Posted by pmags 4/6/2025
The Liz Truss moment truly arrived to the USA and the world. We'll see what happen s when an idiot gets to rule a big country like a king.
I think if this continues the most likely thing is that the US Dollar will soon no longer be the world's reserve country. I'm surprised other countries haven't hedged this way already given what happened the last time this administration was in charge, but I would sure be looking for a way out of the US dollar if I was a non-US-country right now.
If the tariffs hold, I would be looking to cut out US-dollars from my transactions as quickly and aggressively as possible. Feels like a couple of cinder-blocks attached to my parachute at the moment, I might not know how to untangle them, but surely it can't be worse than the state I'm in right now.
In the US, I shudder to think what would happen if the economy got this derailed, and everyone's doing everything they can to untangle from it. I would kind of expect China or Europe's stable economies to be a sudden draw that the rest of the world adjust to. And I would be starting to look at what things I can get from the rest of the world as an alternative to the US.
When I voted against this outcome I knew that I voted against the rest of the policy changes from this regime (Encroachment on 1st amendment, General Oligarchy, etc.), but I didn't know I was also voting against a pseudo-scorched-earth economic policy intended to destroy the US. There are real ways in which I hope they are too stupid to know what they're doing because they're digging their own grave. I just also fear the number of people who are going to be in that grave with them.
People are hunkering down. Cutting spending, staying put, watching for their jobs. Moving is expensive so it’s likely to be delayed.
If consumers are less confident about borrowing large amounts, or if banks stop lending freely, then house prices will drop.
Why not?
In a "real" parliamentary system, Trump already would have gotten a no-confidence vote.
Compared to if Liz Truss had been voted in by the public TWICE?
In Australia the Liberal Party in changed the rules to require a 2/3 majority to remove a PM. In America blocking Trump's tariffs or removing him would require less than 1/3 of his party to vote with the opposition. They fear voters would punish them. How many Australian politicians voted for these party room coups knowing it would end their political careers?
Bessent, the only sane member of Trump's cabinet, sounded really worried and stressed last days. This kind of damage, cannot be undone just by saying 'Hey, it was art of the deal'. Confidence in US government is destroyed. Sure there will announcements about 100s or 1000s of Billions that will be invested, but it's just words. Just like DOGE saved how much already ? 1 Trillion $ ? And still not a single person was charged with fraud...
S&P is down 2.5% on 1Y, and up 80% on 5Y, and valuations are at insane, Dot-com bubble levels. If he keeps the tariffs though, the damage can become much much more substantial that this relatively small decline in the markets.
"When a clown moves into a palace, he doesn't become a king, the palace becomes a circus" Turkish Proverb.
Acting like investors won’t reprice treasures as “not the risk free rate” if it’s being transparently manipulated by the government is bad analysis.
That has long been a Republican goal. They want to tear it apart and sell the pieces.
Trade policy is being set by Trump, Navarro (you know, the guy who made up a trade expert to launder his own idiotic ideas) and that vile goblin Stephen Miller. An idiot council.