Author Topic: Trump economy  (Read 1788 times)

Offline surfivor

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Trump economy
« on: August 27, 2018, 07:39:24 PM »

It’s hard not to feel like the Trump economy does not have some strengths. Obviously there is still high amounts of homelessness on the west coast and in certain areas but I guess it was obama who said GDP past 3% was not possible but why was he so pessimistic ? Under trump so far the job market in many area seems to have some considerable strengths and the dollar has some strengths too were precious metal prices are low so why not just admit those things?

https://www.streetinsider.com/dr/news.php?id=14546182

Atlanta Fed Raises GDP Forecast to 4.6%


Offline David in MN

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Re: Trump economy
« Reply #1 on: August 28, 2018, 07:11:17 AM »
It's very hard to aggregate economic data. It's even harder to assign it to one person or action. And data is often cherrypicked to tell one story or another. Be very careful what you get sucked into with economic news.

Also, an important rule from a guy who lives in the stock market: never trust the Atlanta Fed. Never. They always revise down. I have no idea how they come up with their forecasts.

I see a different world. Debt is out of control, savings is near zero, and the worldwide government defecits are blowing up. Entire industries look scary. College, medicine, and autos (Americans with no savings need a $73,000 base level Navigator) look very risky. And if I were to be brutally honest we are in a classic Austrian interest rate bubble. And if all that looks bad the bond market looks worse.

All that to say I could just as easily be wrong. Like the Fed.

Offline Morning Sunshine

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Re: Trump economy
« Reply #2 on: August 28, 2018, 07:45:34 AM »
I see a different world. Debt is out of control, savings is near zero, and the worldwide government defecits are blowing up. Entire industries look scary. College, medicine, and autos (Americans with no savings need a $73,000 base level Navigator) look very risky. And if I were to be brutally honest we are in a classic Austrian interest rate bubble. And if all that looks bad the bond market looks worse.

Dave, what is a "classic Austrian interest rate bubble"?

Offline David in MN

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Re: Trump economy
« Reply #3 on: August 28, 2018, 02:48:37 PM »
Dave, what is a "classic Austrian interest rate bubble"?

Basically fans of Austrian Economics (Mises Hayek, etc.) believe that low interest rates are a disaster. It encourages people not to save because banks offer low rates and take on excessive debt because the low interest makes the cost of money easy.

If it helps, think of an extreme example. Suppose interest rates were 0 and you were buying a house. You'd want the biggest house because no matter how big or long the loan repayment everything you paid would be equity. With all this free money assets get bid up (sounds like 2008). If you think even further, the negative interest rates some countries have right now is an incentive to borrow money to live now because you pay back less later.

There's even a phenomenon whereby construction of "the world's tallest building" predicts an economic downturn.

https://en.wikipedia.org/wiki/Skyscraper_Index

Low interest rates simultaneously allow the bidding up of apartment prices and allow builders to overleverage themselves with debt. To one who believes in the Austrian School (like me) this is clearly resulted from too much free money.

Offline surfivor

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Re: Trump economy
« Reply #4 on: August 29, 2018, 12:06:24 PM »
There are various negative factors but what about GDP or job stats ?

Not saying other factors don’t matter but this chart does seem to correlate to a fair degree my impression of economic strength during various presidents

« Last Edit: August 29, 2018, 12:36:20 PM by surfivor »

Offline surfivor

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Re: Trump economy
« Reply #5 on: August 29, 2018, 12:44:06 PM »

If you google “us gdp growth” and filter it for the last month you see tons of articles saying 4.1% or around that

Offline surfivor

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Re: Trump economy
« Reply #6 on: August 29, 2018, 01:29:06 PM »
 I work in IT which is a very volatile job market. I have worked for 15 different companies. My sense of economic strength is probably more depending on how easy I think I will be able to get a good job with decent pay and benefits in the next year more than anything else. I actually don’t care so much if I get laid off or my contract ends as long as I feel other good jobs are out there . That is how I look at the economy, I don’t care at all how much a tv at wall mart may cost. I do have a sense of banker or Wall Street corruption however which also bothers me a lot

