Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Inflation and the Crazy Crypto Markets - 23rd Oct 21
Easy PC Upgrades with Motherboard Combos - Overclockers UK Unboxing - MB, Memory and Ryzen 5600x CPU - 23rd Oct 21
Gold Mining Stocks Q3 2021 - 23rd Oct 21
Gold calmly continues cobbling its Handle, Miners lay in wait - 23rd Oct 21
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Trump Debt Deficits Then and Now : What a Difference 3 Years Make!

Politics / US Debt Jul 29, 2019 - 01:35 PM GMT

By: MoneyMetals

Politics As investors look ahead to a likely rate cut next week by the Federal Reserve, gold and silver markets have been consolidating their recent gains.

A big move in metals markets could come after the Fed’s policy meeting next Wednesday. Of course, the magnitude and direction of the move will depend on what Chairman Jerome Powell and company do and say.

Central bankers are under immense political pressure to lower interest rates and resume purchases of government bonds. A recent downturn in manufacturing and home sales data may well give them cover to roll out new stimulus even as the stock market sits near a record high.


It remains to be seen whether stocks will be the primary beneficiaries of Fed easing. If investors fear the Fed is inflating to try to get out in front of an oncoming recession, they may rotate out of economically sensitive equities and seek inflation protection in hard asset related investments.

Congress and Trump Suspend Debt Limit, Jack Up Spending

One thing that is certain to continue inflating is government debt. On Monday, President Donald Trump announced he reached a grand compromise with Senate Majority Leader Mitch McConnell and House Speaker Nancy Pelosi on the federal budget.

In reality, though, neither side made any meaningful compromises when it comes to spending restraint. Instead, Republicans and Democrats came together to compromise the nation’s fiscal health by blowing through previously installed spending caps and raising the debt limit. That paves the way for another $320 billion in deficit spending.

Under the deal, the debt ceiling will be suspended until July 2021 – effectively taking it off the table as a campaign issue in 2020.

Many Republicans cheered increases in military spending while Democrats celebrated increases in pet social programs that the White House had once tried to put on the chopping block.

The budget President Trump originally sent to Congress contained numerous cuts to discretionary programs. The proposed cuts weren’t enough to balance the budget, but they were symbolically important to fiscal conservatives.

Now they are left with nothing to latch onto except perhaps the faint hope that if he wins a second term, Trump would engage in a budget fight with Congress and finally deliver on his promise to drain the swamp.

Some Republicans think the time to fight against wasteful deficit spending is now. The House Freedom Caucus is opposing the budget deal, as is Kentucky Senator Rand Paul.

For most members of Congress, though, the political price of standing in the way of spending is simply too great.

When Senator Paul insisted recently that that funding for 9-11 first responders be offset by spending reductions elsewhere in the budget, he got viciously attacked from all sides. The attacks were amplified by liberal comedian Jon Stewart and the mainstream media. At the end of the day, only one other Senator supported Rand Paul’s lonely campaign to stop new spending from being added to the national credit card.

Trump Railed against Debts and Deficits in 2016

Ironically, the budget deal that President Trump now backs represents exactly the sort of “bad deal” he railed against on the 2016 campaign trail.

Donald Trump: We have $19 trillion dollars in debt going very soon to $21 trillion because we made a bad budget deal. We have got a mess in this country. We owe $19 trillion. We owe $19 trillion as a country, and we're going to knock it down, and we're going to bring it down bigly and quickly. We're going to bring jobs back. We're going to bring business back. We're going to stop our deficits. We're going to stop our deficits. We're going to do it very quickly.

Campaign Audience: How? How? How?

Donald Trump: Oh, how? Are you ready? Number one, we have tremendous cutting to do.

Well, the national debt has since gone from $19 to over $22 trillion. Instead of dealing with it directly by cutting spending as candidate Trump had suggested, President Trump now aims to reduce the cost of servicing the debt.

He is pushing the Fed to lower interest rates and resume Quantitative Easing. He is also pushing for a weaker dollar to diminish the real value of the trillions we owe to ourselves and to foreign governments including China.

Republicans defenders of the deficit-expanding budget deal say it will help rebuild our military and enhance national security. But at some point, the skyrocketing national debt will itself become a national security risk to America.

JPMorgan Warns Federal Reserve Note Could Lose Status

Investment banking analysts at JPMorgan recently issued a report warning that the fiat U.S. dollar could soon lose its world reserve currency status. Trump administration officials appear to be worried about this prospect as well.

They fear adversarial countries such as Russia, Iran, and Venezuela will successfully circumvent U.S. sanctions using alternative trading channels such as Instex.

In the meantime, Russia and China continue to add steadily to their gold reserves.

If the dollar standard falls, then gold holders will be in a far more secure position than those that hold only promises issued by governments.

By Mike Gleason

MoneyMetals.com

Mike Gleason is President of Money Metals Exchange, the national precious metals company named 2015 "Dealer of the Year" in the United States by an independent global ratings group. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC, and his writings have appeared in hundreds of publications such as the Wall Street Journal, Detroit News, Washington Times, and National Review.

© 2019 Mike Gleason - 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.


© 2005-2019 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