenda remains vulnerable. The economy may prove to be the President’s Achilles heel.

Trump has left a big opening for his opponents should the economy falter.

He is no longer critical of the Fed. He has embraced the phony rally in stocks and the low unemployment numbers. He no longer complains about easy monetary policy and the superficial nature of the economic recovery.

The Fed has caused both the private sector and the public sector to become addicted to debt. Trillion-dollar budget deficits are coming before the end of Trump’s first term.

It isn’t a good sign when Larry Kudlow, whom Trump recently appointed to the National Economic Council, isn’t even aware of the trend in federal deficits. He declared they were shrinking on Friday. The reality is the opposite:

Trump signed the most recent budget expansion, and he is taking credit for positive signs in the economy. He will 100% own whatever happens from here. Right now, that could be a dangerous proposition.

The US may not be able to avoid recession for another two years, let alone dodge a bigger reckoning down the road.

  • The current expansion is very long in the tooth, by historical standards.
  • The President’s trade policy, regardless of its merits, is likely to create headwinds for some sectors of the U.S. economy in the short run.
  • Rising interest rates are going to slow borrowing – the lifeblood of this economic expansion.
  • And, perhaps most dangerous, Trump has plenty of enemies looking for ways to take him down. A recession or economic collapse is one way to do it.

The last few months have shown the U.S. economic engine starting to stall. The equity markets, which moved relentlessly higher during the first year of the new administration, have faltered.

The S&P 500 closed at 2,718 on Friday, well below the 2,873 top set in late January. And last week the official estimate of first quarter GDP was revised lower, along with the forecast for second quarter GDP.

The last thing the President needs is to be blamed for a major recession – or something even worse.

By Clint Siegner

MoneyMetals.com

Clint Siegner is a Director at Money Metals Exchange, perhaps the nation's fastest-growing dealer of low-premium precious metals coins, rounds, and bars. Siegner, a graduate of Linfield College in Oregon, puts his experience in business management along with his passion for personal liberty, limited government, and honest money into the development of Money Metals' brand and reach. This includes writing extensively on the bullion markets and their intersection with policy and world affairs.

© 2018 Clint Siegner - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in