I mostly agree with your analysis, but this caught my eye:
"When you frame the record that way, is it surprising that voters decided returning him to the presidency might lead to both more stability and better economic outcomes?"
I (naively) believed that there was an unspoken but tangible rule in politics that You Must Be This Decent To Be President, a bar that by any measure Trump fails to clear. I now know better, of course, but it's dismaying to know that, given the proper economic circumstances, Americans will elect any rogue, scoundrel, or lackwit to the Oval Office. The world is a much more frightening place since I learned this.
Like a lot of people who take time to comment on substacks, I've a read a zillion takes about "why Trump won and won again". He tapped into a latent nativism, the "China shock" was more impactful then we realized, there is a latent bigotry in this country that had become verboten to speak about from prominent politicians that he tapped into, it's the inflation stupid, he doesn't talk like 20 different consultants crafted his answer, his existing celebrity etc. All explanations that I think have some validity to an extent (especially the "it's the inflation stupid" one).
And yet I hear this man speak for five minutes and to this day 10 years later, I think to myself "how in god's name do you think this man is capable of running the lemonade stand let alone be in charge of the most powerful military in the world. He literally can't put basic sentences together. If you're uncle talked like this, you'd have a family conversation about whether you need to take the car keys".
Call me an out of touch elite all you want but to this day, I honestly think the correct answer to his fans is "seriously this guy?! How can you possibly vote for this man?"
Right. I don't care what inflation is like, or how unsettled Americans were by the pandemic; it's never the right move to vote for the wrong candidate. And I have difficulty imagining a candidate worse than Trump.
(I say that now, but in 2028 Scott Baio will no doubt be competing for the Republican nomination.)
November 2024 thoroughly disabused me that Americans care about the moral character of the President. What a tragedy. If a candidate is considered better on the economy and security (even undeservedly or falsely), that seems to be enough. I think Trump could have literally shot someone on Fifth Avenue and he either still would have won or come damn close.
"I now know better, of course, but it's dismaying to know that, given the proper economic circumstances, Americans will elect any rogue, scoundrel, or lackwit to the Oval Office."
I'm old enough to remember when Democrats and their allies gave us every excuse for why it's totally fine that the president got a blow job from his intern in the Oval Office and then lied about it (I'll never forget that finger wagging at us when doing so too), no need to step down, no sir.
You and others may not think there's a through line from Clinton to Trump, but some of us know better.
Agree with the clear assessment here, but..."mostly satisfactory" covid response?? I seem to remember a president first praising China for doing a great job containing it (they werent) while denying it would come here, and then, when it arrived, saying it would quickly go away, when he had *data telling him the exact opposite*. He was in unsupported downplaying mode for months. He undermined testing and tracking efforts. He scoffed even at reasonable late pandemic requests to wear masks to indoor gatherings. He suggested we try bleach on patients, publicly. Then he got a life-threatening case himself, thoughtlessly spreading it to others. Project Warp Speed (and not going along with outdoor mask wearing/other early alarmism) is doing a LOT of heavy lifting in "mostly satisfactory". It was an unforseen unprecedented situation and would be for any president, granted, but "mostly satisfactory" is your takeaway? Wow.
Well, his more recent behavior and attitude has provided a strong contrast to make his earlier COVID-era response look a lot better.
But, I think the bigger factor was that he mostly left the hard work (especially Warp Speed) to competent professionals who knew what they were doing, and despite coming out and saying the random stupid things, left them alone to do their thing (even Fauci).
To make an analogy, Trump 1.0 was the kid who gets invited into the cockpit to talk with the pilot and points and asks the pilot to take a more interesting route, or pointing and asking what a red button does. Trump 2.0 is the kid jumping into the co-pilot seat and randomly yanking around on the control stick.
Despite his very obvious personality flaws during the pandemic, it’s not obvious to me that the outcome would have been very different with someone else in charge in 2020. That may be why the "mostly satisfactory" rating makes sense to many.
"Someone else", ok. I suppose another leader could've dragged their feet, downplayed, and willfully undermined, in their own ways. No one could've handled it perfectly of course. Then imagine someone who simply knew early on to take it seriously and acted accordingly, who had a plan in place, who hit the ground running and didn't undermine efforts to get it under control (but rather boosted them), who rallied industry and public sentiment, who rejected misinformation and image concerns (This doesn't seem crazy to expect, and would've been superior to what we got). Someone with an ability to adapt as we learned about the virus, with a strict focus on the public good, shutting out the noise. Taking the polar opposite tack to pragmatic and responsible competency does more damage, I think, particularly from a leader heavily burdened by myopic image-fretting and publicly touting misinformation. His personality disorder made him a uniquely poor leader for that situation. We can't know to what degree it would've been different, but presumably doing the opposite of everything he did wrong could get a very different outcome.
