The Trump Economy

[B-Man]

 

[OldTimeAFLGuy]

3 minutes ago, B-Man said:

 

 

...SERIOUSLY?.....would you expect anything LESS from "Chuck The Putz"?......NYS has a treasure trove of putzes......Chuck, Spitzer, Silver, Schneiderman, Weiner, Nadler, etc....honorable mention to those I missed.....special thanks to Hillary the Carpetbagger.............

[ComradeKayAdams]

On 7/24/2020 at 9:24 PM, RochesterRob said:

  I guess that I would counter that the US economy was perhaps at its strongest for a few decades after WWII providing a potent taxable income base to repay debt.  Nearly all sectors were undergoing growth never seen in the history of the world.  Predatory lending was limited to the back alleys of the cities.  Today many millions could see financial devastation over a short time period if certain sectors of the economy stall out.  Rather odd that the conservative namely me is making pretty much a non-data connected argument but here I am.  I would prefer that we keep using capitalism even with its imperfections but we have a very motivated group of people trying to push it aside in a Presidential Election Year.  And yes the fallout from the pandemic might prove to be key if many businesses see AI as the hedge they need against future potential losses due to employees not being available for work.  I honestly think that the world is in greater flux than a lot of people tend to think.

 

Yes, the hallmark of a healthy economy is a large, strong middle class like what was seen during the few decades after WW2. These types of economies score well on economic happiness metrics and provide the government with the highest tax revenue needed to pay down big debts. So they represent the approximate end goals of domestic economic public policies.

 

Federal debt is nothing more than a malleable means to reach these more optimal end goals. There are no apparent target numbers like total debt-to-GDP ratios that we should strive for during different economic situations. As long as we increase national debt during economic downturns, then I’m happy. If we’re not doing some combo of cutting taxes or injecting economic stimulus during recessions, then we’re not trying hard enough to get out of them. Balanced budgets (last done under Bill Clinton in 2000) and zero national debt (last done under Andrew Jackson in 1835) can be goals between recessions, but they don’t appear to matter all that much in American macroeconomics. Seems counterintuitive, but that’s because we tend to incorrectly think of federal government debt as perfectly analogous to personal household debt.

 

It’s unclear how much automation will replace human labor after the pandemic, but I don’t think it will be too bad yet and this opinion has more to do with current technology limitations than anything else. The AI revolution is coming, so it’s never too early to start thinking about what our displaced work force can do instead: public works projects, taking up Hillary’s and Joe’s idea of learning to code, arts and crafts, creating online memes, space force cadets, etc… Old sectors of the economy have always been replaced by new technology all throughout capitalism’s history (horse-drawn carriages with cars, Blockbuster with Netflix, etc.), but never at the level of what AI would do. If the transition happens too quickly for the economy to accommodate, then we’ll need government to intervene.

 

On 7/24/2020 at 9:34 PM, 3rdnlng said:

You make a somewhat reasoned argument but the call to chop our defense budget is shortsighted. China has proven lately that they will do most anything to take over our leadership and make us their bitchh. Not only do we need to stay strong but we need to get stronger. It may be the only thing that keeps us out of war with China. 

 

But as you know, a nation’s strength isn’t solely dependent on the size of its military budget. It’s also a matter of HOW and WHERE the military budget is spent, global military force positioning/logistics, war strategy, battle tactics, training/command execution, foreign policy toward allies and enemies, economic strength, internal stability with regards to social and political unrest, and so on...

 

I’m not sure if our military leaders could ever delineate for the American taxpayers a military budget size threshold at which they’d feel confidently safe from Chinese aggression. There will always be an argument to be made for more. The latest proposed US military budget is $740 billion, but let’s use the 2018 numbers for the sake of international comparisons. The entire global defense budget was $1.8 trillion in 2018, with the US leading the way at $650 billion and China in second at $250 billion. This seems…excessive. For starters, I would personally propose cutting about 25% of that annual budget (note: this is much greater than the 10% that Senator Sanders meekly proposed this year and that was unanimously rejected), which would still have us outspending China by a 2-to-1 ratio. Budget cuts would then force our military leaders and politicians to streamline our post-Cold War military, focusing more on high-tech capabilities and less on soldier deployments, while discontinuing the subsidization of other countries’ defense programs.

