The Trump Economy

[elghund]

Originally Posted by CPT Savajo

It's a collective bi-partisan failure in reality when referring to "Trump's Economy." Every American is feeling the effects of President Nixon's decision from Aug 1971 as that monetary system is still in place. What's realized is that the system is failing as the debt is at unsustainable levels and cannot be paid back.

50 years of price manipulation by the BIG banks is what you're not accounting for or you would have much higher gold prices. Gold is considered a safe haven asset in times of economic uncertainty and it's doing exactly what it should be doing, keeping pace with inflation or beating it which it clearly is and the dollar isn't. Why do you think the ladies are raising rates? Cause the dollar is the thing going down. Gold at $5K an oz still seems undervalued when the analyts at the BIG banks are calling for $6K+ price forecasts within 2026. If people think $5K is high then they'll think $10K is high whenever it hits that mark and it will. A fair price would seem like $100K or $150K an ounce according to experts in the precious metals field.

Commodities are in a super cycle why buck the trend when Trump has already announced Project Vault and JD Vance starting a 50 nation silver cartel at the Minerals meeting he was at a week ago with Little Marco? The $12 billion that Trump pledged for Project Vault seems like a conservative estimate and I think the numbers are much higher than what's being reported. The key thing to know is which companies is the government buying from and are they publicly traded companies in the mining sector.

In this environment the dollar or all fiat currencies is the Titanic, Gold & Silver are the life rafts. Trump knows this. He's telling you he wants lower interest rates and wants to print, print, print with the new Fed head Kevin Warsh and Powell needs to go to the retirement home.

Deflection.

Trying to blame other for a Trump created mess. Typical MAGAtard reaction.

elg…

[RX792P]

Originally Posted by RX792P

Trump math....

"Every point is $600 billion," Trump said. "All he has to do if we went down two points, we don't have a deficit anymore," he claimed.
https://www.foxbusiness.com/politics...st-rates-world

I'd like to see those calculations...

Maybe the Fed should do like Trump did with drugs and lower the interest rate 500%, 600%?

Dang....Trump math gets even worse...

And here I thought (well Trump told me) all that tariff income was going to balance the budget, pay off debt and give me a $2000 'tariff rebate'...

We are again the strongest Country in the World, and should therefore be paying the LOWEST INTEREST RATE, by far.
This would be an INTEREST COST SAVINGS OF AT LEAST ONE TRILLION DOLLARS PER YEAR – BALANCED BUDGET, PLUS. WOW!

https://truthsocial.com/@realDonaldT...52538984100960

[Texas Contrarian]

In my view, the Trump economy is quite a mixed bag. A few unambiguously good things: For example, some regulatory relief (at least relative to the status quo-ante), a boost in tax-based incentives to business capex, the cessation of entertaining "green new deal" fantasies and deep-sixing various impediments to domestic energy production.

But there are some clear negatives: For instance, chaotic tariff policy implementation leading to planning uncertainty which affects smaller firms much more than larger ones, and the continuation of a frighteningly unserious attitude about our disastrous debt-accumulation trajectory.

The extent to which the current (and near future) headline GDP numbers are (or will be) a function of massive spending on data centers and other AI or AI-adjacent spending is uncertain, but you might note new estimates of $650 billion for this calendar year. (That's 2+% of GDP! For how long can that be sustained?)

My take: In other words, the current economy may be "muddling through" (As John Mauldin likes to put it), but it's hardly anything to write home about.

It was mentioned in several earlier posts that the skyrocketing gold price largely arises from severe angst about the US's (and indeed the world's) financial condition.

Just a couple of relevant observations:

Yes, there are certainly concerns about the long-term status of the dollar as a global "anchor" and the risk that it will rapidly decline further in value, or that the US will experience anything resembling hyperinflation. People occasionally get a bit carried away with what we sometimes call "extrapolation bias" and buy into a lot of "doom porn" scenarios? (Any of you old-timers remember Howard Ruff?)

Here is a clip from the sort of movie I've seen before:

Originally Posted by Precious_b

But i'd lay odds that if you invested $100 day 1 Wall Street opened and $100 in gold, the Stock Market would have a better return on investment.

Originally Posted by CPT Savajo

You would lay odds and lose your bet in a simulation ran a billion times over. Such a bet wouldn't be fair from 1834-1933 because gold was pegged at $20, but if we started the bet at 1974 when the American slaves (every citizen living in the US at the time) were allowed to own gold again as a privlege granted by government gold would clearly be the winner.

Really? Where did you read that? (Actually, since it became legal for Americans to own gold bullion just over 51 years ago, the S&P 500 has vastly outperformed gold. And that's not even a close call!)

