I have my doubts as well.
Although he drew back from the precipice this time, I don't doubt his willingness to follow through on threats that are enormously damaging to the US, even in the face of reasoned arguments by his staff and supporters.
His combined ignorance and arrogance make him extremely dangerous.
13
Paul Krugman seems to forget Donald is an old man, and all old men have a few common problems: memory loss, forgetful, talking nonsense (more like just making noises or talking to himself), quick to washroom, play golf (other sports will easily sprain your ankle), and make jokes about women...
sad, but true!
3
Well, i always read the Krugman article to know exactly what is NOT true/going to happen. How does this guy, who is almost always wrong, keep his job?
2
"He may be a maniac but he's *our* maniac." But not one major corporation would ever hire him to a position of responsibility.
5
We are a short-term society. And Trump's attention span is less than that. We borrowed money to give more to the already wealthy which increased our debt and interest payments but has to be repaid downstream. We removed regulations on businesses without any concern for long term consequences that will be repaid downstream in the form of worsening health and environmental issues.
But worse than this, we have lost the confidence and faith of our allies. Why would anyone enter into an agreement with this administration knowing that the president will just change his mind if it suites his immediate needs/agenda/whims/campaigning? And of course, then lie about it to boot, and call people school-yard names.
9
Well written article. But I have this penchant to have Trump pay for his behavior. It just seems as if he's gotten away with it for 72 years.
9
I comprehend the simplicity of Trump's position. He is a rich man controlled by other rich men and his own vanity. The rich know they have him. They never panicked and never will as long as they hold power over his wealth and his name. Trump knows it, the rich know it, I know it. Trump wants to be known as a rich guy and a great President, as he called himself recently. His mind is simple, reflexive, and spontaneous, devoid of real intellect. The rich know he can be easily controlled using his own mind. Then again, maybe they lost control of him. Maybe the trade wars are Wall street ideas as well as the tax cuts and tariffs. It's likely.
Trump hasn't been back to NYC in many months. It's a tell.
3
In the October 1962 missile crisis, an American diplomat offered to show de Gaulle of France as evidence secret U-2 photos, but de Gaulle, who was no American lackey, refused to even look at them, instead replying that, "if the President of the United States says that there Russian rockets in Cuba, that's good enough for me!" . . . How times (& Presidents) have changed . . .
4
Trump's Mexican bluff was good for him and his family and friends.
a.) It took Mueller off the front pages.
b.) His family and friends were able to make quick profits on the stock market downturn and quick recovery.
c.) He demonstrated to his Senator supporters that tariffs do work on weaker trading partners.
3
If Trump gets re-elected he will play nuclear blackmail with the world to get his way . A power mad egomaniac with the nuke codes who will test him as he is obviously a Mad King. Tariffs ,pardons and nukes King Donald is drunk with power a narcissists dream come true holding the world hostage to his ego.
2
I think that the Confidence Fairy is working overtime and the markets are delusional. We are headed for a killer financial hangover.
3
Nothingtaco just doesn't do it for me. Nothing-burger south of the border could be a nada naco, or maybe a hueco huevos?
The financial markets are NOT ignoring his threats, but they ARE profiting from them. As soon as he pulls one of his stunts the market falters, and insider short sellers, including Trump's family and friends, make a killing and then it goes back to business as usual.
Until the next time Trump makes a crazy threat and the cycle continues.
4
Even simpler:
This is again Lucy placing the football for Charlie Brown to Kick.
Is anyone looking at the trading activity of Trump and Co. around the market swings his tweets begets?
4
"Trump’s personality is, in effect, already priced in."
This is a double-edged blade. Yes, it is good to learn that markets don't have to freak out every time Trump goes into a Twitter snit. But the countervailing risk is complacency: nothing that Trump does really matters, so maybe we just collect our profits and go along for the ride.
It is good to remember that Trump is just a glittering public act that distracts attention from the real damage being done by his administration below the gaze of the media circus. Institutions critical to the wellbeing of ordinary Americans are being quietly and systematically destroyed on an ongoing basis. In the absence of a vigilant opposition, at some point the damage will become irreversible.
4
Mr Krugman is putting the world on notice that president Trump carries a small stick...Now that is provocation of the nuclear kind with a president who measures his accomplishments in life by the size of his shtick.
The notion that this mercurial president's improv decisions are already priced in by investors for their built in innocuity, should infuriate mr Trump if he ever gets to read this op-ed. Will that cause a retaliatory response that may not be priced in yet?
Let's await the next tweet tsunami and find out.
4
No worries. Trump doesn’t read.
4
Trump's unpredictable, chaotic approach may have appeared successful in his real estate dealings, but it does not serve the United States well in the much more complex arena of international trade with its multi-layered networks of relationships.
This president's bull in a china shop behavior (no offense intended, China!) makes the best case we've seen yet for Congress clawing back all of its powers related to trade with other countries and the judicious application of tariffs.
7
Trump is simply a showman whose ulterior moments range from transparent to utterly unfathomable from moment to moment. One always has to ask he is just bluffing for some anticipated advantage, outright lying (the default because that's usually what's true - at least to some extent), or simply playing Fox News and the Twitter universe for marketing/propaganda purposes. Whatever - we don't take him at face value.
It is hard to keep imagining ourselves as a unified democracy when our leader is so unpredictable, malevolent, and vicious personally and professionally. The president, whoever is he, is a model for up and coming leaders. Our president bodes great danger for the future of America as well as for the present.
The only thing I can think of to heal the breach is to reach out to those of us with strong differences of opinion about everything! We have to find common ground with those folks. We have not been so divided since right before the Civil War and that did not go well. 600,000 people killed. Today, a battle would have much higher casualties.
What is equally dangerous is a country divided cannot stand.
2
I don't call it the Trump Wall st Administration for simplistic political or malicious reasons. It's just the plain truth. The man is doing the bidding of the financial powers that be. From the tax cuts for them to the tariffs on Americans to pay for the deficit they created so the rich won't be taxed again. Trump is Wall st. There's no "Delusion Discount". This is the pillaging of America and Trump is the signer. He's no poor you know. Wall St. is his brotherhood. We are his prey.
"Is America great, or what?"
OK, I admit, that made my day.
2
Krugman is in top form today. Is America great, or what?!
4
Let us understand that Trump support is from all he has accomplished on the behave of his supporters. Each tweet, each insult, each failed policy is proof that he's accomplishing what he promised, that he is succeeding. Television does rot our brains.
American's pay the Tariff Consumption taxes.
American's pay the Tariff Consumption taxes.
American's pay the Tariff Consumption taxes.
American's pay the Tariff Consumption taxes.............
I'm just trying to keep up with Trump.
4
The mistake that most people make in judging Donald Trump is that they judge him using the standards that you would expect a rational president to meet. Donald Trump is actually quite easy to understand and predict. That is, once you realize and accept the fact that he is a PSYCHOPATH. Don't believe me? Google "20 traits of a psychopath." Once you see him for what he is, his actions and words are very consistent with his condition. This man must be lawfully removed from office immediately. Either through the 25th Amendment or through impeachment, indictment and prosecution. Or both. Our world is in peril as long as this mental case is our nation's leader.
2
One thing that has been clear to me from the beginning of trump's regime is that he has no intention of ever leaving the office. As he now admits himself, he is here to stay. That does not make me happy. I love it that everyone blithely talks about how it will soon be over, but, folks, it will never be over until the Big Macs or something else gets the man. Be very, very afraid!
2
I have a simpler explanation: Markets just believe Trump.
Execution of policy in democracy is not easy. During campaign seasons, candidates promise many radical changes, but after the election, the new president becomes more cautious and faces many resistances and cannot keep most of the promises.
Not only the American voters are used to this phenomenon. Many foreign countries including allies know this very well and they take advantage of this weakness of American democratic governance while sacrificing American people's interest for a very long time.
Trump is different. Using tariff as a slapping stick for foreign relations show his genius. Not every president can do this, but he as an outsider can do this and should do this. We have to thank him and the wisdom of American voters to elect him ever after. After Trump, foreign countries might know American people can be angry and do radical things it it is needed. This surely makes America greater than before. We have one more card and it's a joker!
6
@Young
Say what? I totally, absolutely disagree with you. His tariffs are hurting Americans, full stop.
28
@Young I guess you don't recognize the effects of three equal branches of Governments as set forth in our constitution. After the election the President runs into the Congress who actually allocate the budget and resources and make the laws, ratify treaties etc. The new President must negotiate his way through Congress to get things done. When a President does not do this nothing or very little will get done. See Trumps 2 + years and this was in a situation where his party controlled both houses.
Trump wants to be a dictator and this seems to be OK with you. But not with the majority of Americans who did not vote for him or the Republican senate. He is no genius more like a petulant selfish child used to getting his way through temper tantrums. Trumps voters shot themselves in the foot then cut off their noses to spite their faces by voting for him.
43
@Young - Wow -- really ignoring the facts, aren't you?
22
This is where a merchant marine academy education beats the Ivy League seven ways from Sunday. Anyone who has sailed as an officer in the merchant marine recognizes Trump is that loony captain. Not navy Captain Queeg, breaking crazy only when pushed to the breaking point. More like Captain Wolf Larsen crazy: cruel and vindictive but essentially trapped in his ship by his own limitations. A traditional education would lead one to focus on the words, and from them try to project potential outcomes. A typical merchant marine officer, having sailed with at least one crazy captain before, might be inclined to think, "Well, that's what he says, but let's wait and see what he does." It seems to me that's what a good portion of Trump's staff is (and has been) doing. Trying to hoist Trump on his words is a foolish task.
That being said, Trump doesn't have to carry through on all or even most of his threats. All he has to do is carry through on one of them. That gets him the same effect at lower cost: he is crazy but he's not stupid.
2
"Yes, his rage-tweets constantly remind us of his egomania and insecurity."
I say it's something medical. Something irreversible. And accelerating. Kick out the shrinks and summon the diagnosticians. Something is very wrong with this sick old man.
3
KRUGMAN FOR PRESIDENT !!!!!
2
@Al Luongo
No way, I don't want him hurt. You know Trump and his lynch mob. Look what he did to Hillary Clinton. He made some vague public reference to someone possibly shooting. And the feds looked the other way.
Fellow readers. Trump is a Military Police appointed President. He's a predator. We need Krugman's intellect as a guide, not him as a martyr.
2
Krugman said, “the markets are treating Trump as harmless, they shouldn’t but they are learning....
3
Hmmm... Krugman has been predicting a stock market crash every week for 2 years now. Let's see - tariffs on China, Mexico just agreeing to overhaul the immigration system and where is the stock market now...? Trump has done exactly what he promised to do, so why the need to discount his "rants"?
I don;t recall seeing anyone with such a bad economy prognosis record, ever, as PK. Perhaps returning that prize is in order.
2
Can ya show me where this column says any such thing, please?
Do be precise.
Dr. Krugman, your article does not mention the most dangerous act that Trump has committed in the Trade Wars. Putting China's Huawei on the U.S. bad actors list has immediately deprived it of access to its key suppliers. I do not believe this is because of actual security concerns. Rather, it is an attempt to shut-down China's flagship hi-tech company (and may be successful). A similar retaliatory act would be if China told Apple that it could no longer use FoxCon manufacturing. This would immediately shut down Apple.
These are not imaginary threats, but actual policies that have already taken effect. They are extremely dangerous representing real attacks to heart of China's hi-tech industry. With enormous fall-out for most hi-tech suppliers internationally. This is more serious, more aggressive, and more dangerous than Tariff threats.
1
Question about Huawei.
Huawei is integral to the rollout of 5G in the EU. The EU cannot simply "just say no" to Huawei. Do their agreements with Huawei put them - all of Europe - on an export/import restriction list?
The markets treat him as being adequately contained, at least for the time being. We've had plenty of mini-crashes related to his tweeting, and I doubt we've seen the last. Investors are aware that "Legally, Trump faces remarkably few constraints..."
1
Trump thrives on chaos. Unfortunately, our economy does not. I sure hope we don’t learn that the hard way.
5
"for now, investors are effectively treating Trump as crazy but harmless":, yes, but for how long...or will there be a 'rubber-band effect' where the economy out runs its capacitance to absorb all of the body-blows and then everything crashes down? My guess is you can't out run the math, the consequences of so many foolish decisions and behaviors, social and economic
3
"...a new trade agreement with Mexico and Canada — an agreement that was very similar to the existing agreement..."
