TrumpOnomics: A Disaster in the Making

Discussion in 'Politics, Religion, Social Issues' started by vrDrew, Dec 1, 2016.

  1. vrDrew macrumors 65816

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    #1
    While Donald Trump is basking (really? basking?) in the glow of having apparently wrung a promise to keep a few factory jobs in Indiana, the rest of the economic plans his administration seem destined to throw us into yet another economic calamity.

    Let's start with the issue on everyone's minds: Taxes. Trump plans to slash tax rates on the wealthiest by significant amounts, while giving middle- and lower-income Americans pretty much nothing. He also plans on slashing US corporate tax rates to 15%.

    The sum total of all of this will be to increase the deficit by a staggering $5 to $8 trillion over the next ten years. If the US long-term financial outlook was questionable in the wake of the Great Recession - it's going to look downright scary by the time Trump and the Republicans are done with it.

    Trump's big lie is that corporations are over-taxed. And that by cutting rates they will magically bring all this money back to the US and use it to hire uneducated white people.

    No one ever has given me a plausible explanation for how this is supposed to work.

    US corporations are already sitting on more cash than they really know what to do with. And within interest rates at historic lows, they can always get more if they need it.

    Then there is the Infrastructure plan. Which apparently involves giving tax-credits to corporations to build toll roads. And which is going to do pretty much nothing to help the people of West Virginia and Oklahoma, which don't have a market for toll-roads.

    Wall Street has been frothing at the bit over these give-aways since the election. But I suspect sooner, rather than later, that they'll figure out that Trumplestiltskin isn't likely to spin his campaign promises into gold. Leaving us with a stagnating economy; a brewing three-front trade war; and a Government run by incompetent crooks and nutjobs. The Market is already seriously overdue for a correction. Count me amazed if we don't have a major melt-down by the end of 2017.

    The Trump Recession of 2018 is coming folks.
     
  2. ucfgrad93 macrumors P6

    ucfgrad93

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    #2
    Count me amazed, it has been a few days since your last anti-Trump screed.

    Since you are such a good prognosticator, can you tell me the numbers for Saturday's Power Ball?
     
  3. Populism, Dec 1, 2016
    Last edited: Dec 1, 2016

    Populism macrumors regular

    Populism

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    #3
    So you will, or you will not, short the market?
     
  4. NT1440 macrumors G4

    NT1440

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    #4
    Well, it is going to be a disaster, but I've been convinced that whoever the next president was going to be would have to deal with a meltdown larger than 07/08 because we didn't fix the ****ing problem last time and the exact same practices have been used since then.

    Hopefully Trump will be regarded as the next Hoover, ushering in the rule of the next FDR-like president.
     
  5. yaxomoxay macrumors 68000

    yaxomoxay

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    #5
    4 8 15 16 23 42
     
  6. Hawkeye16 macrumors regular

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    #6
    How much debt was added in the last 8 years?

    You really don't know anything about the economy if you think this is true. It may be true for a select few companies (like Apple) but the majority of companies aren't just sitting on excess capital with the ability to just get more if they need it.
     
  7. ucfgrad93 macrumors P6

    ucfgrad93

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    #7
    Great, now I'm going to get stranded on a tropical island with polar bears and a smoke monster.
     
  8. vrDrew thread starter macrumors 65816

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    #8
    [​IMG]

    There are few things more frustrating than trying to discuss economics with people who don't understand what this graph shows.

    Obama became President in 2009. That first-year deficit was the result of a) the raging recession that started before he took office and b) the budget that was passed and signed by his predecessor. That's where all that debt came from. Dealing with the worst recession in a generation.

    And Obama passed a $1 trillion stimulus program. Which, for better or worse, saved the economy at the worst depths of a recession. As the economy recovered, tax receipts increased and the deficit shrank. To what it is in 2016 and forecast for 2017.

    We aren't in a recession now. But Trump is planning on giving away $5 to $8 trillion to people and companies that don't need it. Five to eight times as much as the much-derided Stimulus. To the people who are absolutely the least in need of economic assistance. When we are not in a recession.
     
  9. rjohnstone, Dec 1, 2016
    Last edited: Dec 1, 2016

    rjohnstone macrumors 68040

    rjohnstone

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    #9
    Debt and deficits are two different measures.
    The national debt doubled under Obama.
    Budget deficits are simply a government spending more than it takes it.
    Bill Clinton had budget surpluses (on paper anyway) that were artificial.
    He gutted defense spending and increased taxes that resulted in the surplus. It was totally unsustainable in the longer term.
     
  10. NT1440 macrumors G4

    NT1440

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    #10
    Gutted defense spending? Lol.

    The national debt was dramatically increased by Obama, but it has to be made crystal clear that at least $1 trillion of that was money spent on the the wars actually showing up on the books instead of being hidden behind "emergency" spending measures. Bush NEVER accounted for the war that was supposed to cost "$10 billion, tops" according to Rumsfeld.

    It's kind of odd to blame the spending someone hid on the accountant that actually brought it to light, to use an analogy.
     
  11. Chew Toy McCoy macrumors regular

    Chew Toy McCoy

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    #11
    Maybe Trump will announce black people getting killed by cops creates job openings.
     
  12. LizKat macrumors 68040

    LizKat

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    #12
    Shorting Apple sounds good, I like to round up my massive holdings to 10 shares on the cheap.

