The market has apparently taken a dim view of the Administration’s ability to manage the debt ceiling issue. From Deutsche Bank (not online):
Truth be told, I am unsurprised.
The market has apparently taken a dim view of the Administration’s ability to manage the debt ceiling issue. From Deutsche Bank (not online):
Truth be told, I am unsurprised.
Thanks Menzie for sharing this data from Deutsche Bank.
I could not recall Trump’s campaign views on the debt so I searched and found this:
“We’ve got to get rid of the $19 trillion in debt.” ….. “Well, I would say over a period of eight years. And I’ll tell you why.” ….. “I don’t think I’ll need to [increase taxes]. The power is trade. Our deals are so bad.”
From Bob Woodward’s WP interview, April 2016.
Then I discovered that Trump had suggested that Congress logroll the debt ceiling into the popular VA legislation. Now he has threatened to logroll aid to Hurricane Harvey victims to an increase in the debt ceiling.
This man child of a president never ceases to surprise with his incompetence. Now we have some evidence that his presidency is already acting as a drag on US economic growth.
For this president, market uncertainty and cheap threats are zero-cost, zero-blowback tools to an end which may work very well in a setting of competitive zero-sum capitalism but not so well when trying to lead the entire country.
No doubt Trump inherited a mess and it’s easy to ignore incompetence before Trump, but why would a guy call an alpha male man’s man a “man child” – something a mother might say.
Krugman once described Gingrich this way: “He’s a stupid man’s idea of what a smart person sounds like”.
Trump is an “alpha male man’s man” in the same way Gingrich is a smart person.
We know the liberal elite believes the American people are stupid. Some people, stupid or not, don’t understand Trump. And, they fear what they don’t understand.
PeakTrader: Is an alpha male man’s man a person who (1) makes crude remarks about women’s genitalia, (2) ridicules disabled people, (3) lies incessantly and without compunction, and (4) makes non-credible threats, and then backs down?
Menzie Chinn, that’s an exaggeration. Of course, Trump isn’t politically correct or behaves like the typical politician.
PeakTrader: Please indicate in which category (1), (2), (3) or (4) I have exaggerated.
Why is Trump a “man child”? Because “the Donald” has the maturity and self-control of an emotionally arrested middle school kid. Perhaps it was all those painkiller drugs he took back in the 80s following his scalp reduction surgery, as one of his ex-wives tells us.
http://www.huffingtonpost.com/entry/donald-trumps-hair-mystery-solved-he-had-scalp-reduction_us_58966965e4b061551b3dff8a
Unlike Obama, who actually did inherit a world class mess, IMPOTUS Trump did not. The economy was puttering along at a disappointing growth rate, but it could hardly be described as a mess. Growth was low but consistently positive. Inflation was below target, but dramatically so. Employment numbers were decent if not spectacular. My point is that you need to be more careful with your words. There is simply no comparison between Jan 2009 and Jan 2017. There’s a big difference between godawful and lackluster.
BTW, before last year’s election (in an exchange with Rick Stryker), I said that I thought the economy would likely tip into a recession around Sep/Oct 2017 regardless of who won the election. Trump’s mishandling of the NK situation, his fumbling on healthcare insurance, his incoherent tax cut plan (if you can call a few paragraphs a “plan”), his calls for tariffs, and his stupid decision to reverse DACA all make me more confident than ever that this economy is at a tipping point. Throw in a couple of natural disaster for which Trump is blameless, and you’ve got a recipe for a recession. And lately the markets seem to agree with me. Of course, it will take NBER several months to make the call once the economy actually does slip into recession, but I think we’re getting close. And other OECD economies are looking kind of shaky as well.
You don’t become a billionaire, raise a great family, and win a presidential election being an immature out of control “school kid.” And, some people also underestimate the mess Trump inherited, including the huge federal debt and weak economic growth.
And, I think, Trump knows he’s a narcissist, unlike some of our past presidents. All he has to do is look at his buildings 🙂
PeakTrader Trump “earned” his money the old fashioned way…he inherited it, conned the gullible and welched on his business deals. The finance department at Stanford estimated that based on generally accepted estimates of his net wealth, Trump is half as rich today as he would have been if he had simply dumped his inheritance in the S&P 500 index fund. But frankly, I seriously doubt that he actually is a billionaire. And that’s probably why he’s so terrified of investigators looking at this finances.
Forbes ranks Trump 156th richest person in the U.S.. There are only about 600 billionaires in the U.S.. The S&P 500 represents, and adds or subtracts, the most successful companies. Most companies fail or don’t become that big. It’s not easy to create a highly successful company and become a billionaire in the process.
One might argue he’s done particularly poorly given what NY real estate prices have done since 1970.
https://www.google.com/amp/s/ny.curbed.com/platform/amp/2015/6/2/9954250/tracking-new-york-rents-and-asking-prices-over-a-century
How do you end up in debt while investing in this market?
Inherited a mess? Hahahahaaaaaahaha. You are so far gone.
What a poor performance – only became the 156th richest person in the U.S..
One good thing Trump inherited was lots of GOP seats, won since 2010.
Don’t know where you’ve been.
The same guy who said he loves debt and who once floated the idea of redeeming treasuries at LESS than par, is the guy who can manage government FY deficits and the national debt? It is to laugh.