[RX792P]

Trump math migrates to other officials

Kevin Hassett, Trump’s director of the National Economic Council

The bottom line is that because of President Trump’s tariffs, we’ve got a booming economy. We’ve got a deficit that’s gone down by maybe about $600 billion over the last year.

US defict by fiscal year
Fiscal Year Deficit (approx.)
2021 (Oct 2020–Sep 2021) $2.77 trillion
2022 (Oct 2021–Sep 2022) $1.38 trillion
2023 (Oct 2022–Sep 2023) $1.695 trillion
2024 (Oct 2023–Sep 2024) $1.833 trillion
2025 (Oct 2024–Sep 2025) $1.8 trillion
(Trump took office Jan20,2025)

FY 2026 deficit (Congressional Budget Office (CBO) projection) will be about $1.85 trillion

And we’ve got booming U.S. jobs

Calendar years
Year Nonfarm Payroll Jobs Added
2021 ~ +6.27 million
2022 ~ +3.35 million
2023 ~ +1.80 million
2024 ~ +1.80 million
2025 ~ +0.75 million


Just for reference, FY deficits during Trump's prior term
Fiscal Year Deficit (approx.)
2017 ~$665 billion
2018 ~$779 billion
2019 ~$984 billion
2020 ~$3.13 trillion
2021 ~$2.77 trillion

[RX792P]

Originally Posted by RX792P

Trump reveals the 'stable genius' planning behind his tariffs...

I put on a 30% tariff, which is very low. Still, we were having a big deficit but it was half the deficit and I got an emergency call from I believe the prime minister of Switzerland and she was very aggressive. Nice, but very aggressive. “Sir, we are a small country. We can’t do this. We can’t do this.” I couldn’t get her off the phone. “We are a small country,” and I said, “you may be a small country, but we have a $42 billion deficit with you.” “No, no, we are a small country.” Again and again and again, I couldn’t get her off the phone. So it was at 30% and I didn’t really like the way she talked to us, and so instead of giving her a reduction I raised it to 39%, and then I got inundated by people from Switzerland and I figured, do you know what? We’ll do something that’s a little bit more palatable.

BTW....Switzerland does not have a Prime Minister.

[Turner2099]

Originally Posted by RX792P

Dang....Trump math gets even worse...

And here I thought (well Trump told me) all that tariff income was going to balance the budget, pay off debt and give me a $2000 'tariff rebate'...

https://truthsocial.com/@realDonaldT...52538984100960

Just for reference, the interest paid for the full year 2025 was $1.22T.

https://fiscaldata.treasury.gov/inte...nterest-rates/

[RX792P]

Originally Posted by Turner2099

Just for reference, the interest paid for the full year 2025 was $1.22T.

https://fiscaldata.treasury.gov/inte...nterest-rates/

Thanks...and even if the Fed dropped interest rates to zero today, it would be quite some time before it had any significant effect on interest paid by the government.

[lustylad]

Originally Posted by RX792P

Trump math....

"Every point is $600 billion," Trump said. "All he has to do if we went down two points, we don't have a deficit anymore," he claimed.

https://www.foxbusiness.com/politics...st-rates-world

I'd like to see those calculations...

Well then, why don't you just do the calculations yourself? They're not difficult.

Our current national debt (gross) is $38.6 trillion. Can you compute 1% of that? Good! Now try to compute 2% as well.

Gee, I hope I don't fuck this up... wouldn't the numbers be $386 billion and $772 billion, respectively?

Meanwhile, the CBO is predicting a federal budget deficit of $1.9 trillion for the current fiscal year ending 9/30/26.

So... if interest rates drop by two full percentage points (or 200 basis points) and we assume this would allow the US Treasury to save accordingly on what it spends to service our national debt, then the deficit would shrink by 40% to around $1.1 trillion.

Hey, that wasn't so hard, was it? You could've laid out the actual numbers and showed everyone exactly how much Trump was off. I would call him an idiot too, but at least he is drawing everyone's attention to the problem. That's more than Biden ever did.

But wait - not so fast! The story doesn't end there. That would be too simple. Isn't anyone going to ask what is the current weighted-average interest rate paid by the US Treasury on its outstanding debt? I'll tell you anyway - it's 3.4%. Anyone want to know the average maturity of this debt? Just short of 6 years.

Why is that important? Because the Treasury has to pay the coupon rate on its debt, not the current market yield, which means any general reduction in rates won't translate fully or immediately into interest savings. Another reason to fault trump's logic.

Now I'll let Tiny and Texas Contrarian weigh in on the topic. I know Tiny prefers to track our net debt, which is lower. I prefer to emphasize the gross debt, because it's scarier. Plus I don't want to suggest it's ok and doesn't really count whenever other government agencies (especially the Federal Reserve) buy & own big chunks of this debt.