Very similar, yes, in the way the haircut Mark Zuckerberg got yesterday is very similar to the one he got late last week. Not the USMCA, not NAFTA 2.0, but NAFTA 1.0.0.1.
What's the word "new" doing in there?
1
We all know people who use ALL CAPS. And we know what we think of them. This president is no different.
2
Trump is far from "harmless," Mr. Krugman.
North Korea continues testing nuclear weapons. Iran is stepping up production of uranium stuff.
Midwest farmers are still reeling from the tariff's impact, despite the welfare handout by Trump.
Much more could be added to this list, like his climate=danger pooh-poohing. But why go on. He will keep doing his destruction. Don't be lulled into the myth that he is harmless, investors....
2
I think his constant badgering of Powell and the Fed and Powell's seeming acquiescence thereto in the form of his "underwriting" trump's tariff lunacy is certainly not harmless.
Wouldn't it be ironic that after all those (wrong) predictions by the GOP and their sycophant economists that interest rate cuts and QE would "debase the Dollar" that, in the end, trump's undercutting of the fed's implicit independence actually does?
1
I just want the show to end.
8
But the Trumplicans (TM by Trump International) that I know don’t seemed worried, they love him because he’s sticking it to everyone they hate. They support their TrumPresident. (TM by trump International). They don’t want him to leave the TrumpResdence (TM by Trump International). I just hope the TrumpStupidity (TM by Trump International) penetrates the consciousness of he rest of the electorate.
1
Actually we do know what caused him to back down on the Mexico tariffs: his re-election chances. for the same reason, the republicans in Congress were freaking out, as we saw this was the most they had ever broken with their cult leader. the reason is the tariffs would tank the economy and if our economy tanks, his re- election prospects tank with it.
2
crazy, but hardly harmless. why are Republicans willing to stick with him, inept, dishonest, and embarassing as he is? Trump is mad to stay in office (where he is above the law) to avoid the consequence of his bad behaviors. are all Republicans, especially in Congress, also desparate to hold onto their jobs for similar reasons of self preservation?
2
Yes, it's all very sad. Now suppose you nominate somebody who can, you know, beat him. That means somebody with excellent chances in Pennsylvania and Michigan and very good chances in Wisconsin, Iowa and Arizona. That somebody, Paul, is not Elizabeth Warren, believe it or not.
PS--There'll be a good shot at Texas in 2024, and if that comes off we won't have to count every penny. But now we do. Basic economics.
Mark Burnett took this failing businessman and turned him into a folk hero in The Apprentice. People bought the lie hook, line and sinker. Now, as a result, we have almost half the American population who don't want to let go of the myth and U.S. Government and world leaders who are forced to deal with an illegitimate president who is a bully with the mind of a five-year-old. If we survive Trump, it will probably take decades to undo all the damage he has done and to gain back the respect and trust from our allies. Television is dangerous because too many people buy into its fiction and fall in love with its fake heroes.
2
Burnett (or Dr. Frankenstein, as he is known locally) is not even an American. deport him! lock him in a tent or kennel in the Texas heat. he is a foreign agent sent by the Wjndsors to extract payback for our revolution and the War of 1812. does he even have a green card, or just American Express?
Don jr to his dad: Hey dad, I need to sell some assets on the market and I could really use your help.
Trump: What's that son, how can I help?
Don jr: Can you tweet something crazy about Mexico again? Thanks dad.
5
" the president of the United States is seriously out to lunch."
Yes he is out to lunch and he's dining with his two idiot economist Peter Navarro and the soon to be gone Keven Hassett.
@dccork1
Yep, and they’re buying their lunch with our money.
1
Mr. Krugman writes,
"So was Trump confusing Mexico with China? Did he forget that the China deal he was touting months ago actually fell through? Who knows?
"What’s clear, however, is that on trade policy — his signature issue — the president of the United States is seriously out to lunch. And you might think that this would worry investors."
***
I worry that trump is "out to lunch," figuratively. (Actually, I KNOW that he is that.)
But 'most of all,' I hope he goes to lunch... literally … at least twice-a-day, and eats huge portions of the gourmand's high-cholesterol meals he favors ("fills," as 'legacy-free' college students would call them).
1
Not crazy. Greedy, narcissitic, highly probable that the person who occupies the job of POTUS is a criminal and a traitor, but not crazy. Its all about winning, which in Mr. T's mind is obtaining more money.
1
that's not crazy? remember King Midas?
@Pottree - He isn't crazy. Evil - yep, crazy, no.
This editorial claims that investors have learned the lesson that Trump's threats and promises are empty. It uses the fact that markets are up as testament to that claim. However, I need to point out that the markets are only up now because they went down when he made the Mexico tariff threat. Now that the treat is in the past they can go back to business as usual. The only way we'll know for sure that investors have learned the lesson is if they actually ignore the next threat. We need to keep in mind that Trump's bluster is all for one purpose only: to get attention. As long as we give him that attention, he's "winning".
1
"...investors are effectively treating Trump as crazy but harmless." Sorry, but I don't find that statement comforting. On a daily basis he either lies or forgets. I don't see that as conducive to hiring and retaining qualified people. Carry that thought out further and eventually you see this man essentially running the entire show by himself. He stops being harmless at that point but still crazy.
I think Pelosi was correct when she said he needed a family intervention.
2
Donald Trump lives and works by himself in a carefully constructed reality of his own making, and he says whatever he thinks will feed that reality. But because he is the president, we accept his words at face value. The stock market has begun to understand that much of what he says carries no meaning. So should the rest of us.
1
TJ's gets "pearl tomatoes" part of the year grown in USA and the other part grown in Mexico. They are neatly pakaged in plastic containers. This week when I went to pick some up I had a hard time locating them. These were wrapped in crumpled cardboard with a plastic film cover. The container looked hastily wrapped. The tomatoes were USA type, which gave the impression that somebody was trying to avoid a tomato tariff.
My latest image ,,, the Donald is sitting in his toddler favourite 2-in-1 Sit-to-Stand Activity Center, Spin 'n Play Safari, spinning and toggling various buttons, dials, noisemakers, thus randomly focussing on his momentary interest areas, “. Ooh I like that button!I The results of such touching spinning,,, explain as well as anything else, foreign policy, trade issues, and the like.
1
Trump's tweets and threats are all empty, hollow posturings. So 'the market' is right about that... Trump is a 'nothingburger' when it comes to governing. Except for one thing... that scares me, and should scare 'the market' too.
Trump, at least in theory, has "the button". Recall, the "button" that is 'bigger than Kim Jong-Un's button'. And as long as Trump's ego-driven, idiot thumb is anywhere near 'the button', Trump is a danger to the whole world. If 'the market' can persuade the soldier carrying 'the football' to stay off in another room, and be very difficult to find when Trump gets angry, excited, or especially deranged, then all will be fine just like they expect. But oh, that downside.
One of the very best things about reading Krugman's columns is that they're usually not just informative and on point but pretty amusing and witty in a well written, breezy style. A rare combination from a serious columnist.
3
"We don’t know exactly what caused Trump to back down..."
But we do have a pretty good idea what was going on: he did *not* back down; he was never going to do anything; it was all a game of fake posture with the sole intent of making himself look like a bold winner. That is,
"What the world learned from this climbdown is that Trump’s threats are as empty as his promises."
There you have it. Trump is a serial up-is-down poseur. His game plan is fairly simple. Set up a public narrative where the outcome is in fact the status quo, but by bellowing and "threatening" make himself appear (in the eyes of the ignorant and gullible) to be a bold winner. So much winning, Mr President!
2
None of this should come as a surprise. DJT is much more of a con artist/huckster than a business man. His bully, bluster, and bravado act only goes as far as the donor class allows. Whenever he goes into their pockets they send their R'n Senate stooges to rein the Mad Man in
1
I think great patriot farmers has a five year plan sort of feel to it. Stalin did wipe out a lot of farmers.
1
Krugman and others who discount Deranged Donnie's outrageous behavior is just normalizing his outbursts. Eventually, the Dotard may begin to feel that he needs to escalate his outbursts and even to actually carry through with them. We need to recognize him for what he is - an egotistical con man who is in way over his head and becoming senile. He has made the U.S. the laughing stock of the world and someone not to be trusted. What to do?? Bounce him before the end of his term, which is unlikely. Or defeat him in the 2020 election.
4
Think what the world might have been like had this ignorant loon never become president & dominated the discussion with such totality. We might have had time to make at least small improvements instead of staring at this train wreck of a man who day after day makes the world worse.
4
A T-shirt slogan of note: Putin/Trump; "make Russia great again"
2
Trump is not harmless. He is a great threat to our nation and planet. Anyone else as delusional and dangerous as him would be in jail.
4
politics: last refuge of scoundrels.
1
There is no such thing as a crazy but harmless president.
1
BTW, the double-dealing and outright scamming coming from every corner of this stained WH.
Today fresh headline from a digital print...
Jared Kushner-owned company received $90 million from anonymous foreign sources
https://www.salon.com/2019/06/11/jared-kushner-owned-company-recieved-90-million-from-anonymous-foreign-sources_partner/
Really, it's a Mafia Cartel!!!
All wrapped up in a complete secrecy.
Exile them all to Russia with no love, we have enough problems with plenty of a La Russe oligarchs in this country and all over the world, who poison the fabric of every society...that's why I love Elizabeth Warren & Bernie, I find the issue of income inequality absolutely obscene, detrimental...that's how you eviscerate any democracy.
3
Have no fear. If you ever doubted the .01% are REALLY the ones in charge, when Trump threatens their economic prosperity... he'll soon reverse. He can mess with whatever else he likes but that is off limits. They'll get tax breaks, they'll get their economy. They won't let him overstep in that one space that belongs to them. He's their useful puppet. Nothing more. Don't ever forget who is really in charge behind the scenes. The rest is just noise about social issues and stuff that will never ever affect them or their bottom line.
3
"GREAT PATRIOT FARMERS"
Imperialist Running Dog Donald Trump writers like a Soviet Apparatchik.
He is definitely NOT harmless. He is one of the biggest threats to our democratic form of Government that has ever existed.
I was born in August of 1945 when Truman was still President and WWII was winding down. My Dad was still overseas with the Navy when I was born. I became aware of politics when Eisenhower was President and I have lived through every President since. When Bush Jr. decided to invade Iraq, I began to feel that the Presidency has too much power. And now with a certifiable mental case in the Oval Office, I am convinced that something major must be done.
After we rid ourselves of this poison in the presidency, we must work hard to relieve the office of some of it's unchecked power.... even if it takes a Constitutional Convention to do so. There is no guarantee that another mental case may be elected. And Congress must take action before that ever happens again.
3
@Bodyman I think your point about the president having too much power is spot on.If Trump doesn't destroy the country first, he will at least cause us to rethink how government can malfunction.Maybe it's time for a fix.
1
“Like many Trump tweets, it reads like a clumsy translation from the original Russian (“great patriot farmers”?).”
Thank you, Paul. That’ll continue to provide me with amusement for the rest of the week.
5
There is nothing "empty" about Trump's threats. Just ask the immigrant kids dying along the U.S.-Mexican border. Trump REVELS in their suffering. Cruelty is an aphrodisiac to him. We have a profoundly EVIL man in the Oval Office, and Republicans are cool with that. As long as he signs their regressive legislation and nominates alt-right judges to the federal bench, they would LET him shoot someone on Fifth Avenue and do nothing about it. Power really does corrupt people.
6
Markets are, as we have seen repeatedly, idiots.
1
Donald Trump is a liar, a crook and a scoundrel. But he is THEIR liar, crook and scoundrel.
1
Trump is nothing but a joke and the entire world has woken up to it and stopped taking him seriously.
1
As usual, an excellent column. Trump is a magician and trickster. His tweet, insults, and ignorant assertions divert the attention of the public and the press from his actual policies and actions.
1
" More generally, when you have an attention-seeking president, ignoring his antics could well provoke him into even more extreme behavior. "
Krugman is spot-on, here. On the one hand, pretty much anyone sentient knows by knows by now that Mr Trump just says stuff, and it is a mistake to assume that the things he says have any relationship whatsoever to policy, actions, or the real world. Rather, the relevant sphere of reference is momentary traumas to Mr Trump's fragile ego, no more or less.