    What I'm trying to figure out is how trade wars will affect shipping which is already overcapacity and merging or going bust yet again. So now right when everybody still in the biz decides to buy these overCape-sized behemoths, Trump sez oh i know let's just make everything here. Gulp!
     
  13. yaxomoxay macrumors 68000

    yaxomoxay

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    #13
    ... and Kate.
     
  14. Raid macrumors 68020

    Raid

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    #14
    Things are looking up then.

    As for the corporate tax cuts, it's really not going to help America's debt problem, and it really isn't the reason why companies are moving out of America. It's more about the price of the L in the Cobb–Douglas production function.
     
  15. Hawkeye16 macrumors regular

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    #15
    There are few things more frustrating than trying to discuss economics with people who don't understand financials and financial forecasting. The CBO does a horrible job of forecasting economic changes. They have been as much as 25% too high and 10% too low AFTER correcting for legislative changes on only a 1 year out projection. That chart you shared means absolutely nothing because you don't say anything about the projections.

    This is a table from the CBO in 2014 where the projection assumes no legislative change aside from what is current and what the president had proposed at that time. From what I see his policies are raising the debt about 7 trillion over the next 10 years according to this projection. The weird thing is that the public debt is much higher so unless they tell you what they are and are not including these charts and graphs don't mean jack.

    [​IMG]

    Here is another cute CBO chart with not much description other then the projection is assuming current legislation holds indefinitely. You see a very sharp increase in 2008 and a steady incline from there on out, including the projection. Since this is the most recent of the 3 posted I think it is fair to say the point you were trying to make is dead in the water.

    [​IMG]

    Also, the financial stimulus package that Obama put through did almost nothing to "save the economy". I don't know if you have noticed but we are still in a suppressed economy and the fed keeping the rates rock bottom is a good indication of them thinking the economy still needs a bit of help to recover. Rates finally saw an increase when Trump won the election. It was a planned increase before he won (as were all of the increases the previous 2 years that never happened) but that is just splitting hairs.

    On to an opinion (of something I am fairly familiar with), I believe just tossing out Obamacare will easily cover the "cost" of all of these tax breaks. And tax breaks on corporations do a lot more to help the economy than anything Obama did.
     
  16. tgara macrumors 6502a

    tgara

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    #16
    I don't think YOU understand what that graph shows.

    Careful! This is the same guy who predicted an easy Clinton win in the November election. His track record on pretty much everything ain't so good.
     
  17. yaxomoxay macrumors 68000

    yaxomoxay

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    #17

    Beautiful, beautiful post! (Fyi I couldn't see the chart at first).
    Just one note. you say "the financial stimulus package that Obama put through did almost nothing to "save the economy"", which from a purely financial point of view is true, however the psychological impact was quite big. Not that it changes your argument, but I think it's worth saying.
     
  18. aaronvan Suspended

    aaronvan

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    #18
    Unpatriotic and treasonous CEOs of "multinational" American corporations must realize that hiring Americans and staying in America is theoretically correct. If they don't realize this then reeducation is in order.

    Trump will learn 'em. He'll learn 'em good.
     
  19. Hawkeye16 macrumors regular

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    #19
    Yeah I forgot to insert the chart but edited it fairly quick :)

    Yeah the psychological impact was big, and it did help as a short term patch, but I do not think it had any longer term benefits. It would have been perfect if something was done to help longer term and the stimulus would have been a nice jump start.
     
  20. Huntn macrumors G5

    Huntn

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    #20
    I liked your post but hated the reality of it. Oh maybe we can hope that those with sounder minds in the GOP, you know the fiscally responsible party to rein in the BS fantasy plans of President Trust. Realistically, more than likely it will take a full fledged melt down before Americans get it, but then we'll be in for some serious heart ache. Just waiting to see the look on the faces of those who voted in Trump to bring back America's golden age. We'll see how far fantasy carries us when our bank accounts evaporate. :oops::rolleyes::mad:

    I think I'm going to realign my 401k in the conservative direction.
     
  21. NT1440 macrumors G4

    NT1440

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    #21
    I'm not being funny when I ask you this, do you honestly believe that the followers of Trump wouldn't just graft the economic downturn being discussed to Obama? They still insist that Obama caused the last recession (willfully ignoring he wasn't even in office).
     
  22. yaxomoxay macrumors 68000

    yaxomoxay

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    #22
    The table you published is astounding. Revenue is growing, and is growing pretty fast (probably due to slightly better economy + increasing population) yet expenditures (which does not include AP) are growing even faster. It's all about controlling expenses at this point.
     
  23. NT1440 macrumors G4

    NT1440

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    #23
    So...another $1 trillion for nukes then eh?

    Meanwhile, nearly half of America (the wealthiest country on the planet) is poor. Makes you think.
     
  24. Huntn macrumors G5

    Huntn

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    #24
    It boils down to living in fantasy or reality. At some point, in the face of disaster, you can either come to terms with reality or be done with it and drown. I'm sure a substantial portion of the Trumpets would say they are already drowning, but they've picked an incompetent person to lead them to the promised land so the end result will be a helping hand pushing them under to get it over with. :oops:
     
  25. rjohnstone macrumors 68040

    rjohnstone

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    #25
    Your use of "they" is a bit disingenuous.
    I don't know of any sane person who would blame the recession on Obama.
    It was tanking before he was even sworn in. The impacts were still unfolding his first year in office, but they weren't caused by anything he did.

    I would blame the current near flat GDP growth on Obama, but even that is forecast to perk up this quarter.
    The recession is on Bush.
     

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