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Big brain economist folks, is this the plan?
Posted on 3/13/25 at 11:03 am
Posted on 3/13/25 at 11:03 am
Increase tariffs leading to higher cost of items
Demand goes down unemployment goes up and price increases decrease
Fed cuts rates
If so this sucks, and likely have nothing to do with manufacturing coming to US. This is just cyclical behavior.
Demand goes down unemployment goes up and price increases decrease
Fed cuts rates
If so this sucks, and likely have nothing to do with manufacturing coming to US. This is just cyclical behavior.
9
Posted on 3/13/25 at 11:06 am to fareplay
Honestly I think a bigger weapon in the anti-inflation arsenal is the DOGE cuts
Posted on 3/13/25 at 11:11 am to rickyb223
This is nowhere in scale vs tariffs baw
Posted on 3/13/25 at 11:11 am to rickyb223
quote:
Honestly I think a bigger weapon in the anti-inflation arsenal is the DOGE cuts
This. An uncertain level of "austerity" coupled with lower energy costs are pushing inflation down.
Posted on 3/13/25 at 11:33 am to fareplay
quote:
Big brain economist folks
quote:you looking for 'Waterheads' ?
Big brain
Plethora of them posting on the Poli Board
Posted on 3/13/25 at 11:34 am to fareplay
quote:
This is nowhere in scale vs tariffs baw
Almost all govt jobs pay middle class wages.
Now, I’m not advocating using the govt as a jobs program, but it stands to reason that eliminating 200,000+ middle class jobs within a couple months will drop a nuke on discretionary spending.
Posted on 3/13/25 at 11:37 am to rickyb223
Want to avoid being more political here but yeah I think I give it 6 months to level out for that program when all the severance is gone and savings dipped , market may bottom
Posted on 3/13/25 at 11:56 am to rickyb223
quote:
Honestly I think a bigger weapon in the anti-inflation arsenal is the DOGE cuts
You think DOGE cutting 1% of federal spending is going to slow down inflation? You can’t be serious.
Posted on 3/13/25 at 12:11 pm to rickyb223
quote:I think eliminating 10 regulations for every 1 new one implemented is significant.
Honestly I think a bigger weapon in the anti-inflation arsenal is the DOGE cuts
Posted on 3/13/25 at 12:14 pm to rickyb223
quote:
Now, I’m not advocating using the govt as a jobs program, but it stands to reason that eliminating 200,000+ middle class jobs within a couple months will drop a nuke on discretionary spending.
You also have to remember that roughly 1/3 of federal jobs are veterans. We've already seen layoffs at the Veterans Crisis Center and planned cuts to the VA. The VA makes up about 20% of the total federal workforce. Right or wrong, I think there's going to be significant blowback if we see scores of veterans losing jobs.
Lots of good data on the makeup of the federal workforce - LINK /
And this specifies pay ranges. The second lowest paid on avg are in the VA - LINK /
Posted on 3/13/25 at 12:32 pm to fareplay
No. It's pretty clear the only constant here is Donald Trump's religious fervor for tariffs. He truly believes that tariffs are the "more cowbell" economic solution. Need more manufacturing jobs? Raise tariffs! Want to expand housing supply? Raise tariffs! Daycare getting too expensive? Raise tariffs! Higher tariffs and trade barriers are the only public policy position on which he's been consistent for his entire adult life.
In his first term, his tariff enthusiasm was largely buffered by "normies" like Gary Cohn, Steve Mnuchin and, to a lesser extent, Jared Kushner. Trump also had to pay closer attention to the markets since he'd be facing the voters again in 2020.
This time, there are no Gary Cohn's around. Additionally, because Trump can't stick to a plan and operates exclusively on guy instinct and vibes (in fact, if you read The Art of the Deal, Trump expresses mockery and contempt for strategic planning), his advisors cannot get on the same page. Hence the mixed messages from Lutnick and Bessent.
In his first term, his tariff enthusiasm was largely buffered by "normies" like Gary Cohn, Steve Mnuchin and, to a lesser extent, Jared Kushner. Trump also had to pay closer attention to the markets since he'd be facing the voters again in 2020.
This time, there are no Gary Cohn's around. Additionally, because Trump can't stick to a plan and operates exclusively on guy instinct and vibes (in fact, if you read The Art of the Deal, Trump expresses mockery and contempt for strategic planning), his advisors cannot get on the same page. Hence the mixed messages from Lutnick and Bessent.
Posted on 3/13/25 at 12:55 pm to rickyb223
quote:
Honestly I think a bigger weapon in the anti-inflation arsenal is the DOGE cuts
So when you overspend by $20 every month, your biggest weapon is to cut .88 cents from your spending to get out of debt? Please explain.
Posted on 3/13/25 at 1:45 pm to Suntiger
quote:
So when you overspend by $20 every month, your biggest weapon is to cut .88 cents from your spending to get out of debt? Please explain.
Yes.