But on the other hand, given a President whose fragile ego is his entire, complete, and exclusive frame of reference, ignoring that stuff that Mr Trump just says (a response that is entirely justified in real-world terms) is itself a source of trauma to his fragile ego.
That means, as other comments say, that Mr Trump is far from harmless, even though his many statements have no meaningful empirical content. He is entirely capable of disrupting the world economy or launching a word because he feels traumatized, and that's something well worth fearing.
In a way, you have to admire the Mexican government's willingness to play along with Mr Trump's delusion, knowing full well it all meant nothing: they're making the best of their specific position, and it has turned out OK so far. Darn that American media which insists on _pointing out_ that the Mexican government was obviously coddling Mr Trump's delusions, then!
1
“Like many Trump tweets, it reads like a clumsy translation from the original Russian (“great patriot farmers”?).” Wickedly brilliant satire. Putin’s grin grows ever wider with every clueless, divisive tweet.
2
Hmmm. WaPo says Mexico that agreed to host asylum seekers until their cases are adjudicated. That is a huge step. To say that Trump's tariff threat did not produce a change in Mexican policy is a lie.
https://www.washingtonpost.com/immigration/trump-mexico-immigration-deal-has-additional-measures-not-yet-made-public/2019/06/10/967e4e56-8b8e-11e9-b08e-cfd89bd36d4e_story.html?utm_term=.a9f88c12d2d0
Or, are liberals wrong and the markets right about Trump?
Occam’s Razor suggests the latter.
Mr Krugman might also consider the US brand. It's in tatters.
Trump is the biggest mistake ever made...ever...by anyone. To
consider what he could end up doing is truly frightening.
Trump may be inept but China has been an unaddressed problem. Thank him for identifying a weak demand from China. Meanwhile Mexico is now starting to crack down on illegal immigration. The problem is that threats don’t work all the time. See North Korea for an example of needed carrot and stick approach.
The 25% tariffs on $200 billion of Chinese goods are real and have been in place for some time, yet the stock market continues to thrive. U.S. companies are said to be considering reengineering their supply chains away from China and don't seem that troubled. If China capitulates, agrees to open its markets and stop appropriating intellectual property, is that a bad thing? If they don't agree and U.S, supply chains reorganize and become less dependent on Chinese goods and labor, is that a bad thing? It seems that most of what we are getting from the media is handwringing in the face of a delighted stock market.
Mexico is the third largest consumer of American agricultural products, right behind China and Canada.
It has for years bought about half of all the corn the U.S. exports.
Trump's claim is, as usual, detached from reality.
2
Can we just go ahead and call Trump's fecklessness a "dementia dividend" until a better term comes along?
The term connotes a reliable gap between toxic rants that flow from psychological incontinence and political donors who scream bloody murder after empty promises to blow up the economy.
In practice, tweets about starting new economic wars on unsustainable numbers of new fronts predictably send stocks tumbling. The president finds a way to walk back each "policy" spasm and sends stocks soaring. Each mini boom-and-bust cycle looks like a rally but produces little-to-no long-term gain.
3
One wonders whether the Trump family is profiting from the tweets...by playing the ups and downs of the market. But let’s not mistake the stock market moves with rational actions. Too many investors and nearly all pundits ascribe the ups and downs to specific events external to the exchanges. That’s simply not true. Much, if not most, of the markets are driven by algorithms that automatically buy and sell stocks. Only the ignorant give credit to Trump’s erratic behavior.
1
Trump was known for pumping and dumping back in the 1980s.
2
Maybe the farmers in the US bought Trump's lie about Mexico buying huge amounts of agricultural products so they will vote for him again. Surely they can finally see the con man for what he is, can't they?
4
Trump's "signature issue" is marketing Trump and the Trump Brand.
He thinks all news about him is good news--free advertising. His lies, including lies about lies and successes generate news as well as burnout about his obscenities.
Thus his alliance with Evangelical Christians--see today's NYT on sex and tax abuse by Evangelical churches. Note the comments.
Even the word "evangelical" implies marketing--originally gopdstory marketing but now applies to all kinds of marketing. Marketing is about separating fools from their money or votes. One variation is called "lobbying"--that's about separating politicians from their consciences.
Trump is an evangelist.
MW "Collegiate"
Date:13th century
1 often capitalized : a writer of any of the four Gospels
2 : a person who evangelizes; specifically : a Protestant minister or layman who preaches at special services
3 : an enthusiastic advocate "an evangelist for physical fitness" --or the Trump brand.
3
@Michael Kubara
PS--
Evangelical' is fromGreek "eu-angel"--good messenger.
Christians--borrowing from Hermes/Mercury--moved the wings from hat/head, shoes/feet to shoulders.
But they kept the messenger role--bringer of the gospel = goodnews: Believe/submit and be immortal.
Even medievalists ridiculed angels--How many can fit on a pinhead?
But then there's the "goodnews" itself--the greatest marketing scam of all time.
Christians also stole that from Hermes/Mercury--"god of shopkeepers and merchants, travelers and transporters of goods, and thieves and tricksters" --Britannica.
2
Because his credit (credibility) rating was not worth the risk, US banks stopped lending money. When he unilaterally pulled out of the Iran deal, every country in the world realized he could not be trusted. He has made George W Bush, whose reckless decisions are still causing great harm in the word, seem like a saint. By now, having declared victory for closing the federal government, for threatening to close the border, for causing great financial harm to farmers (patriots!), and, now, for cutting a fake deal on a fake threat, each one on whim, he should have lost the support of all but the small percentage of crackpots who voted for him. By leaps and bounds, he should be the least liked and most unpopular president ever.
And yet, about 40% approve of him. That is astounding. Trump, it seems to me, is not the real problem. The real problem is the 40%. Sadly, that seems insoluble. So long as that number holds, people like Trump and McConnell will feel empowered to continue their destructive ways.
7
The worst lie is not that China and Mexico pay the tariffs, that are actually paid by American consumers. The even worse lie, that is being accepted by many in the media, is that the pain to American consumers and farmers is worth it because in the long-run we will be eventually better off because of the tariffs now. The exact opposite is the case. Tariffs make the country that imposes them poorer as their protected businesses become less efficient and noncompetitive.
Trump's assertions that "trade wars are easy to win" fallacious, but the country that instigates a trade war is always by far the biggest loser. The retaliating nations always have a tremendous advantage over those instigating protectionism. This can be easily seen with the tariffs on steel and aluminum that increase the costs of every product made in the US that uses those metals. Thus, American consumers and producers are already net losers from these ill-advised protectionist tariffs, even before any retaliation. These tariffs increase consumer prices and make products produced in the US less competitive, relative to those manufactured goods made outside the country using steel and aluminum priced at the world market, rather than the propped-up, protected US markets.
A retaliatory tariff was put on US motorcycles by the EU, mostly impacting Harley-Davidson, which will not raise any costs on any EU producers or for anyone in the EU except for buyers of motorcycles.."
https://seekingalpha.com/article/4205253
4
In place of no strategy, coherent or otherwise, Donald Trump appears to be engaging in a real life game of whack-a-mole, where the real life stakes for America are perilously high and no one wins.
For the umpteenth time, how is any Republican member of Congress seriously okay with any of this when Trump's blowing stuff up in Washington only causes destruction, hardship and uncertainty?
4
Trump may be an ignorant madman, but he still has the power to destroy.
5
What part of losing $1 billion over a decade don't we understand?
9
@mattiaw Plenty. Your comment makes clear you do not understand the history of real estate partnership tax law in the 1980's. The law then allowed pass-through entities to pass through all losses that could be then used against other income. It was a very popular technique until Congress abolished it in the late 1980's.
@Once From Rome
If the bottom line shows losses of a billion dollars over a decade, there was precious little income being offset. I think we can assume that it wasn't paper losses and wasn't a brilliant strategy.
4
Equity markets are churning on fomo while the bond market is telling you what the markets really think. Look out below.
8
In economics, Trump is doing his trademark blustering, alpha male, Great Negotiator pantomime. It's what got him elected. For a guy that has lived his professional life as a bankrupt, money grubbing celebrity, he can sure cause a nation to shudder at its foundation.
We need to survive this intact somehow.
7
It's obvious how he manipulates the market...
"On another article a reader commented that Trump is pretty much manipulating the stock market with his shenanigans. I wonder who is buying low and selling high?"
https://www.nytimes.com/2019/04/09/opinion/trump-stock-market-results.html
Trump’s Dangerous Obsession With the Markets
The president is not only reading the markets as a daily measure of his success, he is also shaping policy to keep prices high.
4
As a Canadian with a government waiting for the new NAFTA agreement to be signed, we worry. The amount to negotiating energy that went in to getting it done while dodging your irrational, crazy president was/is exhausting. One false step, one wrong word and we know all too well that tariffs could be slapped back on us in a nanosecond, or worse!
Yesterday, while in a waiting room to see my doctor I overheard a Trump supporter give his version of things to a stunned stranger. The number of conspiracies he spewed out truly surprised me, “it's all controlled by the Hillary Clinton and the fake news media and Trump is the only one who tells the truth through Twitter”. I thought, does a full 42% percent of your population think like this; if so I am truly worried.
Great the stock market is sailing along, but the rest of us still sit here fearing your president's next crazy move.
7
@Holly The majority of us did not vote fr this goon nor do we believe ANYTHING that he says or does. He is a complete disgrace to our beautiful country and for those who are so weak of mind that they can be brainwashed as they are, you can only hope they fade out as well
1
Trump is the clothes without the emperor. A TV president shy one TV reality show. Crazy, but not like a fox--sorry Trumpies. As harmless as any other textbook demagogue and his raging, resentful, unhinged, untethered personality cult. Too many people fall for this too much of the time. Somebody else said that. Thurber not Lincoln. Economics was just what Trump said he was good at. Whoa. It was a lie? He's no better at economics than he is at anything else. He knows only grifting like the Republicans know only the eternal preservation at all costs of white male conservative power and unearned entitlements.
5
It's always stunning that Trump always thinks he outsmarting everyone. Trump believes if they don't speak English they must be dumb. This is where why policies are based on racism always backfire in the end.
5
Ah, yes.
Another Vietnam solution - declare victory and leave the room.
China has to be delirious with joy.
8
"...he tweets loudly but carries a small stick." Indeed.
He's also a needy, lying whiner. "Look at me! Look at me! Why aren't you looking at meeeee?!?"
Trump has shown that if we want sane economic policies that work for everyone, the solution lies neither with him nor with the Republican Party.
4
Trump is selling rugs at 90% off. Come my friends, buy my rugs, very special price for you!
3
By now everyone should have figured out trump.
But for the Republicans it sure has been a time to make hay....
Look what Elaine Chao McConnell has done for the state of Kentucky.....government money-wise....shall we look into
this more carefully?
It always was mystifying to me why his fellow republicans
had such a hard time with a playground bully....
The answer is that this scenario has served these guys well....
turn your eyes to the Senate ....NYTimes, WashPost, Nancy, Chuck and Jerry...Awash in Scandals......Time to look under the hood......I use the word 'hood' advisedly ......
1
What will Donald blunder into next, now that we know the moon is part of Mars?
3
I wouldn’t be too quick to surmise Trump was reacting to input from business leaders or Republican politicians when he reversed course on Mexican import tariffs. He doesn’t seem to care what anyone thinks, except to make it appear he never backs down on anything. Like many of Trump’s delusions, this is a manufactured “victory” he can crow about to his base.
3
This jerk ruined or sold off almost all of his businesses in the past. It will continue.
3
Trump’s counter was a threat to withdraw from Nafta with no replacement. But this would have catastrophic economic effects, leading into an election year. After last week’s climbdown, who believes that he would carry through on that threat?
+++++++++++++++++
I want to believe you Paul. But my democrats are some spineless creatures. They won’t even impeach this criminal because they are so afraid.
2
This is like Trump stock trading games a while back, buying something, using is megaphone to build it up by pretending is going to buy it at a premium and then dumping is position.
He conned people for less than a year with that until people realized he never follows through and rumors that he would are just a con.
May be he is still doing that with a bigger megaphone now, but again its credibility is evaporating.
