The Trump Economy

[Foxx]

10 hours ago, Tiberius said:

Hyper inflation? Huh? 

 

Hey, where is the Tea Party, taxed enough already? Another $300 billion in taxes? Not a word from the Taxed Enough Already crowd, what frauds, what hypocrites 

try again Tibsey.

https://twitter.com/SteveScalise/status/1157287802939355138

 

[OldTimeAFLGuy]

7 hours ago, Koko78 said:

 

So you're now upset that people are paying their "fair share"?

 

...and how about those trapped in AMT and forced to pay MORE than their fair share?............

[TPS]

1 hour ago, Foxx said:

try again Tibsey.

https://twitter.com/SteveScalise/status/1157287802939355138

 

The average employment gain per month under Trump is 195,000. The average over Obama's second term was 212,000.  

Touting "a new record" for total employment is like me saying I set a new record for my age today....

[Thurmal34]

Who wants to play consecutive quarterly growth since 2009?

 

Who wants to play GDP growth over the last 6 quarters?

 

Does anyone want the actual truth?

 

 

[keepthefaith]

8 minutes ago, Thurmal34 said:

Who wants to play consecutive quarterly growth since 2009?

 

Who wants to play GDP growth over the last 6 quarters?

 

Does anyone want the actual truth?

 

 

 

What's your point?

[Thurmal34]

4 minutes ago, keepthefaith said:

 

What's your point?

 

My point is that you don’t want to deal in reality. Or do you?

 

COnsecutive quarterly growth since 09 not your kind of number?

 

Last six quarters of GDP growth not what you wanted to hear?

[keepthefaith]

10 minutes ago, Thurmal34 said:

 

My point is that you don’t want to deal in reality. Or do you?

 

COnsecutive quarterly growth since 09 not your kind of number?

 

Last six quarters of GDP growth not what you wanted to hear?

 

You haven't made any point.  Post some numbers and whatever it is you're trying to say. 

[Thurmal34]

5 minutes ago, keepthefaith said:

 

You haven't made any point.  Post some numbers and whatever it is you're trying to say. 

 

I’m not really sure where to go from here. 

 

The facts speak for themselves.

 

Are you afraid?

[TPS]

2012  181

2013  192

2014  251

2015  227

2016  193

2017  179

2018  223

 

2019 to-date = 165

 

These are the monthly averages (in 1000s) by year since 2012.  The past 2.5 years has been nothing special. 2018 was boosted by Trump's "deficit spending." The current trend is not so hot...

As I mentioned, he will have to buckle before the Chinese do.

[TPS]

 

This is an interesting tweet by Trump, but I don't think he's talking about tariffs here.  What he really should say is they are selling US lots of stuff, then using the dollars they get from their trade surplus to buy treasuries to keep the USD from depreciating against the yuan.  We get stuff, they get US paper.

[Buffalo_Gal]

1 hour ago, TPS said:

2012  181

2013  192

2014  251

2015  227

2016  193

2017  179

2018  223

 

2019 to-date = 165

 

These are the monthly averages (in 1000s) by year since 2012.  The past 2.5 years has been nothing special. 2018 was boosted by Trump's "deficit spending." The current trend is not so hot...

As I mentioned, he will have to buckle before the Chinese do.

So in 2008, 2009, 2010, etc how many jobs were lost that finally came back in 2012, 2013?  IOW how long until the base number of jobs came back to 2007 (I am just guessing 2007 was the high point, I do not know) levels?  Are there really more people employed now than ever before? Were there more people employed in 2015 than now?

I guess what I am looking for is if you crash, until you get back to where you were, you haven't gained anything regardless of how great the new jobs numbers are subsequent to that crash. And if smaller numbers are gaining on "highest ever" than that is a more difficult achievement than gaining on negative numbers (no where to go but up).

Oh, and another question - how do they count self-employed people? So, let's say that the economy was in the toilet in 2009 and 1M jobs were lost, but 500K of those people went on to be self-employed at a living wage.  Are those new jobs created? Counted as only 500K jobs lost? Or do they go into the ether?