The IT job market goes up and down. It did seem like it had a serious bottoming out during Obama though it started to recover a bit later. It did seem to get worse than I had ever seen previously however for a good while
« Last Edit: August 29, 2018, 01:54:54 PM by surfivor »

Offline David in MN

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Re: Trump economy
« Reply #7 on: August 29, 2018, 02:55:14 PM »
If you google “us gdp growth” and filter it for the last month you see tons of articles saying 4.1% or around that

I agree that is how it was reported. All I'm saying is that I find such a number near useless because because it's always revised either up or down and the calculation of it is a little suspect. Timing, in addition, seems to play a massive role. As I look at that chart all I can think is that if I'm elected president my numbers will look great if I'm handed a recession whose end I can claim credit for. That's not to say that a pro-business president doesn't help or an anti-business one hurt but to aggregate all the way to compare quarterly GDP growth seems wrong.

Let me put another neat caveat in here. Military spending is in GDP. Starting a war ups GDP. Remember that. The economists of the world believe producing products that blow up makes us richer. I don't know how a cruise missile enriches me but that's how it's counted. This is why China builds empty cities (yes they do). The construction of an unused building adds to GDP. They're using the errors in the calculation to make themselves look more wealthy than they are. If they were really smart they'd build an airforce, flyplanes in circles for hours (wasteed fuel counts in GDP), and use very expensive bombs to destroy the empty cities. When to president decides to add to the strategic oil reserve, you guessed it, bump to GDP. We should, according to economists, test nuclear weapons daily. Hourly even better. So do give GDP a little less credit.

I work in IT which is a very volatile job market. I have worked for 15 different companies. My sense of economic strength is probably more depending on how easy I think I will be able to get a good job with decent pay and benefits in the next year more than anything else. I actually don’t care so much if I get laid off or my contract ends as long as I feel other good jobs are out there . That is how I look at the economy, I don’t care at all how much a tv at wall mart may cost. I do have a sense of banker or Wall Street corruption however which also bothers me a lot

The IT job market goes up and down. It did seem like it had a serious bottoming out during Obama though it started to recover a bit later. It did seem to get worse than I had ever seen previously however for a good while

Could be. A lot of odd metrics tell much about the economy. We've known for a while that in a boom period ladies buy shorter skirts. Doesn't seem like it should be related but it is. I'm sure some researcher has studied workforce liquidity and I bet it would be a fun read.

I'm not as concerned about the normal ups and downs. We all live through them from one degree to another. But the bubbles seem to be increasing in scope an predictability. That really scares me. And you could be in an awesome bull market right up until you aren't.

Offline CarbideAndIron

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Re: Trump economy
« Reply #8 on: August 30, 2018, 05:13:24 AM »
I can definitely see things getting real bad in the future, since now we have had 3 bouts of QE to hit us with this next downturn. But for now, this smoke screen sure does seem decent. At least from a jobs perspective. I don't know anyone unemployed.

Sure, every bit of common sense in me sees this insane amounts of debt, and everyone living just like they did back in '07 (people have REAL bad memory apparently), and I am scared. But at the same time, I do wonder how long they can string this along before it pops. I mean look at Japan, they have been going insane with the QE since like 2000 or so. They are doing okay (measured by GDP, which Dave explained is not a good measure). Perhaps we'll see them crash first as an omen?

I suppose I am just hopeful that my family taking advantage of this "good" economy, and being able to prepare for bad times, will continue for a bit longer. Though just an observation, even though things are supposedly good, there is still a lot of empty commercial real estate around up here in western WA. If they don't start using that to fill the shortage of industrial space, I don't see how that over-built market can survive much longer.
« Last Edit: August 30, 2018, 05:26:14 AM by CarbideAndIron »

Offline surfivor

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Re: Trump economy
« Reply #9 on: August 30, 2018, 06:00:53 PM »
The 2008 crash was peculiar in that it happened when one president was leaving and  another was coming into office. Every one also seemed to know it was going to happen when it did

Offline David in MN

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Re: Trump economy
« Reply #10 on: August 30, 2018, 06:49:41 PM »
The 2008 crash was peculiar in that it happened when one president was leaving and  another was coming into office. Every one also seemed to know it was going to happen when it did

Dot com blew up in 2000...