To me it is still terrifying to have a toddler in charge. There is so much room for miscalculation and a real slow down coming (the fed already hints at cutting interest rates).
2
@Joel Excellent point. What's unnerving is that he conned banks and investors for less than a year and this has been going on for over two years with little effort to stop it. Perhaps Graham and McConnell are getting an insider heads-up before each tantrum tweet. Nice to have people keeping an eye on the country's needs and not their own....
2
@Joel
It's the good old "Trump and dump" routine.
Start a fire, then put it out, garner kudos for Firefighter of the year.
His genius is to suck out the marrow from entire ecosystems on his radar.
Maybe Liz Warren can muzzle this wolf in time to save some vestige of clarity and policy soundness
for our children. If he has 4 more, game over!
1
No, Trump is not harmless. He is extremely harmful. Despite his baseless claim that China is paying the tariffs, it is the American importers and consumers who are paying the tariffs. It is the US economy that is paying the price due to companies' not investing because of the uncertainty and chaos of Trump's policy. The long terms damage to the US reputation is incalculable because it has been revealed that both Democrats and Republicans in Congress are more concerned about political scoring and survival. In short, the US has changed and cannot be trusted.
3
Nothingburger (nothingberder?)
1
In light of the Trump Wall st phenom, I am compelled to appeal to you, Dr. Krugman, about a long held concern I've had; the results of academic teachings in business in our nation has failed to address the basic ideas of decent moral conduct. The goal of profit over civic duty and people has made Capitalism a predatory form of economics. It was once noble and good, a means of gaining prosperity in a growing population. But the new Capitalist's can be characterized as Pirates hiding their booty on islands and in foreign nations following their pillages.
You are in a position of informed leadership and posses the greatest credentials to lead academia to promote the concepts of civic responsibility, patriotism, and moral leadership, that themselves, would earn economy leaders pride from the public now deeply cynical about our economy.
I implore you to write a book that will have a place in and create a curriculum that will become a part of every economic leaders library. We need such a legacy from you, thank you.
4
Tactics are right out of the "Trump the Real Estate Developer" playbook. Threaten your opponent with imminent doom, then extract some concessions and declare victory. This strategy has served him well over the years he was dealing with plumbers, trade suppliers and banks, especially small vendors who were "all in" on Trump projects and either ate his terms (revised once the work was substantially complete) or faced bankruptcy. Sadly, for The Donald, these tactics don't work so well when your opponent is a sovereign nation. China has told him to "buzz off" and Mexico was the beneficiary of the panic of American businesses who correctly realized they were the ones that would suffer if the tariffs were imposed. Such winning!
5
"Some readers may recall that a few months ago China tried to avert trade conflict by promising to buy 10 million tons of U.S. soybeans. The ploy didn’t work, but it was at least feasible: State-owned enterprises make up a large part of the Chinese economy, and Beijing can just order them to buy stuff. Mexico, however, is a market economy, in which the private sector, not the government, decides how much Iowa corn to import."
This is the kind of stuff we get when amateurs with no grounding in economic theory and no sense of how global markets work make the kind of abstract generalizations the variety of which a guy on a barstool at the local pub would make while shouting at a screen playing Fox News. Difference is, he's the president of the United States. What scares me is that we really can't know what the long term effects are going to be after years of this.
6
“MEXICO HAS AGREED TO IMMEDIATELY BEGIN BUYING LARGE QUANTITIES OF AGRICULTURAL PRODUCT FROM OUR GREAT PATRIOT FARMERS!”
This all caps comment underscores how Trump is just winning it - no real plan, shifting goals, unclear objectives. No wonder this man went bankrupt some 5 times.
6
Nobody "got" to Trump and convinced him that the Mexico Tariffs would be bad. He NEVER intended to enact them. This was all grand theater to "prove" that tariffs work. If he did impose them on Mexico, it would show that tariffs do not work. See the gears of "Trump Logic" at work? This is how a psychopath thinks. A not so smart one. The media should stop falling for his third-grade shenanigans. Really. Stop it.
9
Look at this headline: 'Trump says he will raise tariffs if Xi fails to meet him at G20"
The most likely reason for this ridiculous rant: there is already an arranged meeting between Trump & Xi at G20. What Trump tries to manufacture is a cheap "win" when he meet Xi, then he can boast that he forced Xi to reluctantly attend G20. This is just the same ploy he used with the equally absurd Mexico tariff threat. A precooked solution.
The really sad part is all the media outlets help made it news worthy. Applaud the enablers of the pestilence.
5
"What investors want to know instead is the extent to which his character flaws will actually lead to destructive economic policy ... when you have an attention-seeking president, ignoring his antics could well provoke him into even more extreme behavior." Reminds me of the movie "Butch Cassidy And The Sundance Kid". Butch has planted dynamite to blow open the doors of the boxcar where the money is stored. The car blows up all over the landscape, with money and boxcar parts flying everywhere. Sundance: "Sure that was enough dynamite, Butch?"
"Crazy but harmless" - largely how I characterize any column by the erstwhile Mr. Krugman
2
"nothingtaco" -- brilliant wordplay!
This DailyBeast article (also with good wordsmithing) points out how Trump's empty storm and thunder distracts us from the hanky-panky and bad policies pursued by his administration and the Senate. https://www.thedailybeast.com/trump-transforms-washingtons-corruption-supernova-into-a-black-hole?source=articles&via=rss
Journalists, don't be fooled by the smoke screen of tweets!
People, don't be outraged -- instead, get even!
1
I ask again. Anyone in SEC, or other security market auditors looking at who is buying and selling stock options before and after Trumps intentionally stupid tweets which never the less roil the markets and give insiders a chance to make money looking over trumps shoulder as his little fingers send out tweets.
3
How can farmers continue to support this clown?
Look at ANY soybean price chart and note WHO was in office when farmers were last in the "high cotton".
IF I were a farmer in the midwest and claimed I still supported Trump, I'd be embarrassed. You are certainly no businessman farmer.
Look at the charts farmers. ANYONE can see how you are being taken for a ride for acting like Trump's shill.
3
It is deeply disturbing to have a proven and consistent liar living in the White House, pretending to be the president of this country. He has absolutely no negotiating skills as his promises and threats are not believable which is a core requirement at any negotiating table. He keeps spewing off strategic threats that are not believable and they are being ignored more and more. He surely has no idea about the consequences of his threats or promises beyond being attempts to bully or cajole the other side with no results to show beyond his nonsensical declarations.
The age of endarkenment is upon us; cannot wait to see some light and glimpses of a new age of reason emerge.
1
Trump is crazy, yes. But in this particular case, Mexico had a very big problem with migrants crossing the whole country to arrive to the US, many being extorted, kidnapped and killed by organized crime. The mexican government now does not have any option but to stop the flow of migrants. At the end of the day, the result is good for our country.
1
Can we please stop calling this thing an administration and call it what it really is, a regime.
2
Trump's thinking on tariffs might be crazy but, on the other hand, "free trade" as it has been practiced in recent years/decades is not necessarily a self-evident and unadulterated "good" either.
First, it is dominated by globalized super-corporations whose practical clout and sway over governments violates or can even ignore many of the tenets/ideology of classical capitalist economics that we learned in college.
Second, while globalization has the "less developed" world, it has brought about the decline of employment and wages in the "developed world," save for the precarious, lower-paying service sector while abetting the growth of a grotesquely avaricious finance sector.
Third, while the notion of "comparative advantage" makes some sense in a theoretical world economy, the stoking of nonessential "demands" for a myriad of trivial consumer goods has made addressing and meeting the essential needs of millions of people more and more difficult: Gee, I'd like to end homeless, but there's no money and providing for the homeless would mean raising taxes and I might then have to stop buying a new luxury Jaguar every other year.
So the perception that some Trump voters have about the deep problems of globalized "free trade" capitalism are not illusory. It's just that Trump and the GOP have no actual solutions to these grave and growing socio-economic woes, and indeed are not even trying to enact any solutions.
Trump hasn't been back to Manhattan for a long time. That is his origin, his people. The Trump Wall st Administration is deeply protective of their financial origins and goals. The Tax cuts for mostly the wealthy individuals and Corporations, the deep interest in protecting fossil fuels as they sabotage progressive energy, free energy, how they impose crowd sourcing Tariff taxes to offset the deficit they enlarged as they shed the burdens of national responsibility onto the 99%.
I remember how Nixon appealed to the camera to tell Americans he wasn't a crook.
I can't recall Trump ever stating he wasn't a crook.
Follow the oil trail. Learn about oil. Then you will know the world.
1
"But for now, investors are effectively treating Trump as crazy but harmless."
That is one of saddest sentences I think I've read in the New York Times. And when extrapolated, what does say about those who continue to support this man, especially the "spineless Senate?"
2
Why didn't Mueller follow the money?
It would have been over already.
Odd.
3
Mueller was not tasked with following the money but surely he passed on information about illegal financial deals to other prosecutors who could follow the money.
2
Just remember, folks: the bills always come due. With interest.
4
Yet this fellow has the support of 90% of Republicans and the allegiance of almost all Republican politicians. The Republican voters care only about image, and the like the fact that Trump is a bully and can get away with openly lying about Democrats. The Republican politicians care only about being reelected.
This is a symptom of the supremacy of image over achievement in modern America. Democrats are not immune. (See: nonachievers AOC and Sanders.) Obama may have been our last real president.
3
The stock market players who are making the real money are those who trade based on near-term volatility. Playing the Trump-induced volatility has been a sure winner. I be very surprised if he, or those close (but perhaps just far enough away) from him aren't making loads of money.
Is Trump doing this purposely in order to amass a larger fortune? Based on his market manipulation in the eighties and on, and that he won't divest from various assets as POTUS, I'd say it's a very good bet. Nice when you can spin the wheel and "takes" your chances when you've go control over the brakes and the rotation. Heads he wins. Tails, you lose. Suffering sociopaths!
1
Well, I wonder what the market would do should Elizabeth Warren be elected the next president.
@TC
Maybe revert to fair value and stop playing the trump "put"?
1
Trump, the self proclaimed deal maker and negotiator could not have ever gotten a one cent discount from Apple Mary during the depression.
He is scared and befuddled. He is in trouble. He thinks that the Supreme Court can stop impeachment proceedings and everyone knows they cannot do that. He does not read and has never read the Constitution.
I don't care what the House of Representatives do to him, the Southern District of New York will eat his cake.
4
Paul, it's certainly true that markets, whatever they may be, are always perfect...Adam Smith's "Invisible Hand" at work. On the other hand, the most dangerous manager is an unpredictable manager. Until Trump is gone, all predictions are worthless.
2
The man that lost 1.7 billion dollars in a decade and lies constantly should be removed from office. He's no business man and he knows nothing about politics. I'm waiting for another crash like the last gop president created.
4
Boy can this guy (Trump) sell some "wolf cookies"? And not only are the Mexican policymakers buying it, but his base are eating them at any price. I personally can't wait for the day when he's out of office and when his apologist will be posed with the queries as to how they stood by him knowing full well that he was a fraud/the fraud that the former mayor of New York City so proclaimed Trump to be at the Democratic National Convention in 2016?
1
Using economic sanctions is what you use to punish a country, but Trump seems to think he has the right to punish ALL countries, even our allies. He knows how to make enemies but is clueless how to make any friends or even know who they are.
A question for the Trump faithful: Who used to be America's friends, and who are America's friends now?
1
“But for now, investors are effectively treating Trump as crazy but harmless. Is America great, or what?”
More likely the choice would fall into the “or what?, category
Crazy but harmless could be as dangerous as it gets. Investor savvy has proven to be catastrophically wrong — example the 2008 economic collapse.
Trump freelancing and unchecked should never be considered harmless.
Trade War Donald juiced up on tariffs as the ultimate big stick on steroids is unquestionably the number one present threat to America’s Economic National Security.
This is simply the latest Trumped-up crisis. Regardless of its own merits, its primary intent is to distract the public from the various ongoing probes of corruption within and around his administration: - the Russians, Deutsche Bank and 666 Sixth Ave. in New York, the fights over whether McGann, Mueller, or anyone else will testify to Congress, access to his New York state taxes.