There were other leaders at that time. This was a global issue. Other than extreme measures that were taken in places like Australia and New Zealand, nothing really worked. Biden did a poor job even though the vaccine was ready when he took office. More people died in 2021 compared to 2020. Other than better leadership vibes and optics, I don't agree with the argument that another President would have achieved significantly better results in 2020.
Biden didn’t help much after the vaccine rollout, declaring it over prematurely. So yeah, someone stronger and more capable than Biden in place when it hit, which would’ve improved eventual vaccine uptake as well, being Trump supporters drove vaccine denial. (To be fair, a Biden admin wouldn’t have gutted the Obama pandemic protocols. Biden even tweeted in October 2019 we weren’t prepared for a global pandemic. Look it up.) Anyone doing the polar opposite of the particular performative foot-dragging and willful undermining Trump engaged in from the get-go, which Josh oddly labels “mostly satisfactory” (unless he strictly means the big policy moves in a vacuum, warp speed and stimulus (?), then okay), an engaged, more impervious to public opinion leader than Biden, certainly. I’m saying there’s a plausible scenario where it could’ve gone far better, pre and post vaccine. I get it’s theoretical Monday morning quarterbacking, but it isn’t out of the realm of possibility we could’ve had more successful proactive leadership.
At the tender age of 84, I get the feeling the political system is playing with my mind. Four years ago a guy who ran on a return to "normalcy" won and delivered open borders, inflation and wokeness. Four years later a guy who ran on making America great again is busy tearing up the alliances and trading policies that we adopted when we were "great" before and have sustained us ever since. I don't expect a return to the likes of FDR, Truman and Ike, but is it too much to hope for an approximation of Reagan, the elder Bush and Clinton?
Might help to note that the “McKinley tariffs” were not part of his presidency but during his tenure leading the 1890 Congressional Republicans, who in the next election lost almost half of their seats.
From what I remember from history class, 1893 brought a deep economic depression, the worst until the Great Depression. Could that have been the result of the tariffs?
From my reading, there were a lot of factors, and although Tariffs may have been a contributor, there were other and more significant causes. And the underlying volatility without the fiscal tools we now have with the Federal Reserve (which was formed following a series of these "panics" in the 1880s and 1890s).
I don't seem to hear much "Abolish the Fed" talk now, but proponents of it clearly don't have a grasp of what economic cycles were like before we had one.
Lastly, the neighborhood we lived in during our time in Omaha, Nebraska still very much displayed the effects of the 1893 panic and prolonged depression that followed it. The neighborhood was a streetcar suburb platted in the 1880s, and began to be built with Victorian homes on the most desirable lots. It was only ~20% built out by the time of the panic, though, and due to the downturn (especially in railroads, which was a significant share of the Omaha economy at that time), the remaining lots weren't built on until the teens and twenties. Our home was a 1913 Foursquare, and one of the many Foursquares and Craftsmans infilling the majority of lots between the scattered Victorians.
Scott Bessent nearly in tears today during the Bloomberg interview post tariff announcement was hilarious. He was asking countries to not retaliate and mentioned that the rates published today, Apr 2, were the ceiling and not necessarily the floor. Deeply stupid times.
Are we entering some weird new cycle where every hundred years the Democrats have to rescue Capitalism from the Capitalists? Because that doesn't seem ideal.
Does anyone have any idea what the deal is with the numbers on that chart he produced (https://x.com/sentdefender/status/1907533597839675892?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet)? I genuinely thought that Trump conflated VATs with tariffs (they aren't because they are also assessed on domestically produced products, but they "feel like" a tariff because they are assessed on products upon import) and that much of his world view came from this belief. The thing is that his "tariffs charged to the US" number on the chart has a poor relationship with the VAT and is sometimes a lot lower.
I am open to "all of these numbers are fake and he is going based on his vibes about countries". Way too many numbers are 10% for this to be totally real. But I wonder what is going on here.
The numbers are made up. I don't know about the extent to which they were made up by using some nonsense formula vs. made up by just writing numbers down, but I don't think it really matters.
