TRUMP REGIME

How will Trump fall?

Looney Toons  The  most likely downfall scenario is the bubble bursts, the financial markets crash. Like in 2000 and 2008–2009. Investment accounts and retirement savings are battered, unemployment skyrockets as we enter a recession. Trump thinks his wild unpredictability is good for negotiations ...but that isn’t necessarily good for the economy, business, and financial markets. Markets are wild, unpredictable, chaotic enough as they are. Takes a lot of time to build values, very little to knock down values. Doesn’t take much bad news to knock down values either. Financial markets are very fragile. The financial markets don’t need even more chaos from the White House. There are too many contradictions in his policies, here are some of the contradictions and playing “what-if”:

• Tariffs raise prices stoking inflation.
• Trade partners retaliate US tariffs, imposing their own tariffs on items produced in US and imported into their countries causing less US GDP growth and output.
• FED has to keep rates high to mitigate inflation. Straining housing markets, household budgets, corporate growth, etc.
• Fiscal deficits balloon but US government has to pay higher and higher rates on its ballooning debts.
• Tax cuts for the wealthy widen the fiscal deficit.
• Tax evasion skyrockets as IRS is hobbled and crypto is deregulated, further straining the deficit.
• Mass deportations and/or less immigration causes the labor pool to shrink which drives up wages which in turn further fuels inflation (and in turn, interest rates).
• Fiscal stimulus ends as Biden infrastructure projects are canceled.
• Trump, aggravated by persistently high interest rates that are holding back the economy as well as crippling his real estate empire (high interest rates because of high inflation), figures out how to remove FED chairman Jerome Powell and FED is politicized under the thumb of White House, causing interest rates to be suppressed fueling even more inflation. Maybe delaying the eventual bubble burst but making the eventual bubble burst far worse due to even greater embedded imbalances.

And as usual, the technocratic and well educated Democrats have to come back in and clean up the mess. And of course no thanks from the Republicans; they’ll figure out a way to blame the Democrats for the mess they created. Democrats are like the nerds who help the pretty girls with their homework while those same girls turn around and date the dumb jocks who treat them like crap and bully the nerds.

The above scenario doesn’t necessarily hurt the oligarchs who have the foresight to see the train wreck coming. They quietly “cash out” as the dumb suckers buy into the mania, and when the train wreck happens they come in and buy assets back dirt-cheap, sometimes with government subsidies in the form of “public-private partnerships” as we saw in the aftermath of the bubble bursting in 2008–2009 with programs such as TALF, TARP, PPIP, AGP, etc. Personally involved in helping clean up the mess from the 2008–2009 crash with several of these programs, I saw how the wealthy benefited from government largess to help clean up the mess. I was in the trenches...So in summary, the rich get richer and the rest of us screwed. Nothing new.

Axios - Several major U.S. manufacturing sectors are primed to be clear winners under President-elect Trump's tariff plans — even if consumers take a hit... By making cheap foreign imports more expensive, Trump's tariffs are expected to incentivize domestic manufacturers to expand...

Two very specific industries would potentially win quickly.

1. Energy production — from rare-earth minerals to finished products like solar panels and batteries — would benefit under Tr ump, who in October called tariff "the most beautiful word in the dictionary ... my favorite word."

• The rare-earths supply chain, including 17 metallic elements critical to electronics, is a huge concern for both military and civilian applications. The GAO said in September these minerals are in short supply, and the Pentagon hasn't moved quickly enough to ensure they're not being sold to adversaries.
• A Chinese export ban in December only raises the stakes for boosting production.

2. Makers of critical medical supplies, including vials and syringes, are also potential big winners.

• The U.S. medical supply industry is already under pressure, with multiple single points of failure, and plenty of low-cost international competition.
• Just last fall, Hurricane Helene took out a North Carolina plant owned by Baxter that produced about half of all the IVs used in U.S. hospitals.
• A tariff regime could make it financially viable for more companies like Baxter, Medtronic and Stryker to make more medical products at home for local use.

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