 

I cannot imagine any realistic scenario where Chinese military aggression would ever play itself out on the world stage without them sustaining devastating multilateral military and economic damage. And I don’t see a physical invasion of our own country at all likely within the next two generations. Remember that our citizens have the second amendment! Modern warfare with the US will either be done purely economically, by cyber security intrusions, or with “accidental” biological weapon releases, but not with big metal machines and bombs and boots on the ground except in very desperately nihilistic scenarios. Some of these grand national defense spending proposals we hear about simply reek of Chinese fearmongering for the sole benefit of the military-industrial complex and the usual neocon suspects. I would argue that we could simultaneously increase our international strength while substantially reducing military costs by establishing a new “Swiss Doctrine” foreign policy ethos centered on strong border defense, non-interventionism (not the same as isolationism!), and last-resort multilateral military offensive engagements. I know I’m speaking a bit too generally, of course, because international relationships and military strategy and ethics are rarely this simplistic. But y’all get my idea, I hope?

 

And finally, I want to quickly note the non-military implications of a potential military budget escalation with China. Foolishly doing so would only replicate the Roman Empire’s classic mistakes, spreading financial investments and other vested interests out too far and wide while decaying internally from the outward diversion of resources. Why not use some of that money to invest in our own citizens and reduce social unrest? Education and health care are two big example investments for me, as you know. Reduced military expenditures would not kill domestic tech jobs, either, but would rather simply free up military company contractors for more socially beneficial ventures such as commercial space tech, commercial electronics, or any of my many fantastic Green New Deal public works project recommendations!

[ComradeKayAdams]

On 7/26/2020 at 1:54 PM, ALF said:

I won't believe that unless GG and Real Kay Adams agree with you.

 

https://www.macrotrends.net/countries/USA/united-states/gdp-growth-rate

 

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.

 

On 7/26/2020 at 5:01 PM, 3rdnlng said:

B-Man is correct. We came out of the recession in early 2009 but especially considering how deep the recession was we never had anything other than an anemic recovery, for 8 years. 8 promised "summers of recovery" that amounted to nothing more than typical Obama empty promises. 

 

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).

 

On 7/26/2020 at 7:04 PM, Koko78 said:

Yeah, but on the bright side, many of his buddies became rich under his porkulus bills, getting full funding for the 'shovel ready jobs' that didn't exist.

 

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!

 

On 7/28/2020 at 8:58 AM, Tiberius said:

The GOP stimulus plan cuts the money for the regular people and pumps up the deduction for three martini lunches. 

 

The useful idiots on the right worship their corporate masters 

 

https://thehill.com/policy/finance/509210-kudlow-gop-plan-will-include-increased-business-deductions-for-meals-and

 

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.

 

On 7/30/2020 at 9:10 AM, SoTier said:

 

I don't think that this was unexpected, and I expect that the third quarter, July through September, will likely to be as bad or even worse as areas with high coronavirus rates now struggle to contain community spread and Covid-19 spreads to new areas like the Upper South and Midwest.

 

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?

 

On 7/30/2020 at 9:47 AM, SoTier said:

 

I doubt it.  I think the GOP is a prisoner of its own ideology, much as Herbert Hoover was a prisoner of his own ideology back in 1932 which made it impossible for him to effectively respond to the 1929 stock market crash.

 

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??

 

On 7/31/2020 at 5:22 PM, GG said:

Sounds like you fully support opening up the economy to get us out of the recession.

 

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.

 

On 7/31/2020 at 7:51 PM, Buffalo_Gal said:

Why are they lying about the 32% drop? That would be a yearly rate (assuming Q2 numbers for 4 quarters which cannot happen in 2020 since Q1 was not a drop). It is not a Q2 number.

 

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.