 

Edited August 3, 2019 by Buffalo_Gal

[Tiberius]

15 hours ago, Foxx said:

try again Tibsey.

https://twitter.com/SteveScalise/status/1157287802939355138

 

Well, when you are spending a TRILLION a year in money you don't have, the economy better be doing something good! Trump is just leveraging out the country, then he will declare bankruptcy and laugh at the suckers that sort of elected him 

[3rdnlng]

Pretty much the real measure of the economy is wages. Anything else is hit or miss and can be explained away but when companies voluntarily boost wages it's because they have no other choice but to compete for labor.

[keepthefaith]

2 hours ago, TPS said:

 

This is an interesting tweet by Trump, but I don't think he's talking about tariffs here.  What he really should say is they are selling US lots of stuff, then using the dollars they get from their trade surplus to buy treasuries to keep the USD from depreciating against the yuan.  We get stuff, they get US paper.

 

Well that gives me comfort knowing the Chinese are willing to be best bidder for some of our debt and help us to fund the cocaine that drives our economy.  On the other hand their investment in our stable currency + 2% beats the ***** out of their falling currency.  All hail to Trump and Xi for making it happen. 

[Tiberius]

12 hours ago, Thurmal34 said:

Who wants to play consecutive quarterly growth since 2009?

 

Who wants to play GDP growth over the last 6 quarters?

 

Does anyone want the actual truth?

 

 

Yes! Tell us! 

[TPS]

2 hours ago, Buffalo_Gal said:

So in 2008, 2009, 2010, etc how many jobs were lost that finally came back in 2012, 2013?  IOW how long until the base number of jobs came back to 2007 (I am just guessing 2007 was the high point, I do not know) levels?  Are there really more people employed now than ever before? Were there more people employed in 2015 than now?

I guess what I am looking for is if you crash, until you get back to where you were, you haven't gained anything regardless of how great the new jobs numbers are subsequent to that crash. And if smaller numbers are gaining on "highest ever" than that is a more difficult achievement than gaining on negative numbers (no where to go but up).

Oh, and another question - how do they count self-employed people? So, let's say that the economy was in the toilet in 2009 and 1M jobs were lost, but 500K of those people went on to be self-employed at a living wage.  Are those new jobs created? Counted as only 500K jobs lost? Or do they go into the ether?




 

My point: focusing on jobs, saying we're at a new record, does not carry a lot of weight in an economy where the population is growing over time, hence my age comment.  

Let me also say once again, I am glad Trump used "deficit spending" (widening the gap between government expenditures and revenues) to stimulate the economy when unemployment was approaching what many economists thought was full employment--he helped blow a hole in the traditional view.  However, since most of the tax cuts go to the top payers, the impact is weaker since they spend less of any additional income.  Corporate tax cuts have also mainly been used to fund stock buybacks, though the 100% expensing of equipment gave a brief jolt.  As those stimulants have worn off, we're back to an economy not much different than what was going on the previous 4 years--my point. 

I believe I posted this graph at some point in this thread for the same reason:

 

To answer your question: the previous peak was Jan 2008 which was surpassed in May 2014.  Since then, there hasn't been much of a difference in the growth of employment. As I argue, Trump's second year was good because most of his stimulus  was done then.  Trump is also right to castigate the FED for raising rates, as that is what has caused most of the recessions since 1960.  Growth should continue as long as the FED let's it, but Trump's tariffs are also having a negative effect.  Unfortunately, he's playing a long game, but he's running out of time--the 2020 election.  The Chinese can wait him out. 

 

I have also given him credit here.  Changes in global production take time, so any positive gains from producers "insourcing" will be gradual.  However, most of the manufacturing that comes back will be capital intensive, requiring even less labor than in the past (this has always been the case for much of manufacturing).  Any amount is good in my view.  

 

The best thing for trump is if wages continue to rise faster, as wages and consumption by the middle class is the most important factor that will drive economic growth in the US. 

 

[Buffalo_Gal]

Some interesting stuff about job creation during the Obama "recovery" years.