Deep cut for those of us who read way too many substacks and actually read some of these wonky books.
Gotta say, I was at least partially taken in like Obama was. I think I wanted to believe there was “one weird trick” to getting people to wash their hands more or get people to save more for retirement.
The thing is, I still think “people are predictably irrational” is substantially correct (see my comment above about traders/hedge fund managers irrationally believing Trump was bluffing about tariffs). Think behavioral economics has a lot to recommend. So it makes it all the more galling to see Ariely made up his data because (as far as I can tell) he’s just that committed to libertarianism.
Mostly agree with this*. Though wanted to ask, what is your theory behind why the markets have actually been up this week. A few theories but wondering if you agree:
- Too many traders still think this is all a bluff despite ample evidence to the contrary. So they are "buying the dip". In addition, the market is increasingly made up of retail investors many of whom are Trump super fans who have drank the Trump Kool-Aid
- There is a base case that Trump will actually just reverse course and pivot away from tariffs. Given this is basically the one policy Trump has any consistent conviction on (see this clip from Oprah decades ago. https://www.youtube.com/shorts/i7z2tUePt8c Also likely one reason he was Democrat back in the day) I have my serious doubts (or doubts he will fully reverse course anyway). Plus, he's surrounded himself with sycophants in a way he didn't last time. However, Trump is also famously fickle and changes his mind all the time. And he cares A LOT about Wall Street thinks about him.
- The tariffs proposed are massive. As you noted, there is a big danger of recession given the massive increase costs if tariffs are implemented. Plus as you note, the wishy washy nature of Trump's "will or won't he" is a big hit to investment given business owners don't really know what to do. But because this tariff is big enough to cause recession it will perversely bring down inflation due to massive job losses and decrease in consumer spending. My case for this is the 10-year has actually climbed down last few months (also consumer spending lately has been completely propped up by top 10-20% of earners if WSJ is to be believed. Given market collapse, the attendant hit to "wealth effect" will slow down consumer spending at the top and bring down inflation (in theory))
- The economic impacts of tariffs won't happen overnight. Precisely because people still think Trump will backtrack, there hasn't been big prices increases quite yet, nor massive layoffs if business owners think Trump will back off. But give it another month or two and we could see a "tipping point" scenario where the bad impacts start happening all at once. So ignore strong job numbers that came out today; probably a "too soon to be impactful" situation.
What say you? Does any of what lay out make sense to you?
* While you're likely right I think would be a massive mistake for Democrats to sit on their hands and just wait for bad economic news to bolster their midterm changes. If nothing else, I do actually think we are the brink of constitutional crisis. There is to me a very danger to this country right now that warrants being more combative on the merits. Plus just purely on politics, if Joe Rogan's recent comments are anything to go by, it seems like swing voters are actually alarmed by stuff like Gestapo like snatching of innocent people off the streets*.
Based on S&P and Nasdaq futures, feel like bullet point 1 seems like the answer here.
The number of people of clinging to the "there are still adults in the room" mindset is depressing. Although that's perhaps why this "Signal" story took off. One it's hilarious and involves social media so perfect mix to get traction. But the other reason is maybe the dawning realization the adults in the room are not actually adults but people way in over their heads. Would have thought a cursory reading of Pete Hesgeth would have convinced enough people this man has no business running DoD, but I continually am astonished at delusional lies people can tell themselves.
Maybe that's the answer. No one, absolutely no one likes to admit they have been conned. Its embarrassing and humiliating. But its also why cons succeed.
I think the market anticipated the tariffs to be much more moderate and targeted to specific countries/sectors. 10% was swirling around, but ended up being the base rate and many more countries were involved for no discernable reason. I think there was also some sentiment that this could be a continued negotiation tactic that would be temporary and removed over the course of the next few months. Now there are more indications that he is very much committed to this "strategy" long term. Israel removing tariffs ahead of the announcement and still be subjected to a 17% penalty is pretty compelling proof that it doesn't really matter what concessions these countries make.
This moment has been kind of clarifying as to the "How could Trump win" conversation. It seems really clear that tons of people internalized the idea that a lot of the warnings about the dangers of Trump was hyperventilating from over zealous libs and never Trumpers.
So as Josh notes, 2016 happens, dire warnings occur, all sorts of lib freakout (including me) occurs, a lot of the worst warnings don't come to pass even though he says and does plenty of crazy stuff so lots of normies conclude that most of the worst stuff is dare I say "fake news".