The dangerous part is not that he keeps manufacturing crises to distract the public, but that the seriousness and intensity of the crisis and the distraction are ever-growing. This latest one jeopardized cross-border trade. What will the next one jeopardize? Peace in some region of the world? (Trump supports Israeli annexation of the West Bank.) Peace between the US and Russia or China (note a Chinese destroyer's provocative maneuvers in the South China Sea)? Something else?
2
I love the reference to "Patriotic Farmers." Anyone versed in the history of the Russian Revolution, and not the shorthand version from Wikipedia, will see the irony. Trump is employing the chaos of Bolshevik political, social, and economic policies to disrupt the country for his own gain and ego, which mirrors what Lenin did when he and his fellow Bolsheviks took control of Petrograd (now St. Petersburg) in October of 2017. Trump is a perverted capitalist version of Lenin, who was also a coward who wanted total control and adulation. He privately loathed and disdained the very workers and peasants who made up the majority of his party. Trump is no different in that regard, just even more delusional and less intelligent.
6
When the bubble burst these folks will be screaming for taxpayer bailouts
They always do
Because they always get them
Starve em i say!
9
The mental health field has always seemed to confuse the ideas of a person being either crazy or dangerous. We have, until now, thought of Trump as crazy, even with a field of professionals noting their analysis. Now I think that after seeing him conduct himself in the most primal manners, that he is beyond crazy, more dangerous than we guess, simply being limited by law.
2
Basically he is like any other bully who when punched in the face immediately backs off from the conflict and then rationalizes his lack of spine.
2
Trump is our very own Mad King Ludwig II of Bavaria. (Trump Tower more than meets the definition of a garish castle.) I keep wondering how much more destructive must his maniacal whipsawing of public confidence be for the business community to state the obvious. Trump is bad for business.
3
'Is America great, or what?'
What.
1
I wouldn't discount this ugly beast, so supine in his arrogant ignorance, to meddle with our once stable, and delicate, trade agreements, in this globalized economy. He must be stopped...before he jumps over the precipice...and dragging us along. Trust, once lost, may take too long to recover. Why go along with this vulgar bully's 'tramplings' until reason and common sense are beyond repair?
3
Great summation.
Trump is inadvertently doing what he promised to do.
To make America great again.
It takes a great America to ignore- not to over-react-
to the non-stop meanness and stupidity that eructs now
on an almost hourly basis form the White House.
We deserve to congratulate ourselves.
Tim Geithner,Hank Paulson,and Ben Bernanke were interviewed a few months back on CBS This Morning. They were asked if they had concerns about the possible slow down of the economy etc. after they had to deal with the 2008 financial meltdown where..as Geithner said..."we were a few days away from the ATM's not working"! Bernanke said you may train for War but you may not want to necessarily be in combat...as he described the pressure and difficulty of dealing with averting another Great Depression like Crisis in 2008. They were asked directly if they thought Trump's policies on the economy with the tariffs and trade wars was making the economy more resilient ...was that and the rise of Populism concerning? Geithner replied that it was .."GRAVELY CONCERNING!" He stated...NO COUNTRY CAN BE STRONGER THAN IT"S POLITICAL SYSTEM....and...THE POLITICAL SYSTEM IN THE UNITED STATES TODAY....HAS LOST THE CAPACITY TO GOVERN !!! WOW WHAT A STATEMENT! They were also asked..... if another financial crisis were to occur in the US...did they have confidence that the Trump Administration could handle it? They were not optimistic!! JUST GREAT !! When the resident experts have an...educated opinion and previous experience in these matters...maybe ..just maybe we as Americans..should heed their advice!! MAGA?? NO WAY...I can't see it from here !!
3
He's certainly crazy but as far as other people are concerned, not harmless. Crazy people do dumb things, repeatedly.
Look at it another way; the dangerous do-dah is not on a leash, and neither is he muzzled. It would have been more helpful to society if he'd been committed decades ago but alas opportunities lost.
2
Trump is not crazy like a fox. he has no idea what
he is doing and the MSM is trying mightily to make
sense of actions and decisions that make no sense
whatsoever
cut it out. the man is incompetent but at least he
lies all the time
2
“Markets are treating Trump as crazy but harmless...”...well...they’re half right....
Looking at that image only two words come to mind: "Brain hurts."
1
No wonder the market is crashing! Oh, wait....
17
On another article a reader commented that Trump is pretty much manipulating the stock market with his shenanigans. I wonder who is buying low and selling high?
52
@Richard
You are too early. China will crash our markets at the time that fits their plans - and in a way that allows Trump to save face; provided he takes their deal.
22
@Richard
Did you even read the article Richard ?
Seems like Paul was making the argument that the markets are not crashing in spite of Trumps poor economic policy, erratic behavior and temper tantrums.
In the long term these things may have a very negative effect on our economy though - We will see I guess.
89
"nothingburger (nothingtaco?)"
How about sexing-up this quip a tad with a Latina-patina, by changing the cuisine for a better fit, as it were?
ENCHILANADA
“Clumsy translation from the original Russian.”
Brilliant.
I always read your columns, Mr. Krugman, economic illiterate though I am. But this one--my goodness! I laughed aloud. And, as The Reader's Digest proclaimed so many years ago, laughter IS "the best medicine."
If I cannot simply shut my eyes and WISH Mr. Trump gone--
--I can at least LAUGH at his odious and enduring presence.
(1) AT LAST!
Someone has called attention to the absurdity of putting everything in capital letters.
Our President's message (a while back) to the head of Iran. Case in point. The gentleman was doubtless shaking in his boots as he read through this blizzard of capital letters.
No. I don't think he was. As for me, I laughed long and hard. I buried my face in my hands and laughed it out. "Laughing through my tears" you might say.
(2) GREAT PATRIOT FARMERS--translated from "the original Russian." Oh Mr. Krugman! I love it. I really do. Keep 'em coming. The little jabs. That puncture so infallibly the balloons of folly and pomposity that keep drifting our way.
(3) "A very small stick." Was that INTENDED to be as wounding as (I hope) it was?
Our Chief Executive is--um--very SENSITIVE to issues of size. He prefers things to be--uh--BIG. VERY big.
If he should read your column, Mr. Krugman--
--I trust he is WRITHING in pain and mortification.
Myself, I laughed heartily. But then--
--I'm not him. Neither (thank the Lord)--
--are you.
Thanks again.
And what do you know, pay for play continues unabated in this swampiest cabinet in the history of our country. We have to go back around hundred years, to find this level of corruption.
But as they say nothing new under the sun.
One by one his double-dealing entourage falling like a domino under scrutiny of unmatched investigation of our tireless Free Press...thank god for them!!!
Just want to bring your attention to the next swamp character, I' m sure no one will be surprised...
Chao created special path for McConnell’s favored projects
A top Transportation official helped coordinate grant applications by McConnell’s political allies.
https://www.politico.com/story/2019/06/10/mcconnell-elaine-chao-1358068
He took bribes from Russians as well.
NY Times was on this for a while, here it goes, the brilliant expose just a few days ago.
https://www.nytimes.com/2019/06/02/us/politics/elaine-chao-china.html#commentsContainer&permid=100767145:100767145
It was long known that McConnell and his extended family never operated for the benefit of our American Democracy, just the opposite is true. If state of Kentucky reelects this despicable creature, we can say goodbye to any perceivable changes, will be stuck in this vicious vortex for many years to come.
It's also imperative, for some democratic candidates to consider running for senate, instead of sitting on 2% in a big waiting line of contestants.
Senate and McConnell represents the biggest threat for our country and us the people.
1
It is the big money mega donors that pay for the Party, and this is why Trump did a 180 on the tariffs. Simply put, the Republican officeholders may be terrified of Trump, but they answer to the people that pay for the Party, and these donors told their senators to tell Trump "NO", and this is what happened. Just like when Trump first took office and got bogged down with healthcare first leaving the tax cuts waiting on the sidelines. That all changed when the GOP donor class told McConnell and Ryan to stuff the healthcare debate, and get the tax cuts done. Guess what happened.
The donor-investor class is running the show not Trump, or at the very least it appears so, and the past 10 days reinforces that appearance.
1
Oooh a market call! What's your track record like here? Let's go back to 2016 and check......wow look at that!,
Every depression, panic, and "great recession", we have experienced since the civil war came to us under a GOP president. You can check.
That sort of consistency isn't accidental. When you smash the economy those with ready cash pick up the pieces they want for pennies on the dollar.
Here we go again.
3
The markets have certainly done a better job of predicting economic activity than has Mr. Krugman. And yet he continues to be paid to be wrong while ignoring all evidence that he was. On those occasions where the evidence cant be ignored he replies, as in this piece, that he will someday be right, and of course by the laws of cycles he will be. But i so wish he had to put his (wife's) money where his mouth is. I do.
2
"Great patriotic farmers" sounds like something Stalin would say.
4
When you see Trump big threat of tariff war with Mexico, and, at the same time Wall Street going up, and up, and up, to the very end of the week, you know that this dude in the White House is nothing more than a sorry buffoon.
Even the Mexican Stock Exchange was going up to the last day. Obviously the businessmen were not taking seriously this "twiterer."
2
"Is America great or what?"
Yeah, truly exceptional....
"It is a tale Told by an idiot, full of sound and fury,
Signifying nothing." Wm Shakespeare
That line could have been written about this so called president.
There has been a lot of chaos and turnover in this so called administration; a few have said "I quit", but most have been fired. Has anyone of them been fired face to face by
t rump? I think not.
The so called man is a coward, through and through.
He is probably insane as well as stupid and cruel.
And his republican party lets him do whatever he gets it into his little tiny brain to do. Those are people we need to flush out of the sewer he promised to drain.
At least he has given US a clear picture of the dangers that arise when we don't pay attention to our duty to vote.
Let US never again make that mistake.
2
Let's have the whole Macbeth quote: A tale told by an idiot, full of sound and fury, signifying nothing.
1
"Trump’s threats are as empty as his promises."
Paul Krugman must find it agonizing to discuss this idiot and the nonsense that he exudes seriously. Those of us watching our world crumble share his pain.
2
Unfortunately, tariffs are the one button Trump can push without needing the support of Congress or fearing the courts. So now, every problem is a trade problem. So yes, he IS dangerous in that arena.
Diplomacy-wise, Trump has nearly tweeted himself to irrelevance. No one outside the U.S. believes him; the Mexican foreign minister even called his bluff that there was a trade-for-immigration deal. Leaders around the world are either ignoring him (Merkel, et. al.) or playing him (Kim, Putin).
1
If there is a god, Mitch McConnell is destined for a hot life.
The loudest, most belligerent and warlike nation continues with this clown ( giving clowns a bad name ). Because Mitch is party over country. Sick bunch.
1
"But what the world learned from this climbdown is that Trump’s threats are as empty as his promises."
...but nothing is emptier than his head.
3
So this proves the Prussian method classifying talent in their leadership ranks.
Lazy, stupid people are harmless, send them to the front.
Hardworking stupid people are to be pushed aside immediately, they can do a lot of damage.. If Trump was hard working, we would be in trouble
2
That's because markets are apoliltical.
I listened to a radio show yesterday on WCCO in Minneapolis where the on air talent from WCCO had on a 30 year Wall Street veteran who was originally from MN.
The host wanted desperately to say that Trump screwed up the Mexico Tariff deal and the guest was having none of it, saying very patiently that the tariffs were a useful tool to get Mexico to conform to helping with the immigration crisis, which is a crisis..and the markets actually moved positively to this since Canada is 10x more important a trading partner than Mexico..and China was going to use any delay by Mexico to get their trade deal cemented. Thus..the 3D Chess game at play to get what we want.
Then the host wanted to suggest the markets were roiled about the politics of impeachment and the guest said it's all political theater and that Wall Street is more concerned with the Fed and the interest rate changes, which are likely to be reduced.
In the end..the host was flummoxed that the expert from Wall Street wasn't joining in on the TDS rant...and totally unaware of how deranged he's become over the years with an inability to take Trump seriously..but not literally.
While I hope there's a lesson here for the host and everyone involved (Calm Down..the world is not going to end in 12 years..or 2), I have my doubts since the media profits from mass hysteria.
If it bleeds, it leads...