From  Alen Krueger (in 2016) chair of the Obama White House Council of Economic Adviser: (2011-2013)
 

“We find that 94% of net job growth in the past decade was in the alternative work category,” said Krueger. “And over 60% was due to the [the rise] of independent contractors, freelancers and contract company workers.” In other words, nearly all of the 10 million jobs created between 2005 and 2015 were not traditional nine-to-five employment
 

</snip>

Link to "non traditional jobs paper"

I find that interesting. Apparently, not all jobs are created equal. (haha!)

Do FT jobs and PT jobs count equally for unemployment numbers? And, does anyone track a PT position (or two) being accepted in place of that FT position?
 

[3rdnlng]

1 hour ago, Buffalo_Gal said:

Some interesting stuff about job creation during the Obama "recovery" years.

From  Alen Krueger (in 2016) chair of the Obama White House Council of Economic Adviser: (2011-2013)
 

“We find that 94% of net job growth in the past decade was in the alternative work category,” said Krueger. “And over 60% was due to the [the rise] of independent contractors, freelancers and contract company workers.” In other words, nearly all of the 10 million jobs created between 2005 and 2015 were not traditional nine-to-five employment
 

</snip>

Link to "non traditional jobs paper"

I find that interesting. Apparently, not all jobs are created equal. (haha!)

Do FT jobs and PT jobs count equally for unemployment numbers? And, does anyone track a PT position (or two) being accepted in place of that FT position?
 

Because the numbers can be so subjective the best way to determine how the economy is doing is to see how wages are doing. Wages go up when the labor supply hits a point where companies have to compete for workers. If wages are growing then the economy is doing well. It sounds pretty simple because it is pretty simple.

[Thurmal34]

Yeah so why do we as Americans keep tying our economic status to what our exec does?

 

who wants to do deficit spending math?

[Thurmal34]

So bad, the morons. They will believe anything.

 

 

[TPS]

13 hours ago, 3rdnlng said:

Because the numbers can be so subjective the best way to determine how the economy is doing is to see how wages are doing. Wages go up when the labor supply hits a point where companies have to compete for workers. If wages are growing then the economy is doing well. It sounds pretty simple because it is pretty simple.

I agree with you here. There are no perfect measures of employment or unemployment, and the nature of the economy is always changing. One way to help those at the bottom is to push the economy faster via stimulus and, at the same time, berate the Fed so they don't put an end to it with higher rates.  Trump has done both. 

[Tiberius]

Oh boy...

 

China responded to President Donald Trump’s tariff threat with another escalation of the trade war on Monday, letting the yuan tumble to the weakest level in more than a decade and asking state-owned companies to suspend imports of U.S. agricultural products.

 

 

The moves antagonized Trump, who used Twitter to accuse China of “currency manipulation” which “will greatly weaken China over time!” He has previously criticized Beijing for not keeping to promises to buy more U.S. crops.

https://www.bloomberg.com/news/articles/2019-08-05/china-hits-back-at-trump-with-weaker-yuan-halt-on-crop-imports?srnd=premium

 

Guess Trump will be doling out more welfare payments now 

[TPS]

China can play the long game, Trump can't.  It will be interesting to see how the ego will back down without looking like he lost....

[GG]

On 8/1/2019 at 8:36 PM, TPS said:

It's pretty simple.  Given the bonds are issued in USD, the attempt to exchange pesos for USD would lead to a depreciation of the peso, increasing the price of imported goods.  The extent of the depreciation would depend on how many holders of USD would be willing to exchange them for Argentine pesos.  It takes two to tango. 

Advanced countries that issue debt denominated in their own currency do not face this constraint.

 

Ok, now how about you provide a concrete answer for why QE did not lead to inflation?   Explain the details, not some nebulous notion of the dollar's special status.  Give me the accounting and money trail....

 

So, if I understand your argument correctly, the US Treasury has no limits to money making capacity, but the Argentinian central bank is limited by investor appetite?  Are you saying that advanced economies, especially those that issue reference currencies enjoy special status that allow them more leeway than what fundamentals indicate?  Did you credit Chinese buyers of US Treasuries for keeping US yields low?

 

Nope, no contradictory logic at all.

