Tuesday, January 31, 2017

Forecasting the Trump Economy

Over at the Zero Hedge blog, Tyler Durden quotes a comment that was added to the Texas Outlook Manufacturing Survey, a report issued by the Dallas Fed..

Durden says that these 42 words summarize what will happen in the next 6 to 12 months. Thus, we should take them seriously:

President Trump looks to do things that will be favorable for business, which would improve employment and growth if successful. However, protesters are all over the place, so I tend to think that will cause trouble for the country and for business.

There you have it. But, what do you really have? You have an interesting sidelight on the current political circus.

On the one hand the Republicans are in charge of everything. Once they get the next Supreme Court justice confirmed they will control the three branches of the federal government. They control most of the state governments too.

This comports a risk. When you are in charge of everything, you become responsible for whatever comes to pass. If the world comes to an end, if the economy falls apart, if terrorists attack the homeland… there is no one else to blame. If bad things happen, Trump and his Republican colleagues will be hung out to dry.

And yet, if ISIS is defeated, if Mexico pays for the wall, if the economy comes roaring back, if employment opportunities miraculously appear… Trump will look like a conquering hero. The Democratic Party will be become even more irrelevant than it is today..

Thus, Democrats have a vested interest in Trump’s failure. But, they do not want to have their own fingerprints on the failure.

If protests disrupt business and the economy; if Senate Democrats make it more difficult for Trump to govern… they will put themselves in the line of fire. The Trump administration will blame the Democrats for tanking the economy and for compromising national security.

It’s a gamble. It shows us that a violent overflow of powerful emotion often boomerangs. Expressions of extreme emotion are generally ill-advised—mostly because they make you look angrily histrionic, not consequential. They make you look as though you are off on your own anger trip and have nothing substantive to offer. They also make you look like you are willing to deconstruct the nation in order to make enhance your own political standing.


Trigger Warning said...

"[The Fed's] SEP [Summary of Economic Projections] forecast (1) did not anticipate the Great Recession that started in December 2007, (2) underestimated the severity of the downturn once it began, and (3) consistently over-predicted the speed of the recovery that started in June 2009..."
--- TheStreet, 3/16

The Summer of Recovery.

In fact, the same article shows that Fed "guru" projections (e.g., Bernanke) were, in some cases, negatively correlated with outcomes.

So I give Fed projections all the consideration they've earned.

Having said that, it's an interesting perspective.

Anonymous said...

@#HowyougotFDR -- It's happened before. Republicans were in complete control in the 1920's, all the way up to the 1929 crash and into the deepest part of the Great Depression. And the rest, as the historians say, is history

Sam L. said...

TW, that was eight years of the Annual Tour of The Summer Of Recovery. Did they come to a venue near you? Didn't for me.

Trigger Warning said...

Sam, it's like the decrepit remnants of the Rolling Stones. Always on tour, never where I live.

Anonymous said...

I read an interesting article on Color Revolutions and it certainly threw a spotlight into the darkness for me. The final paragraph (from here: http://orientalreview.org/wp-content/uploads/2014/01/Color-Revolution-Template-Briefing-Note-by-Andrew-Korybko.pdf) sums things up....

"A Color Revolution is initiated only after a controversial (or framed to be so) ‘Event’. It is the ‘coming out’ moment for the Movement, and Events are selectively exploited or manufactured/provoked. It all depends on the situation and the decision of the Movement and its sponsors.

Examples of Events are the following:
A rigged election
The jailing of an opposition leader
The signing of (or failure to sign) a controversial piece of legislation
A government crackdown against the opposition or the imposition of martial law
Declaring or being involved in an unpopular war

The above are but a few examples. What is pivotal is how they are perceived, framed, and narrated to the public, and allegations, not proof, are most important. " (emphasis added)

Democrats are hoping for much more than Trump's failure. They are systematically trying to destroy him, and our country, under the guise of compassion, inclusivity and of course, "for the children".

Ares Olympus said...

Stuart: Thus, Democrats have a vested interest in Trump’s failure. But, they do not want to have their own fingerprints on the failure.

I think we've been here before, almost exactly 8 years ago, the difference being of course the economy was in a shambles back that winter, and there were literally millions of jobs being lost every month.

---- Mar 3, 2009
On CNN this afternoon, Rick Sanchez asked Rep. Mike Pence (R-IN) — the Chairman of the House Republican Caucus — if he agreed with Rush Limbaugh’s claim that “all Republicans want Barack Obama to fail.” Pence at first demurred, calling Sanchez’s question a “nice try.” “I know what Rush Limbaugh meant,” he said. But after listing off several caricatured aspects of Obama’s economic recovery plan, Pence said, “[Y]ou bet, we want those policies to fail”:

ANCHEZ: Did you hear what Rush Limbaugh said, “the dirty little secret is all Republicans want Barack Obama to fail?” Very direct question to you, Sir. Do you want Barack Obama to fail?