Usually when spending is (rarely) cut, it’s phased in over an entire year. So if the government cuts 2% in an omnibus bill, it’s really more gradual than that. This is closing in on a 5% cut in less than 2 months. In government terms, that’s as abrupt as it gets.
Posted on 3/13/25 at 1:47 pm to fareplay
quote:Have you asked your wife?
Big brain economist folks, is this the plan?
Posted on 3/13/25 at 2:13 pm to rickyb223
quote:
Almost all govt jobs pay middle class wages.
Now, I’m not advocating using the govt as a jobs program, but it stands to reason that eliminating 200,000+ middle class jobs within a couple months will drop a nuke on discretionary spending.
The entire federal workforce payroll is like 100b a year.
The total US workforce earned like 25T last year.
I can support DOGE's mission to cut out fraud, waste and abuse, but the amount they are able to find and actually "cut" will be closer to a rounding error.
Posted on 3/13/25 at 2:18 pm to fareplay
quote:
Increase tariffs leading to higher cost of items
Demand goes down unemployment goes up and price increases decrease
Fed cuts rates
If so this sucks, and likely have nothing to do with manufacturing coming to US. This is just cyclical behavior.
There's a bit more to it.
The longer-term discussion is that our shite-tastic trade deals over the last few decades seem to have been done with the mindset of "any deal is better than no deal" and as such we've not only been a net importer since the 1970s, we've seen the imbalance double over the last 10-ish years. No economy can have a secure future if it's a net importer, especially to the level we have been, especially with skyrocketing debt.
So what has to happen? A lot of those shite deals have to be renegotiated with the various other countries while also making the US a more attractive place for production to move to. A slightly better tax advantage for being based in the US may not make up for a given tariff for goods sold in another country.
If a recession is coming, then these things need to be in place before the recovery begins (which likely creates the result of pushing the recession sooner than it would otherwise happen).
The recession hits, consumer debt bubble bursts, unemployment shoots up and inflation craters. Enter rate cuts and the fight to cut taxes even more to spur growth. Growth resumes (make no mistake, if the consumer debt bubble pops it's going to be a while before we see positive economic news because that's liable to be a snowball effect on recessionary mechanics), but this time we have more room for more production growth as not only have more businesses moved back to the US but (ideally) trade deals are more favorable to US producers than prior to the recession.
At least, that's how I see it.
Posted on 3/13/25 at 2:38 pm to Bard
quote:
The longer-term discussion is that our shite-tastic trade deals over the last few decades seem to have been done with the mindset of "any deal is better than no deal"
Are you referring to the USMCA deal that replaced NAFTA in 2018? We know who put that in place as he said it was..."the best trade deal they say ever made."
Posted on 3/13/25 at 2:40 pm to JohnnyKilroy
quote:
The entire federal workforce payroll is like 100b a year.
The total US workforce earned like 25T last year.
I can support DOGE's mission to cut out fraud, waste and abuse, but the amount they are able to find and actually "cut" will be closer to a rounding error.
What you won't understand unless you've run a large enterprise is that headcount drives every other cost. It is a magnifier. For every $100M cut in heads, you will end up with 10x savings longer term. Every one of those people costs money to support, but more importantly they SPEND money. All of that rolls up into the budget, and then the negotiations begin from a HIGHER basis than they should be.
I've lived this, and it is not simple to explain, which makes it perfect to be "soundbitten" to death with simplistic but misleading stats like "They only cut $500M in payroll, that's nothing!". This is what's called an accurate lie.
Posted on 3/13/25 at 3:03 pm to rickyb223
quote:
Usually when spending is (rarely) cut, it’s phased in over an entire year. So if the government cuts 2% in an omnibus bill, it’s really more gradual than that. This is closing in on a 5% cut in less than 2 months. In government terms, that’s as abrupt as it gets.
This is nowhere near a 5% cut. You have buyouts that are not factored in and it seems like more than half the staff that is getting fired is being rehired. Not to mention that if there jobs are contracted out, those contracts are always…always more expensive than having in house workers do the job.
Stop hating the federal employee that is making $50K a year and ask why congress is passing laws that require their service. These people don’t just show up to a federal building and say, “hey, I work here now and I make $100K a year.” Some congressman fought for funding for something and somebody has to implement it. Cut the funding and cut the projects and stop using working class Americans as a scapegoat.
Or just admit that this administration has the same spending problem as every other administration and the rest is kabuki theater for the plebes.
Posted on 3/13/25 at 3:32 pm to CharlieTiger
quote:
Are you referring to the USMCA deal that replaced NAFTA in 2018? We know who put that in place as he said it was..."the best trade deal they say ever made."
I don't care about your TDS "gotcha" attempts.
I'm referring to any trade deal since the 1970s which allowed for countries to have outsized tariffs on our goods versus what we tariff on theirs. I wouldn't doubt many of those deals had some other sort of consideration (military, political, etc) but the cumulative effect of them all is likely hurting us far more than helping us now.
This post was edited on 3/13/25 at 3:34 pm
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