 

I've been very consistent in my opinion of why QE didn't lead to real inflation, although the move was fundamentally inflationary.  There was still ample demand for US assets, especially as you point out the need by the Chinese to invest their trade surplus.  They are perfectly free to buy rubles, Euros & Argentinian pesos.  Why don't they?  Let's continue this discussion if the Fed runs out of time and can't organically unwind the balance sheet bloat.

 

[Tiberius]

3 minutes ago, TPS said:

China can play the long game, Trump can't.  It will be interesting to see how the ego will back down without looking like he lost....

Or if he digs in deeper! Maybe an embargo of all Chinese goods! 

[GG]

On 8/3/2019 at 8:02 AM, TPS said:

2012  181

2013  192

2014  251

2015  227

2016  193

2017  179

2018  223

 

2019 to-date = 165

 

These are the monthly averages (in 1000s) by year since 2012.  The past 2.5 years has been nothing special. 2018 was boosted by Trump's "deficit spending." The current trend is not so hot...

As I mentioned, he will have to buckle before the Chinese do.

 

There is a budget deficit in Trump's administration.  They did not deficit spend.  They allowed the private sector to keep more of what the private sector earned and removed thousands of regulations.

 

Please stop the insanity.  The government cannot create true economic growth!!

[GG]

1 hour ago, TPS said:

China can play the long game, Trump can't.  It will be interesting to see how the ego will back down without looking like he lost....

 

Define long.   You're assuming that Xi has more than 18 months to ride out an economic slowdown and rising unrest in Hong Kong that can spill over to the mainland.

[SoCal Deek]

1 hour ago, GG said:

 

There is a budget deficit in Trump's administration.  They did not deficit spend.  They allowed the private sector to keep more of what the private sector earned and removed thousands of regulations.

 

Please stop the insanity.  The government cannot create true economic growth!!

You didn’t build that! ?

[TPS]

1 hour ago, GG said:

 

So, if I understand your argument correctly, the US Treasury has no limits to money making capacity, but the Argentinian central bank is limited by investor appetite?  Are you saying that advanced economies, especially those that issue reference currencies enjoy special status that allow them more leeway than what fundamentals indicate?  Did you credit Chinese buyers of US Treasuries for keeping US yields low?

 

Nope, no contradictory logic at all.

 

I've been very consistent in my opinion of why QE didn't lead to real inflation, although the move was fundamentally inflationary.  There was still ample demand for US assets, especially as you point out the need by the Chinese to invest their trade surplus.  They are perfectly free to buy rubles, Euros & Argentinian pesos.  Why don't they?  Let's continue this discussion if the Fed runs out of time and can't organically unwind the balance sheet bloat.

 

Argentina is subject to the market for USD to pay its bonds that are issued in USD.  The US issues its bonds in USD and pays in USD.  You can't see the difference?

On inflation, you don't seem to understand what bank reserves are. 

1 hour ago, GG said:

 

There is a budget deficit in Trump's administration.  They did not deficit spend.  They allowed the private sector to keep more of what the private sector earned and removed thousands of regulations.

 

Please stop the insanity.  The government cannot create true economic growth!!

Solely done for your benefit....?

By injecting more spending than it takes out in taxes, government spurs greater wealth creation by the private sector--every debt is someone else's asset....

28 minutes ago, GG said:

 

Define long.   You're assuming that Xi has more than 18 months to ride out an economic slowdown and rising unrest in Hong Kong that can spill over to the mainland.

Longer than Trump can wait.

[GG]

2 minutes ago, TPS said:

Argentina is subject to the market for USD to pay its bonds that are issued in USD.  The US issues its bonds in USD and pays in USD.  You can't see the difference?

On inflation, you don't seem to understand what bank reserves are. 

 

If your logic held up, investors wouldn't care if Argentina issued more pesos which would be converted to USD to repay USD debt.  After all, it's as simple as the Argentinian central bank crediting the Argentine money center banks' reserves.

 

Bank reserves don't matter when investors don't accept your currency.  ie, see above.  

[3rdnlng]

2 hours ago, TPS said:

China can play the long game, Trump can't.  It will be interesting to see how the ego will back down without looking like he lost....

