The Trump Economy

[BillStime]

Always lookin to distract - it is the Trumpian way!

 

 

[HillaryClinton]

24 minutes ago, BillStime said:

Always lookin to distract - it is the Trumpian way!

 

 

 

Are you a junkie?

[B-Man]

 

 

I HAD MISSED THIS STORY:

 

 US manufacturing soars to a 15-month high. 

 

 

Weird that it didn’t get more press.

 

 

 

 

[BillStime]

 

[GG]

On 8/3/2020 at 7:36 AM, RealKayAdams said:

 

It technically depends on what B-Man is referring to when he says “Obama’s policies.” There are Obama’s first-100-days Keynesian crisis escape policies (~$800 billion ARRA, Fed Reserve manipulations of interest rates/monetary supply, etc.) which all credible economists agree most definitely helped (but ended up being not nearly enough, in my opinion), and then Obama’s general post-crisis neoliberal economic policies that defined his last 7 years in office. I assume B-Man is referring to the latter, in which case my roundabout answer is “yes, B-Man is correct.” It's widely agreed upon that the Great Recession lasted 6 economic quarters from January 2008-June 2009. We’re using the mainstream definition of a recession here as at least two consecutive quarters with a decline in GDP.

 

Important side notes: Obama should have done WAY more in early 2009. Way tighter regulation of Wall Street, actual criminal prosecutions of bankers, more oversight of the big business bailouts and the real estate industry, bottom-up stimulus support for Americans, and way more federal protections for homeowners. These early missteps, in addition to 7+ years of neoliberalism, are what truncated the recovery even though I give Obama credit for doing the bare minimum to clean up what was largely Bush’s mess and stabilize the economy. These economic shortcomings are what set the stage for the populist political uprising of 2016, which continue today. The Great Recession “recovery” is also an excellent lesson in the shortcomings of popular singular economic metrics like GDP, which do nothing to tell the story of how blacks, Latinos, Millenials, and whites without college degrees have fared overall during the past 12 years.

 

 

100% in agreement here, but I have a comparative opinion of Trumponomics that is not so flattering for President Trump, either. I take Obama’s last 12 quarters and Trump’s first 12 quarters when making this economic comparison because that keeps the analysis the furthest removed from the Great Recession and Covid-19. Using standard economic sources (NBER, BEA, BLS), I rate Trump as better on consumer confidence, about the same as Obama with unemployment decline rate and stock market growth rate and net job growth and cost-of-living-adjusted wages/income and GDP (Trump originally over-promised quarterly 5% but never got much above 3%), and worse with import/export trade balance and budget deficits/national debt (but like I said earlier, I don’t get worked up over this one like deficit hawks do).

 

 

In “defense” of Obama, we’ve seen our fair share of crony capitalism (or rather, socialism?) throughout the tenures of Bush (such as fall 2008 TARP), Trump (such as 2017 TCJA and CARES), Clinton, and most who have been in Congress. I have to look over HEROES again and check out the HEALS Act proposals, but I’m sure there’s egregious pork in them too. Yes, I’m a deeply cynical person!

 

 

Sure, but then again we already know about the GOP’s cult-like devotion to supply-side economic ideology. And amusingly enough, the one HEALS pandemic remedy McConnell is advocating the hardest for is the corporate coronavirus liability protection (the right call, though, to be clear…but amusing nonetheless).

