wdhalgren

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No, he didnt.

Its the same macroeconomy. Same exact one.

Borrow money and spend more than you take in, grow the economy and act like its a good thing.

If you have to use debt to stimulate growth, your economy is NOT working.

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I agree. Obama had 8 years of fiscal stimulus plus the lowest interest rates in history. They finally started raising rates in the last 6 months of his second term. That's not a healthy economy.

During Trump's first 3 years, interest rates were slowly rising and we still ran big deficits, but by fall 2019 the repo market was beginning to signs of strain. Covid came along just in time for another $3T of magic money. I suspect that time is approaching again soon.

Nobody wants to accept that politicians have lost control of our economy. All they can affect, including the president, is the timing of the pain. Start now or wait and get more pain later.

This has become the preferred method of refusing FOIA requests. There should be some standard for information availability, but apparently it works well enough to effectively neuter unwanted FOIA requests at some public funded institutions.

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"More" isn't the same as "everything", so you're ok with us picking and choosing what things we choose to produce and what things we choose to outsource.

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We don't need to produce "everything" we consume. We need to produce "more" of what we consume so that we can balance our foreign trade. If we produce as much (in dollar terms) as we consume, then there's no need to run an external goods deficit to meet demand (in aggregate). We can export some things, import others, but the trade will balance. Picking and choosing what to export and what to import is fine and advantageous, but only if we can net it out to equalize our trade balance.

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Why is that necessary, and where do you draw the line?

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For several reasons. First, if we run a negative trade balance, we are net exporting jobs to other countries. Fewer private jobs, fewer tax revenues, more govt dependency, higher federal and state budget deficits, more foreign dependency in times of stress when we may need that internal manufacturing prowess, like wars, pandemics, economic instability, where internation trade is compromised.

Second, the only way to run a constant trade deficit is to essentially ship excess dollars overseas (we're paying more for imports than we receive from sale of our exports, thus money goes out in the form of US dollars). Then, to keep those dollars from being traded back home on the foreign exchange market (which would steadily devalue the dollar vis a vis other currencies), we need foreigners to (net) hold them or exchange them for dollar based capital assets. In other words, we are dependent on their willingness to support our excess demand for goods, by holding dollars, buying our debt, equities, land, factories, or something else.

It's not just individual year trade deficits (flows) that matter, it's the cumulative amount (stock) of excess dollars we export to the rest of the world over time. After 50 years of negative balance, we have a huge cumulative foreign exchange deficit, and it makes our currency vulnerable to a coordinated attack or just changing economic conditions as noted above. Most countries hold a stock of foreign exchange reserves which can be used to protect the value of their currency in times of emergency (among other uses). We have no meaningful ability to do that because the stock of foreign held dollars/$ based assets absolutely swamps our foreign exchange reserves. Sometimes central banks raise short term interest rates to protect their currency in times of emergency. We have minimal ability to do that because it would crash our debt sodden economy, our banking system and maybe even the US Federal reserve bank itself. I've posted before, because it's true, that a vulnerable currency is as dangerous as a vulnerable military, maybe moreso.

Some people are fine with this situation, because we've been doing it for 50 years straight and it hasn't broken the dollar yet. That kind of retrospective analysis is how disasters happen. Economic risk is like every other kind of risk, let it accumulate long enough and it blows up in your face. Those 50 years of trade deficit in combination with massive budget deficits constitute the greatest source of risk to the United States, IMO.

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To those who argue this I have a question: Given that these same countries with whom we have trade deficits when it comes to tangible goods, we have trade surpluses when it comes to services, why is it only the goods that count when we're talking about what is sustainable and what is going to hurt the dollar?

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The combination deficit (goods and services) was a record high $918 billion in 2024, an increase of $133B from 2023. Both numbers matter, but our deficit in goods (production/manufacturing) dwarfs our surplus in services. We need to produce more of what we consume. That process will be painful and take a long time, but it's necessary.

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Thats because profligate spending. Not trade

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Our constant trade deficits are due to profligate spending, namely consuming more than we produce.

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We've become poorer than the EU.


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. In 2024, the EU ran a global trade surplus in goods of 160B euros. The US ran a deficit of well over $900 billion.


This states the literal opposite

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No, it doesn't. It means we're shipping excess dollars to the rest of the world at the same time we're running huge deficits at home and monetizing debt intermittently. Even interest on the debt is becoming a big problem. The Federal Reserve has been running cash flow negative at times in order to keep IOER high enough to fight inflation. If you think any of this inspires foreigners to hold dollars or dollar based debt, you're wrong. Borrowing to consume is not a sign of wealth.

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true. So is theirs.

We need to stop doing this, elect politicians who arent complicit in this massive debt eh?

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I'm not defending Europe's financial acumen. They are headed the same direction we are. But right now, the US is closer to reckoning day. Huge debt, budget deficits and trade deficits are a recipe for currency destruction. We're leading the race to the bottom and picking up speed.

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We've become wealthier than they..
Thats why

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We've become poorer than the EU. Our current federal debt to GDP is north of 120% according to the Federal Reserve stats. The EU govt debt to GDP is 88% according to their stats. In 2024, the EU ran a global trade surplus in goods of 160B euros. The US ran a deficit of well over $900 billion. We're not getting wealthy, we're getting broke. And most people are just as clueless as you.

I wonder if she would agree if someone called her a bigot. Nothing wrong with that, her social schedule, her choice, but when she starts throwing around pejorative labels is there ever a moment of introspection.

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Don't care about Ukraine and Russia.

Has the economy improved since Trump has been in office?

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The economy has been getting worse for 50 years, more or less. Healing entrenched bad habits of that duration takes a long time and a lot of pain. Don't worry if that's not your preference, because we'll most likely abandon the effort and let our disease continue unabated. I'm sure you'll be much happier after you've earned your first billion.