Think it also kind of speaks highly of various cabinet members and advisors around Trump the first term because it turns out as bad as he was they really were preventing a lot of the worst stuff from happening behind the scenes.
I feel like a north star for me is John Bolton as almost an avatar of too many of his supporters and even maybe swing voters. It seems as though based on the numerous interviews he did on Fox pre 2018 that he totally bought the narrative that all of these warnings about Trump was lib exaggeration and even dare I say, "a witch hunt". And then he gets the White House and discovers it's even worse than Libs and Never Trumpers say it is.
I think to me it speaks to how much of Trump's success is downstream from Fox and right wing media's ability to set the narrative; even if there actual news numbers are low they clearly have an ability to sway public opinion through 2nd and 3rd order effects.
That’s fair, I forgot the precise wording, and I apologize! You did call him “broadly a conservative in good standing” and positively contrasted his nomination with RFK’s, which at the time I interpreted to mean that you thought he might do a better job. (I disagreed then and still do, but maybe you didn’t mean that.)
I said, in November, that he was more likely to be confirmed than RFK, because (unlike RFK) he was not ideologically crosswise with any key GOP constituencies. I was wrong as to RFK’s confirmation, but I never assessed that Hegseth was likely to perform well. In fact, I wrote “I don’t think Hegseth is well-qualified at all.” So, you’re disagreeing with something I never said or believed.
But also, in theory the markets are forward looking. Plus it's very clear leaks very quickly get to enough traders to start moving the market no matter who's President. And this Presidency is almost farcically leaky.
If you're right, this basically to me validates my theory that too many people just don't believe Trump will follow through despite ample evidence to the contrary.
Trump said repeatedly during the campaign that he planned to impose steep tariffs. Unfortunately voters chose not to listen or didn’t care at the time, or they didn’t understand what tariffs are. It was a failure of the Harris campaign that they didn’t hit Trump hard on that, running ads explaining that the tariffs would raise prices.
I mostly agree with your analysis, but this caught my eye:
"When you frame the record that way, is it surprising that voters decided returning him to the presidency might lead to both more stability and better economic outcomes?"
I (naively) believed that there was an unspoken but tangible rule in politics that You Must Be This Decent To Be President, a bar that by any measure Trump fails to clear. I now know better, of course, but it's dismaying to know that, given the proper economic circumstances, Americans will elect any rogue, scoundrel, or lackwit to the Oval Office. The world is a much more frightening place since I learned this.
Like a lot of people who take time to comment on substacks, I've a read a zillion takes about "why Trump won and won again". He tapped into a latent nativism, the "China shock" was more impactful then we realized, there is a latent bigotry in this country that had become verboten to speak about from prominent politicians that he tapped into, it's the inflation stupid, he doesn't talk like 20 different consultants crafted his answer, his existing celebrity etc. All explanations that I think have some validity to an extent (especially the "it's the inflation stupid" one).
And yet I hear this man speak for five minutes and to this day 10 years later, I think to myself "how in god's name do you think this man is capable of running the lemonade stand let alone be in charge of the most powerful military in the world. He literally can't put basic sentences together. If you're uncle talked like this, you'd have a family conversation about whether you need to take the car keys".
Call me an out of touch elite all you want but to this day, I honestly think the correct answer to his fans is "seriously this guy?! How can you possibly vote for this man?"
Right. I don't care what inflation is like, or how unsettled Americans were by the pandemic; it's never the right move to vote for the wrong candidate. And I have difficulty imagining a candidate worse than Trump.
(I say that now, but in 2028 Scott Baio will no doubt be competing for the Republican nomination.)
November 2024 thoroughly disabused me that Americans care about the moral character of the President. What a tragedy. If a candidate is considered better on the economy and security (even undeservedly or falsely), that seems to be enough. I think Trump could have literally shot someone on Fifth Avenue and he either still would have won or come damn close.
Elections are a choice and neither party has covered itself in glory.
"I now know better, of course, but it's dismaying to know that, given the proper economic circumstances, Americans will elect any rogue, scoundrel, or lackwit to the Oval Office."
I'm old enough to remember when Democrats and their allies gave us every excuse for why it's totally fine that the president got a blow job from his intern in the Oval Office and then lied about it (I'll never forget that finger wagging at us when doing so too), no need to step down, no sir.
You and others may not think there's a through line from Clinton to Trump, but some of us know better.
Ah, the tu quoque defense!
