Category Archives: President Trump

The Trade War Resumes

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Donald Trump on May 5 suddenly revealed that a trade agreement with China was not imminent after all.  To the contrary, the Administration on May 10 raised its earlier 10 percent tariff on $200 billion of Chinese goods to 25%, and threatened to extend 25% tariffs to the remainder of imports from China by late June (roughly $300 billion of goods).  China, of course, retaliated against US exports [announcing reciprocal 25% tariffs on $60 billion of US goods, to start June 1.  Surprised stock markets fell in response, with the S&P 500 down 4 per cent over the first week of the renewed trade war. read more

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Moore Troubles for the Fed

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April 30, 2019 — Of the two men whom Donald Trump had intended to nominate to empty seats on the Federal Reserve Board, Herman Cain has now withdrawn his name.  This leaves the other one, Stephen Moore.

The Senate would have to decide whether to confirm Moore. He has some problems roughly analogous to Cain’s:  he is considered to be under an ethical cloud and he often gets his economic facts wrong.  Cynics might respond that he would thereby fit right in with the roster of Trump nominees throughout the government.  But Trump’s earlier appointments to the Fed have been people of ability and integrity and have been doing a good job, Chair Jerome Powell in particular. Perhaps Trump did not start paying attention to Fed appointments until recently. read more

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Six right predictions in 2018

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December 30, 2018 –– I realize that compiling a list of one’s own past forecasts is self-indulgent.  But perhaps there are readers who will indulge me too, as I run through six predictions that – it seems to me – were mostly proven right this past year.

  • Volatility, as measured by the VIX, had been too low and would rise.
  • The stock market was too high and would fall.
  • Trump would switch from attacking the Fed for low interest rates, as he had during 2010-2016, to attacking it for raising interest rates.
  • Prices of oil, minerals, and other commodities would fall.
  • The December 2017 tax cuts would raise the US budget deficit and national debt (contrary to partisan predictions that they would pay for themselves);
  • and in turn would raise the trade and current account deficits (contrary to Trump’s trade promises). In other words, the twin deficits would return.  They have.
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