 

What’s far more interesting to me is how the Democrats are responding in the ongoing HEALS negotiations. Especially the obsequious clown car known as the Progressive Caucus (Bernie, the Squad, Khanna, Porter, Meng, Jayapal, etc.). We’ll see if Pelosi, Schumer, and the Dems are more interested in helping the American people or in playing partisan theatrical roles as Trump contrarians and GOP obstructionists. My central thesis and PPP raison d’etre: America is actually controlled by a one-party corporate oligarchy, with two flavors depending on your tastes for personal/social freedom issues. The oligarchy takes advantage of economic and foreign policy crises to increase their wealth and power. They couldn’t care less if small businesses fail and people lose their homes during this pandemic because then they can buy ‘em all up at discount prices in 2021. We shall see…

 

So far I’ve heard that at least the $1200 stimulus won’t be a point of contention, but that there’s been virtually zero Dem movement on the following: foreclosure/eviction moratorium, fed aid to state and local governments that will otherwise need to cut payroll, a payroll tax that could help workers and small businesses, and Covid-19/general health care relief for the recently unemployed. I don’t think the Democrats have been pushing hard for an approximate $600+ weekly unemployment benefit extension, either. In my non-expert opinion, they should be doing so because it has likely been boosting consumer spending all summer and I bet also keeping many working class families afloat (the first time making living wages for some?!). From a macroeconomic perspective, the value of this extension would far outweigh the enablement of a small percentage of lazy people from going back to work (not to mention the easy political points to be scored with the Dems’ constituencies!). I’m assuming the job applicant to job opening ratio is currently uncomfortably high in most sectors of the economy, although I honestly haven’t seen a full July numbers report on weekly new unemployment claims, furloughs, layoffs, permanent job losses, and new job creation to say so with any certainty. This is among the most serious crises our country has ever faced and one that economists have never quite seen before, so I will continue to preach the importance of both political parties erring on the side of caution and going full Keynesian on historically tried-and-true recession recovery policy.

 

 

Agreed. This quarterly GDP number can’t really tell us much beyond the fact that an unprecedented nation-wide shutdown of the economy during a historic pandemic caused an unprecedented drop in economic activity. Well…duh. The 2020 Q3 number will be much more meaningful and will give us a much better idea of where exactly the economy may be headed. HEALS might buy us some more time, but my best guess is that the poop hits the economic fan in 2020 Q3. An economic depression could even be declared as early as 2020 Q4, depending on the unemployment rate. Seems like talk of a v-shaped recovery has disappeared? Is reality sadly sinking in for a lot of people?

 

 

That’s a good historical analogy. In poor Mr. Hoover’s defense, everyone back then had so much less economic data to study and learn from, compared to what we have now. The true prisoners of the modern-day GOP’s economic ideology are its populist coalition of economic nationalists, particularly the sub-$60k median household income Rep voters who have been led to believe that the wealth has been trickling down. The economic libertarians are the ones who control the GOP and will continue to do so after self-aggrandizing faux populist hero, Donald Trump, is gone. There’s no reason for professional and managerial GOP types to question the 40-year-old edifice of an economic philosophy designed to work magnificently for them, so any ideological challenge will have to come from the GOP working class. The problem here is that any and all economic woes will easily be blamed on Covid-19 and/or Joe Biden and/or even Trump’s personal foibles, so we should expect a bare minimum of another 2 presidential election cycles before an internal GOP working class revolt occurs…if ever. More likely, this GOP voting bloc will just skip on over to the Dems, whose own internal working class revolt could begin as early as 2022…um…if ever??

 

 

No problem, so long as fully opening up the economy ASAP is not thought of as a panacea for the recession. As Covid-19 goes, so go economic activity levels. Until there’s a vaccine or until herd immunity is somehow reached, we’re stuck with a limited set of solutions: modified partial reopenings in many sectors of the economy, more government-issued economic stimuli, and the usual health and safety practices (social distancing, face masks, hand sanitizers). Economic uncertainty is our new reality for at least the rest of 2020.

 

 

Unfortunately they’re not lying. Annual rates are the traditional way GDP quarterly reports are given in the US. Misleading? Yes, since the more tangible number is about a 10% total macroeconomic contraction from 2020 Q1 to 2020 Q2. Intentionally misleading? Possibly. Bigger numbers are scarier than smaller numbers and can be used to promote agendas. But there’s no need for us to kid ourselves about the state of the economy: this GDP drop was historically awful. 2020 Q1 dropped at an annual rate of 5%, 2020 Q2 dropped at an annual rate of 33%, and so now we’re in an official recession.