[Tiberius]

8 minutes ago, RealKayAdams said:

 

 

 

 

 . 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…

 

 

 

 

 

 Seems like they did a lot to help small businesses and have been for years, both parties. Both parties here in US both support big corporations, and that';s ok. Corporations are the gooses laying golden eggs, so of course you protect them, with Dems wanting more restrictions on them. 

 

[3rdnlng]

@RealKayAdams

 

"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)."

 

I think you have discounted the way improvements tend to get harder to attain the closer one gets to the best scenario. Let's say that 100 is the goal. It's pretty easy to go from 0 to 50 and fairly easy to go from 50 to 75 and so on. When trying to go from 95 to 100 it is generally quite difficult. Trump was operating in the 95-100 range in the stock market, growth rate and unemployment rate. Comparing Obama's statistics to Trump's on a straight line basis is just wrong. Look at it this way: it's a lot easier for a new football coach to take a team that was 2-14 to an 8-8 record than it is for him to take a team that was 8-8 to a 14-2 record. 

Edited August 3, 2020 by 3rdnlng

[Buffalo_Gal]

5 hours ago, RealKayAdams said:

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.

Q1 forecast an annual decrease of 4.8%, Q2 an annual rate of 32.9%. These are not what happened in that particular quarter.  It gets very skewed because they are annualizing the rate based upon a quarterly rate (well, plus some compounding).  Now, is the Q2 number good? Hell no. But it is not -32.9%  in the quarter (as was tweeted) and we are unlikely to see that rate for a whole year (an annual).   California alone being fully open would help tremendously... which means it ain't gonna happen until November 4th.

 

[Buffalo_Gal]

Some positive news:
 

ISM Manufacturing Index (PMI) Beats Forecast in July, Continuing Expansion Cycle
 

The Institute for Supply Management (ISM) Manufacturing Index (PMI) came in stronger than expected at 54.2% in July, up from 52.6% in June. This reading indicates an overall expansion in the economy for the third straight month after one month of contraction due to disruptive efforts to mitigate the spread of coronavirus (COVID-19).
 

</snip>
 

The reading also indicates manufacturing sector growth continued for the second straight month after three prior months of COVID-19-related disruptions.
 

</snip>
 

Demand is growing as is evident by the strong gain in the New Orders Index at 61.5%. That represents an increase of 5.1 from the June reading of 56.4%. New orders are being supported by the New Export Orders Index re-entering expansion.
 

The ISM Manufacturing Index (PMI) has now exceeded pre-pandemic levels. It hasn’t been as high since April 2019. The rate of increase for the PMI is a level not seen since August 1980.
 

</snip>

 

[BillStime]

 

[3rdnlng]

2 hours ago, BillStime said:

 

Get help!

[3rdnlng]

If Jonathan Seagull gets a stimulus check how likely will it be for him to get a mail-in ballot sent to him?

 

[TBBills]

Just now, 3rdnlng said:

If Jonathan Seagull gets a stimulus check how likely will it be for him to get a mail-in ballot sent to him?

 

Those are shoes republicans buy.

[Deranged Rhino]

 

[B-Man]

5 hours ago, TBBills said:

Those are shoes republicans buy.

 

 

No.

 

Seagulls are obviously democrats.........

 

[Buffalo_Gal]

Initial jobless claims

Actual: 1,186K (1,186,000)
Forecast 1,415K (1,415,000)

 

[BillStime]

This thread is a joke - just like the Trump economy

 

 

[B-Man]

 

 

UNEMPLOYMENT AND CORONAVIRUS: Weekly Jobless Claims Fall to Pandemic Low.

 

 

 

 

 

 

 

[SoCal Deek]

1 hour ago, BillStime said:

This thread is a joke - just like the Trump economy

 

 

Let me see if I have this right....you DON'T like the President?

[IDBillzFan]

7 minutes ago, SoCal Deek said:

Let me see if I have this right....you DON'T like the President?

 

I think you can put BIllstime down as a "maybe" for his Trump vote.

[Tiberius]

On 8/3/2020 at 5:34 PM, BillStime said:

 

20 straight weeks of over a million new unemployed, sad.