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Fri Oct 4, 2019, 11:01 AM

Krugman: Here Comes the Trump Slump

Now the U.S. economy is going through another partial slump. Once again, manufacturing is contracting. Agriculture is also taking a severe hit, as is shipping. Overall output and employment are still growing, but around a fifth of the economy is effectively in recession.

But unlike previous presidents, who were just unlucky to preside over slumps, Trump has done this to himself, largely by choosing to wage a trade war he insisted would be “good, and easy to win.”

The link between the trade war and agriculture’s woes is obvious: America’s farmers are deeply dependent on export markets, China in particular. So they’re hurting badly, despite a huge financial bailoutthat is already more than twice as big as the Obama administration’s auto bailout. (Part of the problem may be that the bailout money is flowing disproportionately to the biggest, richest farms.)
...
The Trumpist trade warriors, it turns out, missed two key points. First, many U.S. manufacturers depend heavily on imported parts and other inputs; the trade war is disrupting their supply chains. Second, Trump’s trade policy isn’t just protectionist, it’s erratic, creating vast uncertainty for businesses both here and abroad. And businesses are responding to that uncertainty by putting plans for investment and job creation on hold.

https://www.nytimes.com/2019/10/03/opinion/trump-economy.html?action=click&module=Opinion&pgtype=Homepage

15 replies, 4119 views

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Response to SunSeeker (Original post)

Fri Oct 4, 2019, 11:11 AM

1. This sucks for our retirement accounts -- especially since my spouse and I are already retired,

but if it helps drive this criminal bastard out of the WH, I'll swallow the medicine happily. I'm just getting extremely risk averse as a result, so no chance my overall retirement account will remain flat via market gains, especially given the substantial losses I've already incurred because of my responses to market volatility thus far during MF45's tenure. Hopefully, things stabilize, become less news dependent and turn around for the better when he's gone.

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Response to KPN (Reply #1)

Fri Oct 4, 2019, 11:20 AM

2. I'm retired too. Yesterday I transferred my 401k funds from stocks to money market accounts.

I can't afford to lose money. October looks like it is going to be a bad month. My 401k money is now sitting in a money market fund only earning 1.8%, but at least I'm not losing money. I can't repeat what I went through in 2007-8, losing 30% of my stock value. It took me 10 years to recover from that. I don't have that kind of time anymore.

Hopefully Shitler will be gone soon and we can return to stability.

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Response to SunSeeker (Reply #2)

Fri Oct 4, 2019, 01:57 PM

13. EXACTLY! I moved out of stocks last spring. 2007-8 took over 40% of what I've worked for all my life

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Response to KPN (Reply #1)

Fri Oct 4, 2019, 12:09 PM

4. Right there with ya!! Survived '08. If it ruins him yet hurts us, we have to consider this is the

Cost of freedom and democracy.

The alternative- if they stay in power they will take every last dime we have

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Response to Thekaspervote (Reply #4)

Fri Oct 4, 2019, 12:17 PM

5. Exactly.

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Response to SunSeeker (Original post)

Fri Oct 4, 2019, 12:00 PM

3. Prices on homes coming down here.

Every day I get emails about price reductions.

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Response to louis-t (Reply #3)

Fri Oct 4, 2019, 12:17 PM

6. Not here in Oregon. The opposite.

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Response to louis-t (Reply #3)

Fri Oct 4, 2019, 12:55 PM

7. Where is "here"?

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Response to SunSeeker (Reply #7)

Fri Oct 4, 2019, 01:30 PM

9. The icon says Michigan!

Metro Detroit.

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Response to louis-t (Reply #9)

Fri Oct 4, 2019, 01:38 PM

11. Icons don't appear on my phone, only on the desktop version of DU. nt

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Response to louis-t (Reply #3)

Fri Oct 4, 2019, 01:17 PM

8. I'm in mass, and realtors are getting nervous...

Haven't really been following where the housing market is, but I see homes in my neighborhood not selling for several months, which is unusual.

Also, one of the realtors just put a paid article in our local town rag sheet saying "Don't Panic - this isn't 2008". Well, that right there tells people "should I be panicking?".

It's kind of like telling a 4 year old to not put peas up their nose. They never thought about it until you said that, so naturally thats what they starting thinking about.

To put an article like that in the local paper is a sign of panic. They must really be seeing the market getting nervous.

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Response to getagrip_already (Reply #8)

Fri Oct 4, 2019, 01:40 PM

12. In CA too. nt

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Response to SunSeeker (Reply #12)

Fri Oct 4, 2019, 02:17 PM

14. Actually I think toddlers put peas up their noses in every state...



But yes, home prices are terribly reflective of overall consumer confidence - which can't be very high when the dump-in-chief changes his direction every hour or so. (Maybe that's the purpose?)

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Response to SunSeeker (Original post)

Fri Oct 4, 2019, 01:32 PM

10. Can't wait til part stockouts

been predicting this for months ... auto parts, electronics, plumbing ... everything is made in China.

THINK people. What do you use yearly, what has a replacement cycle that's due soon?

I laid in a toilet bowl seal, and a washer set. And replaced brake rotors.

It's coming.

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Response to bucolic_frolic (Reply #10)

Fri Oct 4, 2019, 02:18 PM

15. And scotch, wine, parmesan cheese?

Too bad dump doesn't enjoy good food. His pal Rocket Man apparently does.

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