 

There's a lot to unpack here.

 

I won't go in length about comparing the Obama & Trump approaches to the private sector, but urge you to revisit the OP in this thread.  In summary, Obama's inexperience in the private sector and leftist upbringing took him down the usual path of thinking that government can will the private sector to produce, while implementing policies that hinder investment and production.  That's why you saw an immediate mood shift in the private sector upon Trump's election, because despite all his faults, he knew well enough to get out of the way and restore business confidence.   Of course, Trump being Trump he can't leave a good thing alone, and continues to insert himself in the weeds of economic policy, which is as bad as his 4AM Tweets.

 

The Great Recession really wasn't an economic recession, but a crisis of confidence in the financial sector.  Despite the massive bank failures, the core business sectors were fine, and it should have been a quick recovery if the only focus was on stabilizing the financial sector.  So when you say that Obama inherited Bush's mess, that's overplaying it, since this was a global banking crisis, not a US economic problem.  But since the administration could not let a crisis go to waste, the recovery was saddled with multitudes of regulations and the Obama-care overhang that put the brakes on any speedy recovery.

 

But bringing the topic back to the current recession, there are a lot of reasons to be far more concerned now than in 2009.  This is a true economic recession, and I'm not looking at the 2Q or even 3Q numbers to see how the recovery will turn out  The bigger issue is how many businesses are going to come back at all, and what will corporate loans look like in early 2021.  I would dispute the notion that opening up the economy ASAP is not a panacea, because the longer this drags out, the more stress you re putting on smaller businesses to stay afloat.  At some point, the stimulus checks will run out, but there won't be as many jobs to come back to.

 

That's why the blue states are playing a very dangerous game of chicken.  By focusing only on defeating Trump, they are setting up an economic disaster, which the Federal government will be helpless to fix.  Cuomo is already seeing it in NY.  The moron NYC mayor doesn't see it and thinks that the departed wealthy can be easily replaced.  They won't be. It's amazing how he destroyed 30 years of progress in NY.  The same goes for the clueless Squad.   

[Golden Goat]

12 minutes ago, GG said:

The bigger issue is how many businesses are going to come back at all

Taking that a step further, many of the small businesses that do survive will reassess their staff, if they haven't already. I've spoken with many small business owners in the past four months who've said, "We're going to downsize. We never realized how much fat we had. We don't need all these employees. We didn't realize how much we could get done in India for a fraction of the cost. We don't need the overhead of a storefront." Etc.

[B-Man]

 

[GG]

7 minutes ago, Golden Goat said:

Taking that a step further, many of the small businesses that do survive will reassess their staff, if they haven't already. I've spoken with many small business owners in the past four months who've said, "We're going to downsize. We never realized how much fat we had. We don't need all these employees. We didn't realize how much we could get done in India for a fraction of the cost. We don't need the overhead of a storefront." Etc.

 

Don't forget commercial real estate.  How much footprint will the large employers require going forward.  All of these point to very scary forward indicators.

[Buffalo_Gal]

1 minute ago, B-Man said:

 

The Report...

10.2% unemployment (I want to see what happens now that the extra $600 incentive to stay home had expired) and added 1.8M jobs.

 

[BillStime]

 

[BillStime]

 

[Chef Jim]

1 hour ago, BillStime said:

 

Why has there been this record drop?  What has Trump done that caused this drop?   How would Biden have ensured it wasn’t this bad?  
 

And no memes. 

[BillStime]

39 minutes ago, Chef Jim said:

Why has there been this record drop?  What has Trump done that caused this drop?   How would Biden have ensured it wasn’t this bad?  
 

And no memes. 

Biden wouldn’t have destroyed our pandemic infrastructure and ignored his intelligence in November 2019.