Yes, and he’s worth $3.7 billion more than you.
What a laugh.
Of course, when I was in my twenties, I never received a $1,000,000 gift from my father ($4.7 million in today’s dollars) , nor was I able to borrow $14,000,000 from him before going bankrupt in the casino business. (Hmm. Let’s see. $14,000,000 in 1985, averaging 8%/year over the past 32 years would be worth…….plenty today)
There were, of course, other loans Trump also received from dear old wealthy Dad that were impossibilities for commoners like me. Then too, I didn’t benefit from THREE trusts dear old wealthy Dad set up for family either.
Makes sense since my father died before I was a year old. Thus, he was unable to pay for me to attend a prep school or to fund my college years at an elite Ivy League university; No, it was public school , and I had to rely on myself to raise funds to attend a state university instead.
So, please, continue to cheer for this debt loving financial guru who started with everything and to sneer at those who began with relatively little while making snide, meaningless comparisons between the two.
actually peak, since trump is unwilling to disclose his financials, your really have no business claiming he is even a billionaire. shoot, there is limited evidence he is even a millionaire. you take his word that he is a billionaire. we have seen recently how good his word is.
It’s well known Trump is a billionaire. The question is how many billions. Where is your evidence he’s not even a millionaire? Let’s see how good your word is.
Forbes and Bloomberg estimated Trump’s net worth adding up the value of his assets and subtracting his liabilities.
What’s your calculation?
The Definitive Net Worth of Donald Trump:
https://www.forbes.com/donald-trump/#4ccfe7902899
PeakTrader Forbes estimates Trump’s worth at $3.7B. But there are lots of reasons to wonder about that figure. For one thing, we know that in 2005 his 1040 reported income was only $150M,which is a pretty poor before tax return on $3.7B in net worth. And 2005 was a fairly decent year in the NYC real estate market. We also know that on at least one occasion he lost almost a billion dollars in a single year. We also know that he earned about $15M per year with his 14 year Apprentice gig, which is about 10% of his reported before tax income for 2005. The 1990s were not kind to Trump with bankruptcies in several of his hotels, resorts, casinos and even Trump Airlines had to be sold off at fire sale prices. His companies filed for bankruptcy six times. Trump’s business strategy is to maximize risk and leverage, then keep the winnings if things go right and declare bankruptcy if things go south. That’s not my idea of a good businessman who adds wealth. That is a pretty good description of the Wells Fargo school of business management.
Trump basically shifted out of real business stuff and into selling his name, so it’s vitally important that he keep the rich, successful, wheeler-dealer image because that’s all he’s got. The emperor/president has no clothes.
Trump finished the New York skating rink early, under budget, and made the city a profit, after the city squandered millions of dollars, a lot of time, and couldn’t finish it.
And, Trump donated the money he made from the rink to charity.
“Once upon a time there was an ice skating rink in Central Park that could no longer make ice. No one could figure out how to fix the skating rink. Years went by and millions of dollars were spent and still no ice. One day a white knight wearing a bright red tie showed up and said: ‘ Let there be ice!’ Four months later there was ice. When asked by the press why the people had been unable to fix the rink themselves the knight said ‘they’re very nice people and I like them very much but they’re all idiots!’”
I bet that under a full accounting that Putin is a very rich person. So by some folks logic here – we should invite Putin to be our President.
As far as “No doubt Trump inherited a mess and it’s easy to ignore incompetence before Trump” – the mind boggles. Yes it was so incompetent of President Obama to reverse Bush43’s second recession. And the fact that the unemployment rate had fallen below 4.5% means Trump did inherit the worse mess ever. Seriously?
Seriously, how much federal debt did the prior Administration accumulate for an L-shaped recovery from a severe recession. Fortunately, TARP was paid back, trade deficits were smaller, and there was a fracking boom. Otherwise, the “recovery” would’ve been even worse.
More QEs anyone?
Trump is very limited what he can do with a huge federal debt. Fortunately, he reversed some regulations, along with some unconstitutional executive orders.
Trump had this to say about taxes yesterday:
“Competitive business tax rate. Ideally down to 15%. “You will see a rocket ship” (?!). Business owners would rather spend what they pay in taxes on their employees, dontcha know!”
Dontcha know? Apparently Trump doesn’t know. During the campaign Trump bragged that he knows more about taxes than anybody.
But Trump doesn’t know even the most basic facts about taxes. Money spent on employees is completely tax free already. Always has been. You want to reduce your taxes? Just give more money to your employees. You pay zero taxes.
Donald Trump is profoundly ignorant about even the most basic issues regarding business. In addition, he is suffering from dementia, which too many people pretend to ignore.
Trump knows that cutting taxes bigly will enable us to put a trillion into infrastructure repair, increase military spending by 10%, spends tens of billions helping victims of Harvey and Irma, prepare for war with N.Korea (and maybe Iran), send more troops to Afghanistan and the ME, build a 1000 mile wall that Mexico won’t pay for. And you say he doesn’t understand tax cuts!
The core problem here is not Trump, it’s something far worse. Long after he’s gone, the vast horde that thought he was at least worth a try (and for the most part STILL DO!) will be with us. Perhaps our Great Purpose is merely to serve as a warning to others.