2
When the democrats do nothing about the crises on the US-Mexico border President Trump used the trade to impose the pressure on Mexico’s government. I live in New Mexico state which is directly affected by the large flow of immigrants crossing the border every night. Soon after entering her office our new democratic governor lady removed 300 national guards from the border. The national guards were previously installed by President Trump. Afterwards we watched on the local TV the helpless looking sheriff and his three deputes who lamented about their situation. Whatever was available in largest city of New Mexico Albuquerque was designated to house the immigrants. For example they placed the immigrants in the recreational facilities located around Albuquerque City used for the summer camps. These were the inexpensive summer camps for low income families where the poor kids could spend their summer while their parents work. We have here in New Mexico a shortage of doctors and dentists. Sometimes the wait for the specialist or primary care physician extends to several months. It is really easy for the rich liberals to criticize President and preach about our country’s tradition as cradle for the immigrants. It is worth to mention that in the beginning the USA had had much more restrictive immigration laws. The poor and the lower middle class will pay the price and they will be directly affected by the consequence of uncontrolled immigration and the open country borders.
1
In 1992 John Ralston Saul published Voltaire's Bastards (The Dictatorship of Reason in the West). I might suggest the dictatorship is officially over.
Might I suggest John Ralston Saul's 2014 The Comeback which gives us a more sustainable happier and less reasoned non Western society. We need a fundamental change in how we think and economics needs to go back and change its fundamental underpinnings in a world of incredible productive capacity and insufficient demand. Negative interest seems a reasonable place to start to avoid a complete and total disaster but a Trump in the White House means that some people would rather die than change.
1
Bottom line: the “investor” class doesn’t have America’s best interests in mind. It’s unfortunate that we use the stock market as a barometer of our nation’s wellbeing. Donald Trump is an existential threat to our democracy, planet, and economy. But, so long as the “investor” class gets tax cuts and regulatory “reform,” they’ll vote for him in 2020.
2
The unemployment rate is low, but how many of us work two jobs to make ends meet? Farmers can’t find markets for their crops, gas prices are rising, and we manufacture next to nothing. How long can a nation survive as a service industry state where the rich are those who bet on the misfortune of others? Why bother when someone can make millions eating crab legs online? Will our patriots on the farms wake up to save us? 18 months hoping he doesn’t start a war to try and stay in power.
2
Coming from the so-called "prognosticator" who predicted when Trump was elected that the markets "would never recover," why would anyone give a flying flip what Dr, Krugman thinks about economics? (See Krugman's column, NYT, November 10, 2016 for confirmation of his catastrophic miss.)
On what was the most important economic prediction he ever made, Krugman proved himself grossly incompetent and delusional. He doesn't seem to have learned a thing from his experience since.
As Einstein observed, "the definition of insanity is doing the same thing over and over and expecting a different result." It doesn't take an Einstein to conclude that Krugman, blinded by irrational hate for this president, is as insane as anyone in the current liberal media--and that includes so many these days.
1
The USMCA should have been called the
Terrific
Renegociated
United States
Mexico
Policy
1
The bubble continues to inflate. This one will be worse than 07 or even 99. Hope you like your gruel served cold.
4
Yep, in the showdown between business interests and Trump voters, business interests won (as in the tax cut). But Trump needs those voters to be re-elected and stay out of jail, so he started telling tall tales about what a great deal he got out of Mexico. Wait til the Democrats have settled on a nominee who can spend most of her time exploiting this conflict. Trump is toast and he knows it; that’s why he chose Cucunelli for the immigration job. His only hope is to keep trashing Mexicans for this that and the other. He’s going to have to impose those tariffs eventually, to save himself by pleasing ng those anti-Mexican voters. This is going to be interesting.
1
A con man does cons and surrounds himself with other cons, liars and thieves. Just stop and look at DT's history and it says it all. This has to STOP!
1
I sure hope he doesn't read this or he will just reverse course for spite....
@Kathleen Cox He doesn't read. His advisers might read, but they've learned to never feed him bad news.
1
Trump's craziness is priced in, until it isn't. For now, markets are calm. But markets are not static. New craziness, or advanced craziness, or craziness expanded to a new policy area are all just a matter of time. With Trump the question is "When?", not "If," that happens, markets will respond.
1
Gosh! Reading this column you'd think Trump was nuts. He isn't, is he?
When the crash comes to Wall Street and our economy, one can only hope that it affects Trump's voters the most.
As for why it hasn't occurred yet is for someone on the inside to answer. The king is not only naked, he's transparent. Logic says we should be neck deep in trouble by now. Any day now we should run out of fingers to plug the holes in the dike.
1
As the pop band "The Kinks" once observed, "It's a crazy mixed up world" - the so-called Union of Soviet Socialist Republics has become more or less a fascist state, ruled by a dictator in all but name, and in effect China has gone down the same path. As for the USA, does anyone know what's going on? Will Trump and the Republican pack permit a Democrat to win the next presidential election?
And back in the UK, it looks seriously as if rule by idiots à la Trump has caught on with the Conservative Party. Should Boris Johnson actually manage to become the next Prime Minister, the Mother of Parliaments looks set to become the mother of all disaster areas.
All in all, the Computer Age seems to have given us a brave new world in which Internet manipulation à la Facebook and YouTube hardly seems to worry anybody. Least of all the US President ...
1
More evidence that Mr.Krugman is savage.
And boy, does it feel good to see him perform his disemboweling with style, wit, and depth.
Dogs that bark don´t bite.
"the original Russian" -- good one!
2
Let's remember that, as Jorge Castañeda said, Mexico's ultimate defense is to say YES to everything , but never say WHEN.
As his ploys and modus operandi become more obvious, their novelty and attraction to GOP Senators will turn sour. They are not as spineless, dull-witted, and toady as they appear. Once 3 Senators bail from the upcoming White House train wreck, many more, like the sheep they are, will follow. Believe me, that I can tell you.
By that time crooked Donald will have gone as gray as Biden.
1
Ah yes, methinks he doth capitalize too much.
2
How is that fleet "steaming toward North Korea" doing?, speaking of empty threats.
2
"At this point, evidence that Trump tweets are sound and fury signifying nothing is, in effect, good news. English teachers love you for writing these words. Thank you!!
I suspect that the people running the administration's policy are McConnell and Pence, with Trump as a popular distraction. His antics get attention and approval from the gullible/selfish base; their policies are destroying our democracy and our ability to generate prosperity.
Krugman concludes - "More generally, when you have an attention-seeking president, ignoring his antics could well provoke him into even more extreme behavior." And the impact of his behavior extends far beyond the economic realm. It helps spread the rise of autocrats/dictators in our parroting human nature (e.g. Brazil). If we survive this, mental health tests should be a prerequisite for the presidency. That way we won't be using the word "crazy" to describe who we have in power in the oval office.
3
@1blueheron. “If we survive this” - such liberal drama. And exactly which autocrats do we have now that weren’t in power under Obama?
@Jackson The chief one with his 6 associates in jail and Barr under his spell.
@Jackson
1blueheron gave you the prime example: Jair Bolsonaro in Brazil, the "Brazilian Trump" who has already been hosted at the White House.
Bolsonaro wants to cut down the Amazon rainforest. He may actually do the world more damage than Trump.
1
Agreed. The markets have discounted Trump's insanity for the time being. But the emphasis is on "for the time being."
As the markets continue to be driven by emotion, the bubble will grow to unprecedented proportions, which should benefit the nimble. Eventually the 'perfect storm' of excess speculation, declining earnings, global counter-measures against U.S. economic hegemony, Trump's impeachment and, finally, the prospect of a 'socialist' president to replace him, will cause a run on the Dollar and a depressing period of StagFlation.
The market continues rising despite short term economic 'fixes' that will destroy the U.S. economy long term. Trump doesn't get it. His base doesn't get it. They are sticking to their suicidal beliefs, much in the manner that Hitler continued planning his next attacks on allied forces, just as they were closing in on his bunker.
2
Trump reminds me of the sheriff in the movie "Blazing Saddles" who holds a gun to his head threatening to shoot himself if the bad guys don't give in to his demands.In the movie it was funny.In real life.....not so funny.
4
This more a Thank You note to Mr. Krugman ~ not a comment. Clarity is your middle name and much appreciated in our sick times. Educate.
3
We'll know soon if the Mexico deal works or not...just look at what happens re immigrants, up or the same, then a failure, down more than slightly, then a success. We won't need the likes of Krugman to tell us.
1
“Crazy but harmless” understates the position. It’s “the rest is sham—he’s our guy!”
while I am happy that my little foray intro the stock market, which had been growing slowly but steadily and then lost 5% in the last quarter, is back on track? your last paragraph tells the real story. donnie is still a danger. I think someone in the Whitehouse has finally figured out how to corral his worst instincts for now. however, it must be an exhausting job so I don't look for it to go much further.... whoever this person or these people are? they better be tag teaming or they will snap in the face of this tyrannical child.
@coale johnson. Please remember that Krugman said the stock market would crash two years ago.
The Constitution contains procedures for fixing this problem. Why are we not enacting them? I don't want to wait until two months before the 2020 elections.
1
@Jim K
Yep. Thing is, I'm not at all certain that the whole deal won't crash before then. Not kidding. People are sleep walking. Trump is a walking definition of clinical ("malignant)") narcissistic disorder (untreatable) but people seem to think he has a "character flaw." It's nuts . . . and I'm not at all sure who is worse, DJT or the general populace. 25th amendment makes the most sense but they just don't see it . . . or don't want to see it. Down the slippery slope.
I suppose we can take some solace in the knowledge that the Senate's apathy has its limit in the degree to which Trump's antics actually threaten the economy, or at least that portion of it that matters to big donors. The real risk is that they own't be able to prevent economic disaster the next time. Or, that the Trump effect will do long term structural damage to the economy. The financial markets seem less sensitive to the latter type of risk.
1
actually, "investors" are betting on the free money from the Federal Reserve. More cheap debt to keep the music going for a few more months, perhaps even couple more years? It happened for George W, it could happen for Trump! Tomorrow, INHYNH, party on!
Come on Mr Krugman, you are acting like you have never seen this before. Big tax cut for the rich(est), monumental debt bubble, all sprinkled by war. We are lucky that Trump is too chicken to start a shooting war, he got himself a trade war, which could still turn into a real one, but for now no duck and cover.
With every cycle, this gets more serious and less recoverable. I hate to say this, but Homo Amerikanus richly deserves what is coming to him/her. Stupidity has consequences, even if these consequences will come with a delay, owing to the special advantage US enjoyed after WW2. But once they come, it is going to be a doozie ...
2
What if his instructions from Putin is to blow up the American economy? China's near term outlook is continued trade, though they prefer it to be one sided. But Russia's ruling dictatorship sits fat, dumb, and happy on oil. In the fall debt ceiling negotiations they could order him to do this, take all they can get, while he's still in there, and knowing that McConnell will probably go along. Motivation might be a 1 ruble bet that they can do this.
Better have those impeachment proceedings ready to go on a fast track, or at the least a 2/3 majority on a continuing resolution.
This column is full of acerbic gems such as:
"Like many Trump tweets, it reads like a clumsy translation from the original Russian ('great patriot farmers'?)."
Much of this so-called administration sounds like a clumsy translation from the original Russian.
4
There are many ways in which we all seem to be ignoring Trump's passionate outbursts, not just in regards to economics. The "crying wolf" principle that Paul Krugman points out as our national presidential management plan is even more disturbing when he threatens the citizens of Iran with an unprovoked military or bombing campaign that would have catastrophic consequences. This is real reason I think impeachment against Trump should begin now, and not later. Yes he has broken numerous laws in a clumsy and obvious manner, but the real reason to impeach him is that he is dangerous. He is a threat to the world economy, and to U.S. alliances that have been stable for decades, but his derangement could also have far more devastating consequences if he starts an illegal war. I can't imagine how the People of Iran feel right now. Imagine how we would feel if out the blue another country was openly threatening to lay waste to our nation?
2
Krugman should at least thank Trump for insuring his continuing employment to satisfy the daily dopamine hit required by the anti-Trump crowd.
1
While Mostly Harmless* is great science fiction its frightening POTUS.
*1992 novel by Douglas Adams and the fifth book in the Hitchhiker's Guide to the Galaxy series. It is described on the cover as "The fifth book in the increasingly inaccurately named Hitchhikers Trilogy". -- increasing inaccuracy isn't nearly as bad as pathological lying.
