Hi Mom,
Still catching up.
This stuff is from earlier this year, but it's still very relevant.
From - http://marketshadows.com/2018/02/13/takeaway-tuesday-trump-takes-1-7tn-poor-give-rich/
Takeaway Tuesday – Trump Takes $1.7Tn from the Poor to Give to the Rich
Courtesy of Phil of Phil’s Stock World
The new budget is here!
As not at all promised by Trump when he was campaigning, Medicare will be slashed by $237Bn while $17Bn is being taken away from Food Stamps and yes, the Government will be getting in between you and your grocer as Trump is proposing no longer giving people food stamps, instead sending them boxes of food the Government selects for them (from campaign donors, of course).
(Via Washington Post)
Trump’s budget is an outright assault on small businesses and farmers with a 25% cut to the SBA and a 15% cut to Agriculture with limited eligibility for crop insurance and caps on subsidies which will destroy those family farms, forcing them to sell out to big Corporations, who are still able to game the system to their advantage.
Rural Economic Development Loans and Grants are being entirely eliminated – yet another way of making sure no one can compete with Trump’s Corporate Donors, who will also benefit from the 25% budget cut to the EPA. Overall, there’s a 42.3% cut to all Non-Defense Discretionary spending. In other words, Trump is cutting about half the stuff the Government does to actually help Americans while giving ALL of that money to the Top 10% – and mostly the Top 1%, of course.
Despite coming off the most expensive disasters in history and with climate change getting worse, not better, 22% of the Army Corps of Engineers is being cut, which is a shame because, just this morning, new satellite data shows sea levels rising much faster than previously thought and the Army Corps of Engineers does things like building dams and levees to protect our cities from such things.
But guess what happens when a city is flooded? SALES!!! Paint, hardware, carpets, furniture, Government clean-up contracts worth Billions of Dollars to Trump’s donors. Isn’t that better than spending Millions to prevent the disaster from happening in the first place?
And, just in case you thought Trump can’t possibly be purposely trying to destroy the environment to enrich his Donors – now they want to repeal Obama’s restrictions on how much methane is released into the atmosphere by Corporate Donors who drill for oil and gas on Federal Land. Methane, which is about 25 times more potent at trapping heat than carbon dioxide, accounts for 9 percent of all domestic greenhouse gas emissions. The rule requires companies to capture the gas in order to be allowed to drill but now they can just shoot it off into the atmosphere. Imagine what you would think if China were doing something like this? (Read my interview about climate change here.)
Trump’s budget is now projected to add $7Tn to our $20Tn deficit during Trump’s 2 planned terms and the White House is saying that’s OK, because Congress just approved a higher debt ceiling. That’s with the $1.8Tn cut to Medicaid, Medicare and Food Stamps, which you would think would be hard to pass in an election year.
So, we’re running up debt by $7Tn and taking money away from people who actually spend it in the economy and putting it into the hands of people who have so much money they don’t know what to do with it so they drive up the cost of assets by investing in them while seeking to extract higher and higher rents from the poor people who can’t afford things like cars or homes or educations – but need them to live. What a great scam, right?
Of course such irresponsible nonsense (and, for real nonsense, the BBC is calling Trump’s Infrastructure Package a “scam”) is hurting the Dollar and we’re down 0.5% this morning, back to 89.50 and that’s helped reverse the earlier pullback in the Futures, which were down over 200 points on the Dow but none of that matters if we are failing our bounce lines (see yesterday’s post) and, of course, rates are going up and, once again, we are forced to confront the math of deficits.
The US is now $20Tn in debt and we currently spend $440Bn a year (10% of our budget) on the interest on the debt we borrowed at an average rate of 2.2%, which is about 1.25% higher than the Fed Funds Rate. The Fed, whether they want to or they are forced to, is raising rates to 3.5% over the next two years so call that 4% interest on what will then be $23Tn in debt. That would then cost us $1Tn a year JUST TO SERVICE THE DEBT. That’s not even accounted for in the budget yet it’s $560Bn a year more than we spend now!
And what happens to us if interest rates rise to 6% over the next 6 years while the debt level hits $30Tn? That would drive the interest payments on our National Debt to $1.8Tn a year – almost half our current budget and, of course, we would either have to enter levels of Greece-like austerity (and there’s already nothing left to cut but the military) or, gasp, raise taxes to pay for it.
As noted by Peter Martin, Trump’s tax cuts will hurt in a more fundamental way. Cutting tax is a great way to boost the economy. If the unemployment rate was 10%, it would really help. It would lift the economy without stoking inflation. But when the jobs market is on fire and the unemployment rate is below 4%, it will add gasoline and make inflations’ flames fly higher, which also puts more upwards pressure on rates (the rent the Top 1% charge the Bottom 99% to use their money).
So the Rich are going to get much, much richer while the bottom 99% will go deeper and deeper into debt to pay for it. One of the only actually democratic things the GOP still believes in is that the National Debt should be equally distributed among all Americans, no matter how rich or poor they are so the $170,337 owed by you is the very same $170,337 owed by Donald Trump to finance all these tax cuts and pay-offs to Campaign Donors.
In fact, Wells Fargo just warned us that “Debt may be filling the gap for many households when incomes have not kept pace with rising living expenses. A reversal may be ahead if income growth does not catch up to consumer expectations.” Lower income consumers have been showing signs of weakness, because their income has been growing slower than wealthier Americans’. The pockets of weakness may explain why some asset-backed securities are performing worse even as the unemployment rate dropped in January and consumer confidence and income growth expectations are strong.