When is the next podcast?
Agree with the clear assessment here, but..."mostly satisfactory" covid response?? I seem to remember a president first praising China for doing a great job containing it (they werent) while denying it would come here, and then, when it arrived, saying it would quickly go away, when he had *data telling him the exact opposite*. He was in unsupported downplaying mode for months. He undermined testing and tracking efforts. He scoffed even at reasonable late pandemic requests to wear masks to indoor gatherings. He suggested we try bleach on patients, publicly. Then he got a life-threatening case himself, thoughtlessly spreading it to others. Project Warp Speed (and not going along with outdoor mask wearing/other early alarmism) is doing a LOT of heavy lifting in "mostly satisfactory". It was an unforseen unprecedented situation and would be for any president, granted, but "mostly satisfactory" is your takeaway? Wow.
Otherwise very sharp piece as usual.
Well, his more recent behavior and attitude has provided a strong contrast to make his earlier COVID-era response look a lot better.
But, I think the bigger factor was that he mostly left the hard work (especially Warp Speed) to competent professionals who knew what they were doing, and despite coming out and saying the random stupid things, left them alone to do their thing (even Fauci).
To make an analogy, Trump 1.0 was the kid who gets invited into the cockpit to talk with the pilot and points and asks the pilot to take a more interesting route, or pointing and asking what a red button does. Trump 2.0 is the kid jumping into the co-pilot seat and randomly yanking around on the control stick.
Despite his very obvious personality flaws during the pandemic, it’s not obvious to me that the outcome would have been very different with someone else in charge in 2020. That may be why the "mostly satisfactory" rating makes sense to many.
"Someone else", ok. I suppose another leader could've dragged their feet, downplayed, and willfully undermined, in their own ways. No one could've handled it perfectly of course. Then imagine someone who simply knew early on to take it seriously and acted accordingly, who had a plan in place, who hit the ground running and didn't undermine efforts to get it under control (but rather boosted them), who rallied industry and public sentiment, who rejected misinformation and image concerns (This doesn't seem crazy to expect, and would've been superior to what we got). Someone with an ability to adapt as we learned about the virus, with a strict focus on the public good, shutting out the noise. Taking the polar opposite tack to pragmatic and responsible competency does more damage, I think, particularly from a leader heavily burdened by myopic image-fretting and publicly touting misinformation. His personality disorder made him a uniquely poor leader for that situation. We can't know to what degree it would've been different, but presumably doing the opposite of everything he did wrong could get a very different outcome.
There were other leaders at that time. This was a global issue. Other than extreme measures that were taken in places like Australia and New Zealand, nothing really worked. Biden did a poor job even though the vaccine was ready when he took office. More people died in 2021 compared to 2020. Other than better leadership vibes and optics, I don't agree with the argument that another President would have achieved significantly better results in 2020.
Biden didn’t help much after the vaccine rollout, declaring it over prematurely. So yeah, someone stronger and more capable than Biden in place when it hit, which would’ve improved eventual vaccine uptake as well, being Trump supporters drove vaccine denial. (To be fair, a Biden admin wouldn’t have gutted the Obama pandemic protocols. Biden even tweeted in October 2019 we weren’t prepared for a global pandemic. Look it up.) Anyone doing the polar opposite of the particular performative foot-dragging and willful undermining Trump engaged in from the get-go, which Josh oddly labels “mostly satisfactory” (unless he strictly means the big policy moves in a vacuum, warp speed and stimulus (?), then okay), an engaged, more impervious to public opinion leader than Biden, certainly. I’m saying there’s a plausible scenario where it could’ve gone far better, pre and post vaccine. I get it’s theoretical Monday morning quarterbacking, but it isn’t out of the realm of possibility we could’ve had more successful proactive leadership.
At the tender age of 84, I get the feeling the political system is playing with my mind. Four years ago a guy who ran on a return to "normalcy" won and delivered open borders, inflation and wokeness. Four years later a guy who ran on making America great again is busy tearing up the alliances and trading policies that we adopted when we were "great" before and have sustained us ever since. I don't expect a return to the likes of FDR, Truman and Ike, but is it too much to hope for an approximation of Reagan, the elder Bush and Clinton?
I would taken any one of them in a heartbeat!
Might help to note that the “McKinley tariffs” were not part of his presidency but during his tenure leading the 1890 Congressional Republicans, who in the next election lost almost half of their seats.