1
This is what passes for good news nowadays. I guess I'll take it.
1
Trump is not harmless, quite the opposite. First, he has debased the office of the Presidency in the eyes of the whole world. For United States citizens, he has engendered disrespect for the office, but to the rest of the world, it has emboldened our adversaries. He's always been in bed with Putin, and he's not on top. That America could elect such a delusional lying narcissist is a tragedy, but I think we can take comfort that someone sane will replace him, hopefully sooner than later. The economy runs independent of any President, but the weakening of our nation morally, might be lasting damage.
1
Last winter the guy on the telephone in NYC was advising on where to put some money, and I took the time to tell him you guys are crazy. Meaning that the market hasn’t tumbled because “you guys” think it doesn’t matter if you are relying on a crazy man.
“But as of right now, markets appear to be betting that he tweets loudly but carries a small stick.”
According to Stormy Daniels this would be true, a very small stick.
3
Another illustration of the perversion that pretends to be a president. This seems to be a merger of two preverted childrens' fairy tails. Trumpty Dumpty and Chicken Little. Not sure how the market 'prices in' this kind of stuff, but it becomes more laughable each time the reality-TV script is played out.
It's taken a while, but the world is learning that Trump is a complete joke. Our reputation has taken a generational hit for electing such a clown, but if we continue to ignore his rants, it appears he's too chicken to actually do anything truly dangerous, which is great!
My hope is that his base starts to get the sad joke. Maybe they won't be so motivated to vote for someone the world laughs at.
1
@Jim Dennis
"I'd rather be Russian than a democrat". Is that the base to which you're referring?
1
@Ray - Even traitors don't like to be laughed at, right?
@JB I would rate this scenario as a virtual certainty. In an administration full of crooks led by a felon it’s an opportunity too good to let pass.
1
You’re delusional, Paul. The age of Trump is here- deregulation and economic nationalism are the order of the day. The markets will adapt even if you don’t.
2
Whatever else you want to say about Mitch McConnell, he is not "spineless." Evil, probably. Corrupt, definitely. Self-dealing, without a doubt. But "spineless" applies only to those who do not personally call him out, each and every day.
3
"The emperor has no clothes."
1
Just imagine where Trump would now be politically if the Senate, as Krugman rightly asserts, was not spineless. McConnell and his clan have enabled this inept amateur act devoid of any ethical standards to continue, dangerously so. Let's hope that 2020 will see this embarrassment yanked off stage.
2
“MEXICO HAS AGREED TO IMMEDIATELY BEGIN BUYING LARGE QUANTITIES OF AGRICULTURAL PRODUCT FROM OUR GREAT PATRIOT FARMERS!”
I thought they were already doing that. The U.S. sold $5.5 billion of grain and feed products to Mexico in 2018, up from $5.2 billion in 2017. Dairy imports were also up, $1.4 billion.
2
It's too bad Trump wasn't around during the financial crisis of 2008. He might have sent a few
“But as of right now, markets appear to be betting that he tweets loudly but carries a small stick.”
We have a totally insane person who is President, and everyone is acting like the naked emperor has the most amazing and wonderful new clothes.
The potential for disaster is all too real.
2
Television shows have a couple of seasons. If they are good maybe a long, multi season run. But the public tires and eventually viewership falls off, then ratings fall and then the cancellation notice goes out. A long run is usually because the show has a hook and delivers...humor, drama, thriller, etc., on a consistent basis and people trust it to keep them entertained. I see Trump as a television show....appealing to some of course and reviled and never watched by others. In the span of the equivalent of two television show seasons his incessant rodomontade, the only reason most people watch, has worn thin. Ratings are falling. Cancellation notices are being prepared. He'll be the last to find out.
I'll take "or what."
I am going to go with "or what" for the time being.
There will be a day of reckoning. Along with trump, we will all suffer. It is just a matter of time. He is doing permanent harm to this country with his dysfunctional bullying and narcissism. The rest of the world can function without the USA and he is painfully teaching it that. We will never regain the stature we once enjoyed on the World Stage, or perhaps the rest of the world has been letting us believe that all along; and trump is just the catalyst that is bursting that bubble.
One has to wonder what would pass for policy if Trumps minders did not take the more ridiculous stuff off his desk.
He wasn't "harmless" to my 401K in December 2018.
This jerk is a human wrecking ball, and the GOP court jesters who are supporting him still are doing nothing but setting themselves up for a very very hard hit in the next election.
Trump wears his suits to his rallies - suits made in Mexico, shirts and ties made in China where he's also obtained at least 40 new "Trump" trademarks since he's been in office - and screams out his racist commentary, while a large group of admirers at thos rallies give him not only a standing ovation but a certain salute that came into vogue in Germany in the mid-1930s.
I hope the NY Times looks into all the violations he committed while he was running his "Taj Mahal" casino. I've read that he filed for bankruptcy to avoid the penalities - of which there were many.
Expose this crook.
1
His rage against the economy basically benefits his portfolio
1
If any of Trump’s “voters” read this ,they will say “so what “ and they will vote for him again.
3
Thank you for the thoughtful article.
Thank you Mr. Krugman... Funny and true. Now I'm looking forward to your tutorial on how to safely grasp a Tasmanian devil with bare hands.
1
Just to let Americans know, in Canada we don’t call it the USMC trade agreement but the CUSM. I’m sure the Mexicans call it the MUSC. However, there are other acronyms to make with these letters ( see for yourself) and that maybe why previous negotiators chose NAFTA.
Only when their own ox is about to be gored did the republicans step up-otherwise the American people can just go........
Do we want a president who rules by threats? A dictator? Will Trump's Mexican/Canadian trade deal (USMCA) ever be legislated? Yes, we want a president who doesn't Tweet when he's not golfing or eating or otherwise busy with his pre-presidential fool's gold life? Donald Trump is crazy and not harmless, Dr. Paul.
Markets are up for the moment. What's up falls down sooner or later. Investors have been on tenter-hooks since Trump's trade wars with Mexico (still ongoing despite Trump's victory Tweets a few days ago in CAPS! ). Our trade-war with China TBD, even tho Xi-Jinping is Donald's great pal, "tremendous, a very special man!" Not to mention Kim Jong-un and how his nose is out of joint after the aborted Hanoi Summit (Trump was all hat no cattle).
Donald Trump has already brought great harm to America. He has divided us unmercifully into warring camps. Worth noting that John Dean (whom we watched when he was President Nixon's young counsel in 1972 during Watergate) said yesterday in his testimony before the House Judiciary Committee that it is "striking and startling that history i s recreating itself and with a vengeance", That Trump's White House is like Richard Nixon's White House.
“Is America great, or what?”
Not just great, but great again! Mission accomplished, you can go home now Donnie.
The best thing about Trump and his cabal is their complete and utter incompetence. Imagine if they were actually able to accomplish everything they wanted? Or able to influence the rest of the world effectively? What a horror show.
My reputable investment adviser cautioned me several years ago not to pay any attention to changes of administration in Washington (true story). I was, and continue to be, worried about Trump et al. We were amused by Charlie Chaplin's antics mocking Hitler, and misled into dismissing him as crazy. While he seems to be propping up the stock market, Trump is eating our institutional seed corn, steadily destroying the environment, health care equity, the value of science, free press, and the rule of law. He is not crazy. He is a demagogue with a talent for distracting entertainment.
1
@stidiver
Good points. I imagine the financial titans playing a game of Monopoly. It's just a game. In their real lives, they have money stashed offshore, a second or third home abroad to move to, children in private schools they bribed to get them into. No worries.
1929-33, 2007-08 all over again.
1
Trump and his ilk may be crazy but are far from harmless. In the macro sense we are all a bit crazy as nations routinely kill others over dubious claims or this or that. But in the US there are way too many people in positions of power whose decisions are based on a shallow appreciation of facts and their actual consequences.
While we watch the clown dance, his minions are using their positions to fill their pockets.
All the while, America's constitution and the rule of law have been rendered impotent. Now the circle is complete -servile, venial white men, have extinguished the brief shining light of an imperfect Democratic Republic slowly improving that it might reach the goal enshrined in the words of the founders. What greatness has wrought, small-minded men destroy
1
The professor should spend more time reporting on his enablers. No king serves for very long with compliant enablers.
There needs to be more expositive reporting on all of the shady dealings and then Trump's filing for bankruptcy to avoid paying fines - like his days when he ran a casino into the ground.
INTO THE GROUND.
THAT is what he is doing to our country.
1
Donald J. Trump is a deeply weird and unpredictable man who is also the president of the United States. He still governs by his insight that if he consistently "wins the day" with hostile tweets and insults and crazy talking head opportunities and nutty initiatives like the Mexican tariff bugaloo, then he will win the next election. But business hates the unpredictable; they can deal with anything as long as they can see it coming from a sufficient distance to deal with it. That isn't happening with Trump. He can turn the world upside down just because he feels like it and then reverse course for no earthly reason ten days later. I would think the many successful business people in the country would find Trump is simply too risky to support in 2020. The one Democrat who the business world would like even less than Trump would probably be Warren, but an election is between two candidates and we only know one of them. Once the Democratic candidate is in place, will we see the business world begin to work against Trump by the thousand weapons they have at their disposal, like investment, layoffs, hiring freezes, pricing, etc?
3
Yes Trump is crazy. But he is not harmless. The Economist calls his tariffs "counterproductive and dangerous" because they can inflict long-term demage not only to our trading partners but to our own economy. "The risk of a clumsy mistake that triggers a financial panic is high," it warns.
312
OUR GREAT PATRIOT FARMERS!” are merely props for trump. Do farmers realize they are being used and abused by trump? Are farmers the new welfare queens? Farmers sure get lots of federal goodies from crop insurance subsidies to outright bribes. Unfortunately, being the props for trump's tariffs will not end well. But farmers generally love trump so they get what they deserve.
Our government is the world's laughing stock. The silence of Rebublicans is proof that our form of governance is not the model of enlightenment that "patriots" so blindly say it is. It was shameful that all this country could muster to honor those who sacrificed everything for us on D-day was cadet bone spur. I used to think we'd recover with better leadership in 2020. Not so sure anymore. All the enablers will still be exerting their toxic corrupt influence into the body politic.
1
Whatever else he might be Trump is still the president of the United States and his words move markets. One of his dominant characteristics is greed. One would probably need to be naive to think that he does not use his position to his own economic advantage with some sort of insider trading.
1
The senate is not spineless, it is complicit. Spineless indicates cowardice, whereas complicity with one of the many crimes Trump may have committed is a felony.
Trump lied about the farm component of the deal and he also lied about whether it's signed.
Unfortunately, those Tweets may not be lies. They may be indications of his increasing delusions. In Trump's mind, these things really happened just like the inauguration and the non welcome in Britain last week.
Trump is seriously neurotic (in my opinion) but permitted to remain in office due to our antiquated processes and complicit senate.
Perhaps most telling is the alliance Trump forged between Putin and Xi. Trump is asking the newly formed, stronger alliance to disarm whereas he was unsuccessful asking them individually to disarm before the alliance.
Trump's grasp on reality is fading.
Krugman writes as though this is a new phenomena. Investors have been shrugging off Trump since the evening he was elected...literally. What we have is total gridlock in Washington which keeps politicians from meddling further into our lives.
The political class is disgusting and Trumps election has removed the veil of corruption that runs deep in our ruling class. Our founders were 100% correct, small government is good government.
Unfortunately, Dr. Krugman, having a crazy person leading the most militarily powerful and financially wealthiest nation on the planet is not harmless to humanity. He is a dangerous, mean spirited man who was placed in a position of power by a rather uninformed and easily misguided electorate in a nation that allows the loser of a popular election to win.
5
How did Trump graduate from Wharton?
Anyone who has taken Econ. 101 has a greater grasp on macroeconomics than he does…
1
@Larry
And ought to be a strong reflection on Warton. Since any applicant to the place would already have 3x the intelligence of Trump, maybe they should reconsider matriculating there.
There are other examples of the repulsive graduates others of these ivy league schools produce.
I'm so disillusioned I can't believe it.
And you know what? Its philanthropy. The schools live off philanthropy - and who accumulates to themselves so much of national wealth that they almost have to do philanthrophy? Their reprehensible graduates!