[Azalin]

15 hours ago, GG said:

 

Don't forget commercial real estate.  How much footprint will the large employers require going forward.  All of these point to very scary forward indicators.

 

For what it's worth, we've installed many "covid" data circuits here in town lately - high priority, last-minute circuits designed for both business and state agencies to provide greater access for their employees to work from home. Some of these circuits have been temporary, falling out of service as people return to the office, but some are intended to be permanent. I work in the heart of downtown Austin, and the traffic in & out of the city is still nothing compared to what it used to be. A lot of employers around here are seeing how much of their leased space is unnecessary, and I'm sure they're reevaluating that for the long term. 

[Chef Jim]

8 hours ago, BillStime said:

Biden wouldn’t have destroyed our pandemic infrastructure and ignored his intelligence in November 2019.

And that would have not had the economy shut down to prevent the spread?  ?

[Bakin]

8 hours ago, BillStime said:

Biden wouldn’t have destroyed our pandemic infrastructure and ignored his intelligence in November 2019.

LOL. Biden didn’t even want to close the border to China in February. Because racism.

November 2019 intelligence?  Hahahahahaha. Wtf are you talking about?  Late December was when it was confirmed the virus was novel.

I assume you think China has done a terrific job here seeding the world with this disease. You probably place no blame on them, right?
 

Biden had no clue what was going on...and still doesn’t. Have you heard him speak?  Oh right...his handlers will barely let him. When he does - gaff machine. 
 

[SoCal Deek]

8 hours ago, BillStime said:

Biden wouldn’t have destroyed our pandemic infrastructure and ignored his intelligence in November 2019.

But apparently the Democratic leadership would have and did. Because while all this was going on they were conducting a mock show trial over a totally stupid phone call with the Ukraine! So shutting down the country had to wait until AFTER they completed their kangaroo court clown show. Unbelievable!

[Tiberius]

3 minutes ago, Bakin said:

LOL. Biden didn’t even want to close the border to China in February. Because racism.

November 2019 intelligence?  Hahahahahaha. Wtf are you talking about?  Late December was when it was confirmed the virus was novel.

I assume you think China has done a terrific job here seeding the world with this disease. You probably place no blame on them, right?
 

Biden had no clue what was going on...and still doesn’t. Have you heard him speak?  Oh right...his handlers will barely let him. When he does - gaff machine. 
 

No, Biden was warning Americans about this while Trump was saying it would disappear on its own. Trump is a disaster 

[BillStime]

1 hour ago, SoCal Deek said:

But apparently the Democratic leadership would have and did. Because while all this was going on they were conducting a mock show trial over a totally stupid phone call with the Ukraine! So shutting down the country had to wait until AFTER they completed their kangaroo court clown show. Unbelievable!

One has nothing to do w the other - nice try. Trump started destroying our pandemic infrastructure over 2.5 years ago.

 

Most pathetic rebuttal ever. 

1 hour ago, Bakin said:

LOL. Biden didn’t even want to close the border to China in February. Because racism.

November 2019 intelligence?  Hahahahahaha. Wtf are you talking about?  Late December was when it was confirmed the virus was novel.

I assume you think China has done a terrific job here seeding the world with this disease. You probably place no blame on them, right?
 

Biden had no clue what was going on...and still doesn’t. Have you heard him speak?  Oh right...his handlers will barely let him. When he does - gaff machine. 
 

Now do Trump 

[3rdnlng]

2 hours ago, BillStime said:

One has nothing to do w the other - nice try. Trump started destroying our pandemic infrastructure over 2.5 years ago.

 

Most pathetic rebuttal ever. 

Now do Trump 

Why do you continue to perpetuate these lies? There is not a scintilla of proof that the USA was aware of the virus back in November of 2019. In addition, Trump only eliminated a duplication of people that were hidden away in the NSA by Obama. We've gone over this numerous times in the past but you obviously are incapable of learning anything that doesn't match your preconceived opinions.