From what I remember from history class, 1893 brought a deep economic depression, the worst until the Great Depression. Could that have been the result of the tariffs?
From my reading, there were a lot of factors, and although Tariffs may have been a contributor, there were other and more significant causes. And the underlying volatility without the fiscal tools we now have with the Federal Reserve (which was formed following a series of these "panics" in the 1880s and 1890s).
I don't seem to hear much "Abolish the Fed" talk now, but proponents of it clearly don't have a grasp of what economic cycles were like before we had one.
Lastly, the neighborhood we lived in during our time in Omaha, Nebraska still very much displayed the effects of the 1893 panic and prolonged depression that followed it. The neighborhood was a streetcar suburb platted in the 1880s, and began to be built with Victorian homes on the most desirable lots. It was only ~20% built out by the time of the panic, though, and due to the downturn (especially in railroads, which was a significant share of the Omaha economy at that time), the remaining lots weren't built on until the teens and twenties. Our home was a 1913 Foursquare, and one of the many Foursquares and Craftsmans infilling the majority of lots between the scattered Victorians.
Scott Bessent nearly in tears today during the Bloomberg interview post tariff announcement was hilarious. He was asking countries to not retaliate and mentioned that the rates published today, Apr 2, were the ceiling and not necessarily the floor. Deeply stupid times.
Are we entering some weird new cycle where every hundred years the Democrats have to rescue Capitalism from the Capitalists? Because that doesn't seem ideal.
Does anyone have any idea what the deal is with the numbers on that chart he produced (https://x.com/sentdefender/status/1907533597839675892?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet)? I genuinely thought that Trump conflated VATs with tariffs (they aren't because they are also assessed on domestically produced products, but they "feel like" a tariff because they are assessed on products upon import) and that much of his world view came from this belief. The thing is that his "tariffs charged to the US" number on the chart has a poor relationship with the VAT and is sometimes a lot lower.
I am open to "all of these numbers are fake and he is going based on his vibes about countries". Way too many numbers are 10% for this to be totally real. But I wonder what is going on here.
The numbers are made up. I don't know about the extent to which they were made up by using some nonsense formula vs. made up by just writing numbers down, but I don't think it really matters.
This chart is fascinating. The Falklands will be charged a much higher rate than the UK, but Svalbard will get a lower rate than Norway.
They asked Dan Ariely to gather the data.
Deep cut for those of us who read way too many substacks and actually read some of these wonky books.
Gotta say, I was at least partially taken in like Obama was. I think I wanted to believe there was “one weird trick” to getting people to wash their hands more or get people to save more for retirement.
The thing is, I still think “people are predictably irrational” is substantially correct (see my comment above about traders/hedge fund managers irrationally believing Trump was bluffing about tariffs). Think behavioral economics has a lot to recommend. So it makes it all the more galling to see Ariely made up his data because (as far as I can tell) he’s just that committed to libertarianism.
Mostly agree with this*. Though wanted to ask, what is your theory behind why the markets have actually been up this week. A few theories but wondering if you agree:
- Too many traders still think this is all a bluff despite ample evidence to the contrary. So they are "buying the dip". In addition, the market is increasingly made up of retail investors many of whom are Trump super fans who have drank the Trump Kool-Aid
- There is a base case that Trump will actually just reverse course and pivot away from tariffs. Given this is basically the one policy Trump has any consistent conviction on (see this clip from Oprah decades ago. https://www.youtube.com/shorts/i7z2tUePt8c Also likely one reason he was Democrat back in the day) I have my serious doubts (or doubts he will fully reverse course anyway). Plus, he's surrounded himself with sycophants in a way he didn't last time. However, Trump is also famously fickle and changes his mind all the time. And he cares A LOT about Wall Street thinks about him.
- The tariffs proposed are massive. As you noted, there is a big danger of recession given the massive increase costs if tariffs are implemented. Plus as you note, the wishy washy nature of Trump's "will or won't he" is a big hit to investment given business owners don't really know what to do. But because this tariff is big enough to cause recession it will perversely bring down inflation due to massive job losses and decrease in consumer spending. My case for this is the 10-year has actually climbed down last few months (also consumer spending lately has been completely propped up by top 10-20% of earners if WSJ is to be believed. Given market collapse, the attendant hit to "wealth effect" will slow down consumer spending at the top and bring down inflation (in theory))
- The economic impacts of tariffs won't happen overnight. Precisely because people still think Trump will backtrack, there hasn't been big prices increases quite yet, nor massive layoffs if business owners think Trump will back off. But give it another month or two and we could see a "tipping point" scenario where the bad impacts start happening all at once. So ignore strong job numbers that came out today; probably a "too soon to be impactful" situation.
