Après le déluge

IF THERE IS ANYTHING AT ALL

As the Trump Impeachment trial begins, other BIG questions also arise which are deeply troublesome.

Apart from the current Middle East fiascos, our national deficits have soared to all-time highs, our international trade strategy is reminiscent of the 1930s cannibalizations, and our income tax reductions in 2017 opened the doors to even more income inequality and unseen heights in financial markets for the favored rich.

The expression ‘dollars and non-sense’ has been around forever, but Trump has given it new meaning and more danger because he is so impervious to knowledge and experience. And, his supreme confidence in his personal judgments is like the   wisdom about how manure stinks, if it is simply left piled up. The trick is to spread wisdom around and like manure it will help things grow.

It almost seems that Trump has taken the debunked playbook from the 1920-30s, either to lay a foundation for his wish for perpetual power, or as a result of his massive incompetence. Whatever the motive, the result is likely to be stagflation – the economic malady that terrorizes the modern global economy because measures to counter it are so few and limited.

Trump may end his presidency without a major economic disaster, if it ends sometime this year.  But, the reckoning awaits, IF we do not get on top of it right away.

Let’s be clear – WE, means you, me and the rest of the world. In the United States, it starts with choosing a President who will best be able to cope with the deluge.  Smart action by that person and their counterparts around the globe could create a pathway back to prosperity. But that’s likely to be a long, painful process, regardless of who is in power.

Therefore, my thoughts become more personal. On the one hand, one wants to preserve personal wealth, and if the economy begins to contract, it’s certain the market will as well.

 But moving out of investments into cash at a risky inflationary moment creates the counter risk of money itself becoming less valuable. That leaves commodities – including gold.

The deluge prospects are real. The antidotes may be illusory. Doing nothing is stupid. Doing too much may be more stupid.

Everyone must find their own answers, but politics and economics have become so intertwined that dealing with them separately is unlikely to work.

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