What if China loses much of its manufacturing base to countries like Vietnam and we purchase our cheap Walmart products from them? We are an important market for China and our agriculture products are needed. After all, soybeans do not grow on trees.

[TPS]

1 hour ago, GG said:

 

If your logic held up, investors wouldn't care if Argentina issued more pesos which would be converted to USD to repay USD debt.  After all, it's as simple as the Argentinian central bank crediting the Argentine money center banks' reserves.

 

Bank reserves don't matter when investors don't accept your currency.  ie, see above.  

Once again, the statement made was "countries that issue debt in their own currency can never default."  If you issue debt in another currency, then you are subject to constraints in the FX market. For example, If the US issued debt in yuan, I certainly would not make the same claim, nor would anyone else. 

Any country can certainly try and purchase those hard currencies with the currency they control, but you DO face a constraint on the other side of that exchange.  You're being disingenuous and creating a straw man argument trying to treat all countries the same.  Why do you think Argentina HAS TO issue bonds in USD in the first place? 

 

As I posted for you a second time, not all countries are alike, and the ultimate constraint they face in using "deficit spending" is inflation.  Advanced countries with excess labor and capital, and developed financial markets, have much more flexibility than others.    

2 minutes ago, 3rdnlng said:

What if China loses much of its manufacturing base to countries like Vietnam and we purchase our cheap Walmart products from them? We are an important market for China and our agriculture products are needed. After all, soybeans do not grow on trees.

I don't disagree, but it takes time to develop new supply chains.  Trump has until next year--the election.  Hell, the markets are yelling at him now to stop this shiz.

Soybeans grow in Brazil too....

[3rdnlng]

7 minutes ago, TPS said:

Once again, the statement made was "countries that issue debt in their own currency can never default."  If you issue debt in another currency, then you are subject to constraints in the FX market. For example, If the US issued debt in yuan, I certainly would not make the same claim, nor would anyone else. 

Any country can certainly try and purchase those hard currencies with the currency they control, but you DO face a constraint on the other side of that exchange.  You're being disingenuous and creating a straw man argument trying to treat all countries the same.  Why do you think Argentina HAS TO issue bonds in USD in the first place? 

 

As I posted for you a second time, not all countries are alike, and the ultimate constraint they face in using "deficit spending" is inflation.  Advanced countries with excess labor and capital, and developed financial markets, have much more flexibility than others.    

I don't disagree, but it takes time to develop new supply chains.  Trump has until next year--the election.  Hell, the markets are yelling at him now to stop this shiz.

Soybeans grow in Brazil too....

I know they grow there. Why was China buying them from us in the first place?

 

If China was convinced that Trump would win reelection then we would already have a deal with them. If Trump does not win then we'd better have someone win that will pretty much follow the same policies as far as trade goes. This trade correction had to be made. The theft of intellectual property has to be stopped.

[TPS]

9 minutes ago, 3rdnlng said:

I know they grow there. Why was China buying them from us in the first place?

 

If China was convinced that Trump would win reelection then we would already have a deal with them. If Trump does not win then we'd better have someone win that will pretty much follow the same policies as far as trade goes. This trade correction had to be made. The theft of intellectual property has to be stopped.

If you've read my recent stuff, then you know I don't disagree.  I am in the business of predicting what I think will happen...

The Chinese State can wait longer than Trump can, and it certainly seems in their best interest for Trump to lose 2020.  As a prediction, I don't think this is controversial.  

[GG]

14 minutes ago, TPS said:

Once again, the statement made was "countries that issue debt in their own currency can never default."  If you issue debt in another currency, then you are subject to constraints in the FX market. For example, If the US issued debt in yuan, I certainly would not make the same claim, nor would anyone else. 

Any country can certainly try and purchase those hard currencies with the currency they control, but you DO face a constraint on the other side of that exchange.  You're being disingenuous and creating a straw man argument trying to treat all countries the same.  Why do you think Argentina HAS TO issue bonds in USD in the first place? 

 

 

My entire point is that not all countries are the SAME.  That's why some countries can get away with far more fiscal irresponsibility, that has nothing to do with how the central banks fund the private banks' reserve accounts.  I'm glad you finally came around to agreeing with my point.