[RX792P]

Originally Posted by Lustylad

Hey, that wasn't so hard, was it? You could've laid out the actual numbers and showed everyone exactly how much Trump was off. I would call him an idiot, but at least he is drawing everyone's attention to the problem. That's more than Biden ever did.

Trump is not drawing attention to the deficit...he's lying about the solution to the problem (as he does about so many things). That's not helping.

[Turner2099]

Originally Posted by RX792P

Thanks...and even if the Fed dropped interest rates to zero today, it would be quite some time before it had any significant effect on interest paid by the government.

I asked Claude.ai what the US would pay in one year if the Fed dropped interest rates by 2 points. I will admit I also use a calculator.

There are links to all data points if you follow the link at the bottom.

Current situation:

Total US debt: $38.43 trillion as of January 7, 2026 U.S.

Current federal funds rate: 3.5% to 3.75% target range

Average interest rate on total marketable national debt: 3.348% as of January 2026

Interest payments in fiscal year 2025: $1.2 trillion

If the Fed drops rates by 2 percentage points:

This is a significant hypothetical since it would bring the federal funds rate to roughly 1.5-1.75%. However, the impact on total interest costs wouldn't be immediate or proportional because:

Existing debt is locked in - Most of the $38.43 trillion is in Treasury securities with fixed rates that won't change until they mature and are refinanced

Gradual impact - Only new debt issuance and maturing securities would benefit from lower rates

Time lag - The average maturity of US debt means it would take years for the full portfolio to reflect lower rates

Rough estimate for one year after a 2-point cut:

If the average interest rate on the debt gradually declined from 3.348% by about 0.3-0.5 percentage points in the first year (a realistic estimate given the maturity structure), the US would pay approximately:

$1.05 - $1.1 trillion in interest (compared to the current trajectory of around $1.2+ trillion)

This represents potential savings of $100-150 billion in the first year, with larger cumulative savings in subsequent years as more debt gets refinanced at the lower rates.

https://claude.ai/chat/00abe604-adb3...8-7399edf9c060

[lustylad]

Originally Posted by RX792P

Trump is not drawing attention to the deficit...he's lying about the solution to the problem (as he does about so many things). That's not helping.

He's drawing attention to the debt AND the deficit. If our national debt was small & manageable, the interest bill would be an insignificant component of our overall federal spending. The fact that trump is touting this as a reason to lower interest rates is an admission that the debt is spiraling out of control. We urgently need to slash federal spending across-the-board if we really want bond-market yields to come down.

[Precious_b]

Originally Posted by CPT Savajo

You would lay odds and lose your bet in a simulation ran a billion times over. Such a bet wouldn't be fair from 1834-1933 because gold was pegged at $20, but if we started the bet at 1974 when the American slaves (every citizen living in the US at the time) were allowed to own gold again as a privlege granted by government gold would clearly be the winner. Especially if the banksters were not allowed to short gold with paper contracts to control the physical price in which they are losing that war. Gold should already be well over $10K an oz and at the rate it's going up with Trump as President gold could be at $12K an oz at the end of his presidency if he gets his way with the young pencil-pushing Fed head.

Ima having a Deja Vu moment here.
Could have sworn that I had this same convo.

But I don't have the best memory.

Only thing different is I don't think I did a googly about it. So I did one.
And it sez:

"Based on historical data and projected trends leading into 2026, $100 invested in the stock market (S&P 500) would have a significantly higher return compared to $100 invested in gold, assuming both were held from the early days of Wall Street (roughly 1792) to 2026.
While gold is an effective long-term store of value and hedge against inflation, stocks generally offer superior growth through capital appreciation and reinvested dividends.
Historical Performance Breakdown
Stocks (Long-Term): Over the long term (100+ years), stocks have vastly outperformed gold. For example, $100 invested in 1928 would have grown to over $624,000 in the S&P 500 (with dividends) by 2022, while the same amount in gold would have only grown to approximately $8,800.
Gold (Short-Term/Crisis): Gold has outperformed stocks during specific periods of high inflation or market crashes (e.g., 2000–2010). As of late 2025/early 2026, gold has experienced a strong rally due to geopolitical tensions, but it is typically viewed as a portfolio stabilizer, not a primary growth engine. "

So, again, being a non $$$ guy, it seems both have their traits/qualities. But overall Stocks are the better performer on a broader scale. As with the market, gold does well on special circumstances. But I guess that is why a great number of simulations have to be done to find those where it is favoured. Sorta like that Capt Sulley thing landing a big bird in a body of water under his special circumstances.

The real world simulation, which is reality itself, my original statement of dumping same in one and than the other and let time take over, the market did much better than the metal sitting on a shelf.

Personally, I think investing in lead and powder is the safer hedge

Originally Posted by elghund

Deflection.

