re: Big brain economist folks, is this the plan?

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How does this not result in an absolute crash of the American economy and then the world economy?

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It might, but so far it's been orderly with 1-3% daily drops, the MOVE index (bond vol) hasn't spiked yet either. They can't really let it crash because all the risk has been concentrated in government balance sheets post GFC.

I think a huge reordering is going to happen over a weekend not unlike the Nixon Shock or Plaza Accord. We wake up one Monday, gold up, dollar down (especially against the rmb), debt/gdp down on some accounting gimmick and away we go. All our newly found fiscal headroom is used for industrial policy/reshoring.

Xi wants this too btw in some form or fashion. He wants to consume more of his production and he needs a stronger rmb (against the usd) to do that. Conversely, we want to produce more of our consumption. Not going to war over the details on how that gets accomplished is the name of the game for the foreseeable future.

We’re going to be replaced. It’s going to happen. The entire reason we are the reserve currency is our relative stability to the world.

The last 2 months have demonstrated that to be a farce.

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No. We are still the prettiest girl at the fair by far.

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That’s why I said “going to be replaced” rather than “have been replaced”. The gears are now in motion.

I think technology and the general inter connectedness of the world will make that process go a bit faster than a time period wherein plumbing was a huge advantage.

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I think technology and the general inter connectedness of the world will make that process go a bit faster than a time period wherein plumbing was a huge advantage.

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It's the opposite. The modern economy is much more fragile to disruption. We rely so much on technology that slight disruptions have exponentially larger effects.

And technology is small potatoes compared to petro. Without a steady source of petro in the majority of the world, we're back in the 17 or 18 century technology-wise pretty quickly. The countries like the US who have petro can survive for a time...until things break. Then when we can't fuel huge ships to bring cargo and the areas that produce parts/tech we need don't have petro and are worthless, we don't have petro.

The part that leads to collapse is the snowball that occurs when a modern society reverts back to an older society without the knowledge of how to make that society work, so you transport all of us to the 18th century and within a generation we're at the level of the 12th century.

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Go find a chart with deaths of despair (suicide/drug OD) overlayed with capital exports (plants/factories) since China joined the WTO.

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Yes. Lower class white people have adapted poorly to the modern economy by making bad choices, causing non-Leftists to see this as a crisis (as the Leftists discussed these same externalities with black people for decades prior)

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The plan that made much of America poor that included NAFTA and Chinese inclusion into the WTO is being unwound.

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Subsidizing bad decision makers by taking from producers is Leftism that makes everyone poor. We've seen this redistributive policy fail over and over.

At least this time your type isn't claiming this is real Communism and you're using a different label to describe the failed policy. It removes some irony.

What does that have to do with poor white people becoming bad decision makers and your desire to use Leftism to subsidize their limited economic outlook post-bad decisionmaking?

If we stop babying them and they start making better economic decisions, it solves the problem. There are economic opportunities out there for them, also, as the trade economy has a huge demand for workers. It's just harder work than their former options of suboptimal, overpaid lower-level factory work (the output of poor countries)

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Appreciate your comments

At the end of day the Trump admin's ambition is to reduce the 10yr treasury right? If they are pushing capital out of us dollars(trade deficit, non-us defense spending etc) wouldn't that actually increase the 10yr?

For positioning, I agree mostly. I'm leaning more into commodity plays and real assets, including private. I'm more convinced on gold rather than bitcoin.

One contrasting point to consider is if you expect mag7 to face headwinds, that will certainly impact your grid buildout.

On the Mar a Lago Accords- I find this to be such an interesting concept. Would countries accept a 100yr bond with no yield to pay for defense protection? I find that incredibly unlikely

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Yes, they desperately need the 10 yr under 4, well under if possible, with 7T to refi plus the 2T+ deficit. Talking equities down and hand waving/ranting about tariffs worked as much it is going to imo. Yields bottomed on 2/28 and have started heading up again.

No, I do not think 50-100 yr traditional USTs in exchange for defense will work. If they juiced them it might, by juice I mean adding a sweetner, gold and/or btc on the yield curve. Ex: $1000 50yr gold bond with substandard rate but $100 of that buys gold for Ft. Knox. At term you get $900 back plus a gold amount that was valued at $50 when you bought the bond, govt keeps the other $50 worth of gold (which presumably has appreciated more than enough to compensate for the shitty rate).

This could move us to a two tiered dollar system, domestic usd/tier 1, Eurodollar/tier 2. Americans get access to tier 1 juiced bonds as do American allies who meet certain criteria. If the Brics want to trade primarily in RMB they can still buy US debt but tier 2, shitty rates, i.e., certificates of confiscation, lol.

If this works the Treasury basically becomes the Fed, setting rates etc...much like it worked in the late 40s, the last time we were in fiscal dominance from the ww2 debt overhang.

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They have to get the dollar and yields down to reshore without blowing up the system. My guess is a gold write up is coming later this year to accomplish that if Powell won't play ball by capping yields, aka, by QEing Trump's agenda

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What's the magnitude of a gold write up? $500B? Would that move the needle enough?

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I couldn't care less what kind of employees they are. Just cutting jobs to cut jobs is a poor decision, imo. It's not doing anything to cut waste, imo.

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Firing DEI hires and eliminating the positions is absolutely cutting waste! How does having an "LGTBQRSTUV+ outreach liaison" a benefit to the national park system?

And anyone hired under DEI policies for regular positions should certainly be cut. If the hiring was due to anything other than merit, the best person was not hired.