 

Argentina and Brazil have greater labor and natural resource capacity than Japan, yet they don't have the same credibility with investors.  So please stop with the textbook answers.  Developed financial markets is a nice way of saying that the government knows its place in the economy.

 

Quote

 

Solely done for your benefit....?

By injecting more spending than it takes out in taxes, government spurs greater wealth creation by the private sector--every debt is someone else's asset....

 

 

How did the government under Trump "inject" more spending than in the previous administration?   

 

The markets were more accommodating to Trump, because they understand that temporary government revenue shortfalls are better than unsustainable expense growth.   Both create a deficit.  One is better than the other.

 

There's nothing more disingenuous than insisting that all deficits are the same.

[3rdnlng]

5 minutes ago, TPS said:

If you've read my recent stuff, then you know I don't disagree.  I am in the business of predicting what I think will happen...

The Chinese State can wait longer than Trump can, and it certainly seems in their best interest for Trump to lose 2020.  As a prediction, I don't think this is controversial.  

Yes, they can probably wait longer than Trump but can they wait longer than the USA? That's the question here.

[keepthefaith]

5 hours ago, 3rdnlng said:

Yes, they can probably wait longer than Trump but can they wait longer than the USA? That's the question here.

 

Do you think that if Trump loses his successor is gonna stay on the same path with China?  Very doubtful IMO.  What I do think will happen is that these current events will convince many U.S. CEO's that China is not the best place in which to set up shop.  You can almost feel a cold war coming given the economic, technological and military rivalry that is developing.  I just don't see the Chinese being as accommodating to the U.S. than as we have been to say the Japanese and the Japanese auto industry.  That meaning that China is a lot less likely to welcome foreign companies to gain market share on their soil.  Their style has been to steal/copy or buy their way in (Lenovo and Ingram Micro) to markets. 

Edited August 5, 2019 by keepthefaith

[TPS]

1 hour ago, 3rdnlng said:

Yes, they can probably wait longer than Trump but can they wait longer than the USA? That's the question here.

To answer you and Faith, there is no doubt that the supply chains of the US companies that are producing in China have been changing and will change even more because of this.  The cost differences between manufacturing in China and the US aren't so great any more, and companies have gradually shifted. It is US Multinationals that caused most of the shift to China and other countries, so they do need a push by politicians.  

I doubt very much the next president will be as belligerent on this as Trump, which is why I predicted China would stall on this a couple months back. 

Maybe it started with Clinton, but US interests have pushed globalization and outsourcing for a long time.  When companies move, it's Wall STreet and shareholders that win, and workers lose.

[TPS]

1 hour ago, GG said:

 

My entire point is that not all countries are the SAME.  That's why some countries can get away with far more fiscal irresponsibility, that has nothing to do with how the central banks fund the private banks' reserve accounts.  I'm glad you finally came around to agreeing with my point.

 

Argentina and Brazil have greater labor and natural resource capacity than Japan, yet they don't have the same credibility with investors.  So please stop with the textbook answers.  Developed financial markets is a nice way of saying that the government knows its place in the economy.

 

 

How did the government under Trump "inject" more spending than in the previous administration?   

 

The markets were more accommodating to Trump, because they understand that temporary government revenue shortfalls are better than unsustainable expense growth.   Both create a deficit.  One is better than the other.

 

There's nothing more disingenuous than insisting that all deficits are the same.

Apparently you just aren't reading my posts very carefully, because I said it (all countries are NOT the same) long ago...

The reserve accounting EXPLAINS WHY QE DID NOT LEAD TO INFLATION.

 

A deficit occurs when spending exceeds tax revenue.  Here's where we differ: I believe It's the size of the deficit that matters (and of course the state of the economy when they occur); you believe it's more important whether they are caused by spending increases or tax cuts.  You believe that larger deficits caused by tax cuts lead to stronger growth than deficits caused by spending increases, but this supply side religion has never worked in practice--the evidence does not support it.  

 

Haha! Thanks for bringing Japan into this...who do you think holds the majority of their government's debt?

[Deranged Rhino]