Offline surfivor

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Re: Trump economy
« Reply #11 on: August 31, 2018, 07:01:32 AM »
 This article claims the 2008 crash was significantly worse than the .com bubble. That is also my impression
http://jaredbernsteinblog.com/why-was-the-housing-bubble-so-much-more-damaging-than-the-dot-com-bubble/

 In general, the 1990's seemed like a good economy. What I disliked about Clinton was his banking deregulation and NAFTA. I don't understand why libertarians don't favor banking regulations like Glass Stiegel, but that is one reason I am not a libertarian.

I feel for me the ability to earn money provided it's a good job is more important than incentives for other people to save money. If I want to save money then I will do that despite incentives. Even with moderate inflation it's still a good bet I will save money as long as it's not hyper inflation, but hyper inflation has happened in other parts of the world and not the US. If times are tough I can always adjust my lifestyle, my spending habits, or were I live. If however I can't find a decent job and that situation remains for a couple of years, to me that is the worst case scenario as long as I am young enough to work.  Some of this is also how economic forces work and it’s hard to change it

 I was listening to Peter Schiff, he is very pessimistic and thinks the economy will crash and Trump won't be re elected. It would be easy to see every bull market as a bubble and the way he talks it sounds like he does. He mentioned the bubble of the 1990's without really trying to explain all of it's causes.  I also seem to be aware now that I think of it that most libertarian economists types never talk about GDP but they don't try to explain why they don't. When it comes to the economy and banks, I think there is a lot of conspiracy stuff happening but it's harder to address that than other economic factors

Besides the dot com bubble, Bush came into office in 2000. Every time there was a Bush in office there seemed to be some major war going on, when we had the first was Gulf War I under the older Bush, I never remember any other time of watching all the tanks on TV.
« Last Edit: August 31, 2018, 07:11:01 AM by surfivor »

Offline surfivor

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Re: Trump economy
« Reply #12 on: August 31, 2018, 08:17:22 AM »
The other thing about the 2008 crash is how Obama responded to it by bailing out the banks who helped caused it which I thought was horrible. The claim was that would help them loan money but they didn’t of course. That seemed to be his main policy and I hated it.  That was one of the many reasons I no longer supported him. He was a known and predictable entity since that but how Trump would respond to something like that to me is uncertain.

So GDP may be imperfect but does it represent anything meaningful? I have not seen why it doesn’t

There may also be some relativism, compared to today the 1990s seemed good economically but compared to the 1970’s the 1990s may have had many negative economic factors. I don’t see how realistically it is that easy to turn it all the way back. If there are any improvements they may be relatively slow to happen
« Last Edit: August 31, 2018, 08:31:16 AM by surfivor »

Offline David in MN

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Re: Trump economy
« Reply #13 on: August 31, 2018, 10:15:10 AM »
I'll try one more concrete example... The best way to add to GDP to the United States right now would be to build a bridge to Hawaii. It would be a massive undertaking and require quadrillions. Our GDP would go up 10 fold. Now, nobody would use the bridge. But that's how GDP works. We made something and money changed hands so we're all richer.

Schiff? He talks about GDP every other minute. It's second only to gold (every 3 seconds).

Offline surfivor

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Re: Trump economy
« Reply #14 on: August 31, 2018, 11:43:10 AM »
I'll try one more concrete example... The best way to add to GDP to the United States right now would be to build a bridge to Hawaii. It would be a massive undertaking and require quadrillions. Our GDP would go up 10 fold. Now, nobody would use the bridge. But that's how GDP works. We made something and money changed hands so we're all richer.

Schiff? He talks about GDP every other minute. It's second only to gold (every 3 seconds).

When you look at it like that it is very abstract because who decides what is useful ?

A yogi may say everything is made of energy so you must apply your energy in a productive way. However, I am a computer programmer. I really have no need to program computers for myself but rather I depend on other people who need software systems or complex websites and I find it interesting enough work for the most part with various challenges but through challenges you grow and learn stuff.

A carpenter knows how to build houses but he may not need to build houses for himself but needs someone to hire him. He may think that the house he is building is too big and impractical, but just builds according to the plans provided.