What say you? Does any of what lay out make sense to you?
* While you're likely right I think would be a massive mistake for Democrats to sit on their hands and just wait for bad economic news to bolster their midterm changes. If nothing else, I do actually think we are the brink of constitutional crisis. There is to me a very danger to this country right now that warrants being more combative on the merits. Plus just purely on politics, if Joe Rogan's recent comments are anything to go by, it seems like swing voters are actually alarmed by stuff like Gestapo like snatching of innocent people off the streets*.
Based on S&P and Nasdaq futures, feel like bullet point 1 seems like the answer here.
The number of people of clinging to the "there are still adults in the room" mindset is depressing. Although that's perhaps why this "Signal" story took off. One it's hilarious and involves social media so perfect mix to get traction. But the other reason is maybe the dawning realization the adults in the room are not actually adults but people way in over their heads. Would have thought a cursory reading of Pete Hesgeth would have convinced enough people this man has no business running DoD, but I continually am astonished at delusional lies people can tell themselves.
Maybe that's the answer. No one, absolutely no one likes to admit they have been conned. Its embarrassing and humiliating. But its also why cons succeed.
I think the market anticipated the tariffs to be much more moderate and targeted to specific countries/sectors. 10% was swirling around, but ended up being the base rate and many more countries were involved for no discernable reason. I think there was also some sentiment that this could be a continued negotiation tactic that would be temporary and removed over the course of the next few months. Now there are more indications that he is very much committed to this "strategy" long term. Israel removing tariffs ahead of the announcement and still be subjected to a 17% penalty is pretty compelling proof that it doesn't really matter what concessions these countries make.
This moment has been kind of clarifying as to the "How could Trump win" conversation. It seems really clear that tons of people internalized the idea that a lot of the warnings about the dangers of Trump was hyperventilating from over zealous libs and never Trumpers.
So as Josh notes, 2016 happens, dire warnings occur, all sorts of lib freakout (including me) occurs, a lot of the worst warnings don't come to pass even though he says and does plenty of crazy stuff so lots of normies conclude that most of the worst stuff is dare I say "fake news".
Think it also kind of speaks highly of various cabinet members and advisors around Trump the first term because it turns out as bad as he was they really were preventing a lot of the worst stuff from happening behind the scenes.
I feel like a north star for me is John Bolton as almost an avatar of too many of his supporters and even maybe swing voters. It seems as though based on the numerous interviews he did on Fox pre 2018 that he totally bought the narrative that all of these warnings about Trump was lib exaggeration and even dare I say, "a witch hunt". And then he gets the White House and discovers it's even worse than Libs and Never Trumpers say it is.
I think to me it speaks to how much of Trump's success is downstream from Fox and right wing media's ability to set the narrative; even if there actual news numbers are low they clearly have an ability to sway public opinion through 2nd and 3rd order effects.
No I didn’t.
That’s fair, I forgot the precise wording, and I apologize! You did call him “broadly a conservative in good standing” and positively contrasted his nomination with RFK’s, which at the time I interpreted to mean that you thought he might do a better job. (I disagreed then and still do, but maybe you didn’t mean that.)
I said, in November, that he was more likely to be confirmed than RFK, because (unlike RFK) he was not ideologically crosswise with any key GOP constituencies. I was wrong as to RFK’s confirmation, but I never assessed that Hegseth was likely to perform well. In fact, I wrote “I don’t think Hegseth is well-qualified at all.” So, you’re disagreeing with something I never said or believed.
There's a reason they're announcing their "Liberation Day" bullshit AFTER the markets close lolz.
I mean fair.
But also, in theory the markets are forward looking. Plus it's very clear leaks very quickly get to enough traders to start moving the market no matter who's President. And this Presidency is almost farcically leaky.
If you're right, this basically to me validates my theory that too many people just don't believe Trump will follow through despite ample evidence to the contrary.
Honestly, I guess we'll see in like 30 minutes.
Trump said repeatedly during the campaign that he planned to impose steep tariffs. Unfortunately voters chose not to listen or didn’t care at the time, or they didn’t understand what tariffs are. It was a failure of the Harris campaign that they didn’t hit Trump hard on that, running ads explaining that the tariffs would raise prices.