PENCE: Come on, Rick. Nice try. I know what Rush Limbaugh meant. … Everyone like me, Rush Limbaugh and others who believe in limited government, who believes in conservative values, wants the policies that this administration is bringing forward, higher taxes, massive increase in government spending, a huge increase in the role of government, in our daily lives, departure from traditional values. You bet, we want those policies to fail. Because, Rick, we know big government, increases in debt, the micromanagement of the economy out of Washington, DC is a policy that will fail.

So micromanaging is out, and we're not in the era of small government, where two regulations have to be removed to add one new one, except regulations on women's reproductive systems. Those regulations will only increase over time.

Its easy enough to say the Democrats sold out to the corporations, but it seems like every destructive thing the Democrats can do, the Republican can do it 10 times bigger.

Anyway, as Pence admitted in 2009, failure is a point of view. Republicans choose the path of zero cooperation, and they gained the whole table. I don't think it was a good bet.

I also think Trump's definition of failure may be different than the Republicans, or at least Trump's right-hand man, Steven Bannon. The tea party has its vision of going back to the good old days when white people had the power, and minorities kept their place, and so if they succeed, that'll look like failure.

Or like Bannon's quote last summer
Bannon never called himself a “populist” or an “American nationalist,” as so many think of him today. “I’m a Leninist,” Bannon proudly proclaimed. Shocked, I asked him what he meant. “Lenin,” he answered, “wanted to destroy the state, and that’s my goal too. I want to bring everything crashing down, and destroy all of today’s establishment.” Bannon was employing Lenin’s strategy for Tea Party populist goals. He included in that group the Republican and Democratic Parties, as well as the traditional conservative press.

It looks like success and failure will be written with two history books, one in Alt-media, and one with people who live in the fact based world. But if the alt-world wins, they can write the history books.

Is paying for two wars on a tax cut and patting down grandmas at airports failure? At least we've not had another 9/11 attack, so that's success, right?

Anyway, my bet is we'll be in 30 trillion dollars of federal debt by November 1, 2020. Any takers?

And is that success or failure?

Dennis said...

Those who try to start fires are inevitably burnt by that fire which always becomes uncontrollable. Revolutions never redound to the revolutionaries. Fun to watch what we all know is paid protesters with all their preprinted posters and fill in the blank placards. I suspect most of the country is waiting until the cry babies/sore losers get bored with their tantrums and emotional excesses. As one might say, "Please keep alienating more and more people." It worked so well for Hillary Clinton. I would postulate that many people are like me in that if they are damned if they do and damned if they don't they no longer value your opinions or ideas. The product of the urban fed lots of blue malcontents are not the people who control most of the resources and are the useful idiots that history so often condemns. There is nothing that happens in NYC or any other blue area that cannot be accomplished some where else. Become the Confederacy and the same results may occur.
I would hope that Jefferson was not right about revolutions and our need for them. I would rather see a war of word ultimately leading to those who think finding solutions that benefit the majority of this country's citizens. Otherwise, Woe to you urban dwellers because you are wholly unprepared for the fire that will consume you. Most of you could not survive if a real revolution happened due to your own stupidity. That very act of trying to overthrow the duly elected government will be the act that will destroy you. Please do not wake the sleeping dragon.

Ignatius Acton Chesterton OCD said...

Ares Olympus, dredging up 8-year-old political quotes about the *SHOCKING* concept that an opposition party might oppose an agenda drawn up by the opposing executive. To believe this is shocking, you must be (a) a moron, or (b) shockingly naive about the nature of human politics. In your case, Ares, I believe both are applicable.

You see, I am not shocked that Democrats oppose President Trump. Indeed, I would find it remarkable if they agreed with him after losing such a hotly-contested election. What I am disgusted by is these Democrat Senators not doing their jobs by not showing up at committee hearings. We pay them a lot of money to serve in this capacity... too much, given the abundance of applicants/aspirants for the job. I don't hear you prattling on about that.

It would seem you and the Democrats have the same level of maturity and seriousness. It's rank whining.

Grow up! I'd say "Be a man!" if it weren't for you and your ilk going all-in for women as the paragon of our society, closely followed by some glorification of transgender amusement that makes the masculinity you hate and the feminity you disgrace so marginal.

I guess we'll all be wearing the same Star Trek uniforms in your future androgynous world. I suppose the benefit is that we won't have to hear about what a monumental, courageous "achievement" it is for Horace to become Geraldine. After all, he is not now a she, except for in the newspapers and on PBS and NPR.