It reminds me also, a house may seem to fancy and impractical or a car too expensive and fancy but if women find such things appealing then men will seek to acquire them

Society, governments, and political forces fight it out to decide what is important and we may disagree but there are also side effects. Military or space projects may also create technological advancements

No matter what a person does he has to do something to be productive and earn a wage. I see people out there cutting lawns that do not seem to need cutting or other landscape work that does nothing for me but someone is paying then. It is like King Solomon said in the Bible how everything is madness and chasing after the wind (ecclesiasties)
« Last Edit: August 31, 2018, 11:48:42 AM by surfivor »

Offline surfivor

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Re: Trump economy
« Reply #15 on: October 02, 2018, 02:11:09 AM »
Spirko on the latest podcast said the economy has been improving with Trump. He mentioned several positive points on the economy. He also said he didn’t like Trump but he didn’t elaborate at all as to why and he didn’t say anything negative about Trump. Jack mentioned he avoids politics mostly and seemed to imply non of it really matters although one might think perhaps the economy does matter to some extent. To me it does.

Jack portrayed the trump economy as having fairly modest improvements but seemed to predict it was going to continue to improve and likely improve significantly in the next few years
« Last Edit: October 02, 2018, 02:16:20 AM by surfivor »

Offline Chemsoldier

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Re: Trump economy
« Reply #16 on: October 02, 2018, 06:24:00 AM »
I dont trust the opinions of survivalists (even myself) when it comes to the economy.  I frankly dont understand why this economy didnt fall apart years ago and wanted Hillary to win (I didnt vote for her) just so the dems would be in charge when it all came apart.

I am very concerned about the debt the latest budget is going to generate, i am a bit of an extremist on budgetary responsibility. I like lower taxes, but if Congress and the people cannot get their act together to reduce the size and scope of the government than i think we should raise taxes to close the gap as we can. At least people feel some pain signal for spending increases.

Offline David in MN

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Re: Trump economy
« Reply #17 on: October 02, 2018, 03:13:17 PM »
I dont trust the opinions of survivalists (even myself) when it comes to the economy.  I frankly dont understand why this economy didnt fall apart years ago and wanted Hillary to win (I didnt vote for her) just so the dems would be in charge when it all came apart.

I am very concerned about the debt the latest budget is going to generate, i am a bit of an extremist on budgetary responsibility. I like lower taxes, but if Congress and the people cannot get their act together to reduce the size and scope of the government than i think we should raise taxes to close the gap as we can. At least people feel some pain signal for spending increases.

Couple things... Yes, most of the prepping ilk lack much economic grounding. Some have a shelf full of econ books and some may have even taken macro/micro classes. But most (especially the ones I know in real life) are apt to spin a yarn about a dollar collapse but couldn't explain a Keyensian from a monetarist.

That said, I would lay a lot of this at the hands of the media and academia. A lot is data analysis and a data analyst can really spin the data and select what gets used. Based on his writing (which frequently contradicts itself) I can't believe Paul Krugman is the strongest voice in the land. I feel that he's not really informing readers. But on the other side would I feel informed with only Zerohedge and Peter Schiff? It's even well known in the industry which schools are liberal, conservative, and which one is libertarian (George Mason). So the entire discipline knows exactly what you will think based onn where you studied. And these are just the capitalists. I'm ignoring the 5 or so flavors of Socialism.

What I'm hamhandedly getting to is that within the discipline you will know the camp you're dealing with. But I'd be suspect of numbers from any of them.

If you want more I have for years listened to Econtalk. Very dry but very informational without much politics. It's a good commute listen.

Offline surfivor

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Re: Trump economy
« Reply #18 on: October 02, 2018, 07:18:25 PM »


I have read some economic books and listened to various analysts, news shows etc. The different views are political based and almost a bit religious like or even similar to astrology trying to predict the future. It doesn’t seem as though there is any one authority to follow. I disagree with some of the ideas heavily promoted and also try to look at how banks, Wall Street, and the federal reserve operate and how economics was viewed historically going back 100 years or even to the founding fathers or other presidents. Globalism for instance was never promoted historically and libertarian stuff is new also. Any age of economic prosperity of the past does not include libertarianism as we know it and not globalism either. Those are new ideas and things have been going downhill since their inception for whatever reason.