In other words, Americans believe all the BS the Administration has been spouting and they’ve stopped saving and started spending in anticipation of “unbelievable” tax cuts and trickle-down bonuses paid by their grateful Corporate Masters as they bring back the money they stashed overseas to avoid paying taxes for years (which would have boosted Obama’s budgets) without any penalty whatsoever.
Do you really think this is going to end well?
from - http://marketshadows.com/2018/01/23/tariffic-tuesday-trump-declares-trade-war-davos/
Tariffic Tuesday – Trump Declares Trade War in Davos
Courtesy of Phil of Phil’s Stock World
“As we learned after President Herbert Hoover signed the Smoot-Hawley tariff at the outset of the Great Depression, vibrant international trade is a key component to economic recovery; hindering trade is a recipe for disaster” – Asa Hutchinson
This is how we’re making America great?
Back in the 1930s, the Smoot/Hawley Tariff Act was supposed to “Make America Work Again” after the stock market crash of 1929 but, instead, it destroyed trade so effectively that, by 1932, American exports to Europe were 1/3 of what they had been in 1929 and World Trade collapsed – leading to job losses in every country, a 10-year Depression, the rise of Fascism and, of course, WWII.
On his way to Davos, Trump declared tariffs on imports of Chinese solar panels and South Korean washing machines. Measures his administration said were needed to protect U.S. manufacturers from a flood of cheap imports. South Korea’s Trade Ministry called the tariffs unfair and argued they violated World Trade Organization requirements, while China’s commerce ministry called the action an “abuse of trade remedies.” The U.S. action will also mean higher prices for American consumers and, already, companies like Kimberly-Clark (KMB) are cutting 5,000 jobs, citing sluggish sales.
Solar-industry leaders said tariffs will slow growth in solar-panel installations and the jobs they create, which are more plentiful than in solar-cell manufacturing, a relatively small industry in the U.S.
The most immediate impact of Trump opening the door to tariffs may be spurring retaliation by trade partners, as well as inviting more U.S. companies to seek help, said Chad P. Bown, of the Peterson Institute. That, in turn, could trigger additional trade skirmishes and fallout for U.S. workers and consumers, saying: “This is now really starting to escalate. The concern is that now we’re at a tipping point.”
Of course, driving the cost of solar panels up 30% is good for the coal industry, as it makes cheap, clean, renewable energy more expensive but there are 10x more jobs in renewables than there are in coal so this whole thing is idiotic AND very unnecessary, as the main purpose of tariffs is to create jobs and we’re already at record-low unemployment, so all this will do is drive up labor costs and spur inflation.
Meanwhile, while our President is starting a trade war, China’s President is taking on the mantle as the champion of free trade and is fully engaged in the Trans Pacific Trade Partnership (with every country but US) and, with Europe, is constructing the new Silk Road with the slogan “One Belt, One Road” which envisions constructing networks of ports, railways, pipelines and industrial parks between China and Europe. China is investing $50Bn in this project and more of that money will now go towards ties with Russian companies as Trump takes the US out of the partnership picture.
“We should foster a new type of international relations featuring win-win cooperation, we should forge partnerships of dialogue with no confrontation and of friendship rather than alliance,” said Mr. Xi in a nationally televised speech. He called for each country to respect each other’s sovereignty, “social systems and each other’s core interests.”
In his speech, Mr. Xi said China would set up 50 joint science and technology laboratories and offer 5,000 foreign scientists, engineers and managers research trips and training. “Even if you don’t agree with China’s vision, at least they have one,” said Sudheendra Kulkarni, chairman of the Observer Research Foundation. Now that the U.S. is absorbed with domestic politics, he said, China is “the world’s only remaining thought leader.”
America has never faced off in a trade skirmish with an opponent like China in terms of economic size, industrial capabilities and global ambitions. If it escalated far enough, a trade war could take down the entire global trading architecture. That may, indeed, be Trump’s goal. His longstanding view is that one of the biggest mistakes the U.S. ever made was to usher China into the World Trade Organization in 2001, enabling a competitor. Aides say he regularly threatens to pull out of the rules-setting body.
Tariffs and trade wars have never worked and Trump vastly underestimates the Global Economic power China now commands. This can all turn very ugly, very fast and – if we weren’t hitting the top of the market before – I’d say we’re forcing one now though these are slow-moving effects and it may take about 6 months to be able to look back at this moment and say “Yep, that’s where things really went to Hell.”
Meanwhile, be careful out there!
Originally published at Phil’s Stock World: Tariffic Tuesday – Trump Declares Trade War in Davos
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Reflect and connect.
Have someone give you a kiss, and tell you that I love you, Mom.
I miss you so very much, Mom.
Talk to you tomorrow, Mom.
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- Days ago = 1085 days ago
- Bloggery committed by chris tower - 1806.23 - 10:10
NEW (written 1708.27) NOTE on time: I am now in the same time zone as Google! So, when I post at 10:10 a.m. PDT to coincide with the time of your death, Mom, I am now actually posting late, so it's really 1:10 p.m. EDT. But I will continue to use the time stamp of 10:10 a.m. to remember the time of your death, Mom. I know this only matters to me, and to you, Mom.
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