Trying to blame other for a Trump created mess. Typical MAGAtard reaction.

elg…

Originally Posted by Turner2099

If I understand correctly, it took 50 years to reach the level it was at when Trump took office and then it nearly doubled in price in a year, right?

To me, that doesn't seem like coincidence.

Isn't gold considered to be a hedge against economic uncertainty as much as, if not more than it is an investment vehicle?

"Global central banks are buying large amounts of gold, partly driven by a trend toward de-dollarization and a desire to diversify reserves away from U.S. policy dependence."

"The potential for a weaker U.S. dollar, linked to policies from the returning Trump administration, has further encouraged buying, as investors seek assets to hedge against the dollar's relative decline."

"Expectations that the U.S. Federal Reserve might reduce interest rates, or conversely, concerns about the Fed's independence, have fueled interest in gold."

"The surge in gold has been linked to concerns regarding the Trump administration's 'convention-busting' approach to governance, including sweeping tariff threats against both allies and foes, which create volatility and market anxiety."

"In summary, the rapid, near-doubling of gold prices to record highs in 2025-2026 acts as a "barometer of market anxiety," signaling that many investors are hedging against risks associated with unpredictable trade, geopolitical, and economic policies."

Apparently, gold has only done this once before in 1979-1980,
"When it experienced a massive, rapid surge, with prices nearly doubling in a single year amid high U.S. inflation, oil price shocks, and geopolitical crises."

It looks like Trump's current economy (if that's the right way to put it) and actions are contributing to present global uncertainty.

It's great that people have made money, and I hope you have, too, but is it really a good thing that the price of gold has gotten so high and do we really want the conditions that it looks like will be necessary for gold to double again?

https://www.google.com/search?q=why+...-8#lfId=ChxjMe


https://www.google.com/search?q=is+t...-8#lfId=ChxjMe


https://www.google.com/search?q=has+...-8#lfId=ChxjMe

Originally Posted by CPT Savajo

It's a collective bi-partisan failure in reality when referring to "Trump's Economy." Every American is feeling the effects of President Nixon's decision from Aug 1971 as that monetary system is still in place. What's realized is that the system is failing as the debt is at unsustainable levels and cannot be paid back.

50 years of price manipulation by the BIG banks is what you're not accounting for or you would have much higher gold prices. Gold is considered a safe haven asset in times of economic uncertainty and it's doing exactly what it should be doing, keeping pace with inflation or beating it which it clearly is and the dollar isn't. Why do you think the ladies are raising rates? Cause the dollar is the thing going down. Gold at $5K an oz still seems undervalued when the analyts at the BIG banks are calling for $6K+ price forecasts within 2026. If people think $5K is high then they'll think $10K is high whenever it hits that mark and it will. A fair price would seem like $100K or $150K an ounce according to experts in the precious metals field.

Commodities are in a super cycle why buck the trend when Trump has already announced Project Vault and JD Vance starting a 50 nation silver cartel at the Minerals meeting he was at a week ago with Little Marco? The $12 billion that Trump pledged for Project Vault seems like a conservative estimate and I think the numbers are much higher than what's being reported. The key thing to know is which companies is the government buying from and are they publicly traded companies in the mining sector.

In this environment the dollar or all fiat currencies is the Titanic, Gold & Silver are the life rafts. Trump knows this. He's telling you he wants lower interest rates and wants to print, print, print with the new Fed head Kevin Warsh and Powell needs to go to the retirement home.

CPT is correct in that this isn't a problem we have now that you can point at one person. Takes a village to burn it down But sitting on a bunch of metal waiting for the end of days isn't very productive. Seeing how the situation is today, going back to my $100 market/metal thing, i'd take that $$$$ from the market and leave the market behind. Ima sure at even a devalued face value, the cash is a better thing.

If you gotta invest in metal for bad times, *I* would put it into Lead and hedge with powder.

[RX792P]

https://www.newsmax.com/finance/stre...11/id/1245745/

K shaped economy
The 'hard working blue collar' folks Trump claims to represent aren't doing so well.

Companies ranging from Ralph Lauren, Tabby handbag maker Tapestry, and American Express, to airlines including United and Delta Air exceeded expectations in their results for the most recent quarter as their affluent consumer base spends freely on high-margin goods and services.

Meanwhile, PepsiCo, Kraft Heinz and PayPal have all flagged pressure from lower-income consumers seeking value and deferring purchases to stretch budgets.

The highest-earning 10% of households now account for nearly half of all U.S. consumer spending, according to a Moody's Analytics report based on federal data.

Bank of America's January deposit data showed after-tax wage and salary growth lagging for both lower- and middle-income households, rising just 0.9% and 1.6% year over year, respectively, versus 3.7% for higher-income households.