Deficit Spending

Knave Dave's picture

Trump's corporate tax cut is the largest in US history, but it's another giveaway to the top 10%, including himself. It comes with no constraints so it will be spent on more stock buybacks and bigger bonuses. If you want a place at the table, you're going to have to fight for it; otherwise, you can stay below with the rest of the dying middle class and lick up the crumbs.

Why The Fed Is "A Terrible Parent"

"My goal is for my children to always be happy, to never experience pain, or sadness, or disappointment. To always get what they want, and to never have to hear the word ‘No.’" ...But spoiled kids take greater and greater risks, do dumber and dumber things, because there are never any consequences for their actions.

Clintonomics vs. Trumponomics

Immigration, terrorism, foreign policy, and the candidates' potentially problematic personality traits have dominated the 2016 US presidential race, and far less has been said about their proposals for the economy. But there are substantial differences between the two candidates in this respect, too, and they need to be examined.

Debt, Deficits & Economic Warnings

The processes that fueled the economic growth over the last 30 years are now beginning to run in reverse, and when combined with the demographic shifts in the U.S., the impact could be far more immediate and prolonged than the media, economists and analysts are currently expecting...It is simply a function of the math.

G-20 Meeting Ends With Rising Discord Between China And US

While the G-20 group traditionally tries to put on a united front, a curious divergence emerged following the latest meeting in China, where as Bloomberg notes Chinese and U.S. officials "showed signs of being at odds on how synchronized efforts to boost global growth need to be, with China stressing the need for improved coordination more than the U.S."U.S. Treasury Secretary Jacob J. Lew on Thursday talked down the need for crisis-level coordination as he headed to Chengdu, China, for the meeting.

7 Things Trump Must Do

"We the undersigned urge you, the presumptive Republican nominee for President, to support a rebirth of free-market capitalism in the U.S. You have said repeatedly that you want to make American great again. We agree with you. And we assert that the most effective way to start that process would be to affirm your principled support for economic liberty, for open and competitive markets, and for a foreign policy that rejects both protectionism at home and interventionism abroad."

Why Helicopter Money Won't Push Stocks Higher

In effect, helicopter money turns the entire economy into a Ghost City. Things look busy and productive until the day the helicopter money runs out. From that day on, everything crashes back to reality and tumbleweeds are soon blowing down empty streets.

Larry Summers Wants To Give You A Free Lunch

According to Summers, with this low growth and low interest context, government debt levels no longer matter. In other words, federal governments have free reign to massively increase deficit spending and run-up federal debts, because, on balance, the fiscal stimulus will pay for itself. But who are we to question Summers’ unique qualifications - for example, unlike Summers, we’ve never lost $1.8 billion of other people’s money.

Krushing Krugman? Lacy Hunt On The Negative Multiplier Of Government Debt

The trap is listening to Keynesian economists like Krugman because doing so only digs deeper and deeper debt holes. The real solution is a writedown of unproductive debt, not increased fiscal stimulus. Instead central banks attempt to cram more and more debt into a system clearly overloaded with debt.

Bill Gross Says Yellen "Worships False Idols" So "Worry About The Return Of Your Money, Not On It"

"Investors should not hope unrealistically for deficit spending any time soon. To me, that means at best, a ceiling on risk asset prices (stocks, high yield bonds, private equity, real estate) and at worst, minus signs at year's end that force investors to abandon hope for future returns compared to historic examples. Worry for now about the return "of" your money, not the return "on" it."

August 15th - The Date Which Will Live In Monetary Infamy

August 15, 2016 will mark the 45th anniversary of President Nixon’s decision to close the gold window. U.S. citizens and the government are now beholden to the consequences of years of accumulated debt and weak productivity growth that have occurred since that day. Now, seven years after the end of the financial crisis and recession, these consequences are in plain sight. The Fed finds themselves crippled under an imprudent zero interest rate policy and unable to raise interest rates due to fear of stoking another crisis.

Peter Schiff: "Brexit Is Just What The Doctor Ordered"

British voters may not know what they will get with an independent Britain, but they knew that something was rotten, not just in Denmark, but all over the European Union. The same holds true in the United States. Until our leaders can paint more realistic pictures of where we are and where we are going, we should expect more “surprises” like the one we got yesterday.