Philanthrophy is usually couched in terms that make it seem good. Actually there's nothing as anti-democratic as philanthropy. Are we a democracy? Or not?
Trump did not graduate from Wharton School of Business. He just LIES that he did, plus that he was the top of his class. All lies. He “graduated” from the generic UPenn, and the well established suspicion is that his father had to ante up a big donation to penn to secure any diploma at all.
Any analysis that concludes that Blondie is "harmless" is dead wrong on so many levels it defies coherence and objective observation. He just hasn't harmed that particular pundit yet -- but he will. That's a stone certainty. It's what antichrists, in their toxic narcissism and conscienceless cruelty, do.
Wall Street and businesses will be laughing out of the other side of their collective mouths when Donald signs an "executive order" in 2020 abolishing Congress and suspending the Constitution for the perceived "national emergency" of the end of his term in office.
Yes, Trump is THAT crazy.
1
"Like many Trump tweets, it reads like a clumsy translation from the original Russian ('great patriot farmers'?)."
I knew it! Krugman never really believed those russian facebook entries determined our election. But isn't this worse?
"Spineless Senate Republicans" indeed, poor Ronald Reagan must be spinning in his grave over Trump's punny-dictator market manipulations. The GOP book has long said markets dictate the economy. So much for creed.
Bankers eventually catch on to mountebanks who pose as casino moguls and then drain them for a large personal payday while the ship goes down. Trump's been engaged in one long leveraged buyout. He borrows money from Daddy or Deutche Bank, vaccuums up all the liquidity and leaves someone else holding the bag. He's a serial bank robber but gets off scott free every time. Who would have thought that American taxpayers would have to pay a president for secret service lodging. Only Trump could get away with getting paid for someone else (us) paying for his personal security. Thanks for the privilege guy.
I shudder to think of how much damage Trump could do if he were actually competent in addition to being fickle.
1
I notice that the president has been using the words 'patriot' and 'patriotism' more often in his tweets. Whenever I heard those words I can't help but think of Samuel Johnson's remark that patriotism is the last refuge of the scoundrel. Where will the president go when this phony appeal fails?
2
Trump is most definitely not harmless. The only thing keeping him from killing is the reality of our deeply critical noting of how bad he is through the ability to speak out against him. It's freedom of speech afforded to us that is saving lives, here and elsewhere. A case in point is his extortion of Mexico as they knew as we do how dangerous he is as they agreed to occupy their own nation with armed troops against freedom loving unarmed migrants. Trump couldn't do that here legally because of the Posse Comitatus act. Otherwise, migrants would have been in mortal danger here as evidenced by Trumps close excursions to that red line of laws.
Trump is most definitely dangerous. We must keep vigil on his every move. Don't just be concerned about the past, follow his present behavior and try to keep him from any further power grabs. His self adulation over his Mexico success and new vigor towards China should be very concerning to us all and heavily focused on.
He did say something to the effect that he could shoot someone on a street in Manhattan and not get in trouble. Is that an idea of a harmless man? I think not.
The financial markets may be ignoring Trump's threats for now, but the real economy is not. Trump creates chaos; chaos leads to uncertainty; uncertainty leads to hiring and investing decisions postponed. There is ample evidence that manufacturing is slowing. Low oil prices suggest slowly global economic demand. Eventually we have slower economic growth and slower corporate earnings, and this translates into lower equity valuations. Trump is delusional, "crazy" as you put it, and belligerently ignorant to boot, but as president unrestrained by Senate Republicans, his power is anything but harmless.
408
@Joe Smith
The Senate Republicans are beneath contempt.
9
@Joe Smith
"...lower equity values..."
Maybe, maybe not.
Chaotic flow can actually be healthier than laminar flow.
Prevents a damaging stampede that humans are so capable of engaging.
1
"The events of the past few weeks destroyed whatever credibility Donald Trump may still have had on economic policy." So what you're saying Paul is that Trump is now in your league. I recall you predicting a great stock market crash upon Trumps election victory. It's riding up around 26,000 now isn't it?
1
@Kurt Pickard Well, maybe today. Unless you're looking some market other than the rest of us. My retirement account, which I care intensely about these days, has been rising slowly, then crashing quickly, over and over again since Trump took office. I'd like some steady, reliable growth before I have to start living on it. Please?
2
I agree with Mr Krugman than everybody's becoming very numb to Trump's rage tweeting. And that it may pose a threat if he starts getting even more outrageous. But I don't know what you're going to do about it because he's the president and Twitter seem to find him quite attractive by not shutting down his account. So the potential for disaster that Mr Krugman sees may very well just have to happen because nobody's going to stop it at least till 2020. And that's profoundly depressing.
What if he or his advisors actually plan these disruptions, providing insider information to a small group who make huge profits as the stock market fluctuates?
1
The president is squandering enormous market advantages -- basically adherence to the rule-of-law in our trade agreements -- for short term political gain. That he does so by invoking emergency powers immune to Congressional or Judicial oversight further undermines the rule-of-law. Couple that with tariff exceptions and exemptions to businesses with sufficient access in the Commerce Department and you get crony capitalism -- effectively squandering the perception that America offers foreign investors a level playing field.
6
Who is trading on prior knowledge of the Trump rants that temporarily shift the stock market? Could some of the unknown advisors who have his direct line have prior access to his twitter outpourings? Are they colluding? Will this be part of a post-presidential payback scheme?
Just speculating here, but perhaps the white house pronouncements are not random lunacy as they are effective in creating short term market shifts?
6
I kind of thought the whole point of Trump’s threat to impose tariffs wasn’t really aimed at Mexico. It was directed at the Fed, and Chairman Powell. Powell felt that he had to reassure Wall Street that the Fed wouldn’t let Trump tank the economy. Wall Street is only interested in one tool in the box, an interest rate cut. Analysts started to speculate just how big the cuts would be and electronic trading algorithms made everything ok again. Voila.
1
Threats are not leadership. Don't buy the lie, we pay the tariffs.
8
From my vantage point here north of the border I'm perplexed. We have an election coming and the "new" Nafta will be an issue as it still needs to be ratified. How can any government sell a deal that is made with the USA? There is no coherent source of comfort that international agreements have any permanence. I don't blame Mr. Trump, he thrives on chaos, I would expect the trade department, and the GOP to have some responsibility. Maybe too much to ask, but where does that leave USA's trade partners?
2
We live in an age of appearances and no one seems to know this better than Trump. He has mastered the art of increasing the tension in his audience , manipulating it then presenting himself as the solution to the crisis. Il makes for riveting television , and for exciting news cycles but after all the sound and fury in the end all we are being treated to is a reelection campaign . Unlike Campaigns in the past that looked to solutions for real problems , Trump is first creating the problem and pretending to resolve them ...with tweets !
Normally in a sane world his tweets this would be laughable but one in which appearances dominate, a selfi with Putin passes for serious dialogue over Russian interference in our elections and a selfi with a concrete wall is important immigration policy. Should we laugh or cry ? Maybe it is time to stop being self absorbed with surfaces and start asking about substance , something that may be hard to tweet or photograph but which is much more important.
5
Do the sharks of the financial markets need to even guess?
This would include Trump's family and friends.
Where is the SEC while all this Trumpian huffing and puffing is going on?
On Monday, May 20th, (after Sunday night's Trump Mexico tariff tweetstorm) the expiring put options on the S&P 500 gained tens of millions of dollars for those who bought them the previous Friday, literally, for pennies.
Lucky guess? I don't think so.
15
Two things.
First, as to the market not really reacting to Mr. Trump in the way Mr. Krugman would like to see. The market is just telling him and us that, in the long run, the President has limited ability to affect the underlying market. Yes, he can have some control over trade policies, but the really important stuff is relatively unchanged by his actions, good or bad.
Second, as to the Mexico farrago. Yes, Mexico agreed months ago to do what they are, one hopes, going to do now. And that is the point. After months of empty promises, we may now see some actual action on what they claimed they would do. Did the threat of tariffs cause this? One could guess, and mine is yes they did.
3
@mikecody and how will any pf what has happened actually do anything about the invigoration problem? too bad the immigrants don't have money in the stock market.... I am sure they would be soothed by your words. unfortunately for them they are fleeing unimaginable danger and poverty to get one of the last tickets into the promised land. this particular problem has not been dealt with.
5
@mikecody
Are you also willing to guess on whether Mexico's "actual action" will have any real effect in the immediate future?
Mine is 'no.'
The beefing up of their national guard, for instance, will kick in around 2021, according to reports.
So both sides are playing empty showmanship, and trump's border policies are still a failure -- Obama made things better, and trump made them exponentially worse.
2
There is, however, a serious question for the “markets” and that is the question of a second term for Mr. Trump. If Mr. Krugman is right, the market will give the President its full endorsement in 2020, if for no other reason than he is irrelevant. On the other hand, as the election approaches some may consider his continued harassment of the Fed via tweet or packing it with sycophants. They may also be alarmed by his recent attempts to bypass Treasury by empowering Commerce in matters of currency manipulation, thereby opening the door for his politicization of the dollar. In light of the fact that the Fed has quite consciously acquired a third mandate as central banker to the world and the dollar is still the world’s reserve currency, Trump’s mark on economic policy, particularly in a downturn, will be no laughing matter- not even for our complacent markets!
5
Trump seems capable of burning the whole place down if he's at too much personal risk. Look how many times he's tweeted his way to billions in collateral economic damage, or an incremental unraveling of western civilization, just to redirect the popular narrative temporarily.
So far it looks like Republicans in Congress are perfectly happy to collect the kindling.
The signature Trump cocktail (1 part petulance, 2 parts ignorance, 3 parts narcissism, with an orange peel twist) is extraordinarily volatile. Far too many have developed a taste for it: things will not end well.
12
For Trump to claim his leadership, intelligence and decision making is the fissile core powering the US economy is, of course, delusional. There's a great madness upon him which neither fact nor reason can dent - so why bother? He's convinced his tariffs are the weapon of choice in generating national wealth when in fact they reduce the capacity of consumers to generate demand because it is, after all, an added tax and diminishes buying power.
Is it possible for Donald J. Trump to be more wrong? (That's a rhetorical question.) That Wall Street has priced in his tantrums, hollow threats, cavalier pronouncements and outright falsehoods etc. is a sure sign that the market is a living thing and thriving - and not because of him - but in spite of him.
1
Don't be surprised if FOX and the GOP - and its voters - read the market's responses as approval of the President's agenda, not as having the Delusion Discount priced in.
5
"We don’t know exactly what caused Trump to back down ....'
My guess is that it was another one of his periodic brainstorms.
They used to just come and go every couple of days.
But now they just keep coming.
7
Watching Trump is like watching a fly stuck between the closed window and the screen. It makes noise, is annoying to watch, but if youy open the window to get it, the fly may elude your containment attempts and begin flying around the room, harder to capture. So you leave the window down. Because you know if you wait long enough, the window can be reopened and you can grab the no longer moving fly at the bottom of the window sill with a paper towel. No muss. No fuss.
3
Is Mexico paying any tariffs at all?
Sure the industrialists are going to come back to the USA and forgo the Chinese consumer market for the comparatively itsy bitsy market in the USA. Trump thinks that they offshored just to send products back to the USA but that is just sooooooooo not true!!
2
"FROM OUR GREAT PATRIOT FARMERS!" Seems to have a Russian ring to it, no? The Russian headline from decades ago would simply have been changed to 'FROM OUR GREAT COMRADES OF THE REVOLUTION." How easy it is to influence the masses when you use propaganda to pander to their prejudices.
7
Tweeting in all capitals is a sure sign of suffering from Serious Person Syndrome "aka it’s better to have been conventionally wrong than unconventionally right."
Many in this administration suffer from SPS and, thankfully, the markets seem to ignore them all.
(SPS: PK, NYT 28 Aug. 2009)
Trump is a con man at his core. What is the con game here? He tells to his very close friends and relatives in advance what he is going to tweet, accordingly buy and sell the stocks. Notice, the stock market moves up and down with his tweets. If markets think he is crazy but harmless, then he goes real. He needs to do that, otherwise, his tweets will have no market value. There is no inside trading here in a typical sense to charge him, although in effect it is. He has no economic policy for the country but he has one for himself and it is working.
8
The fact that The President was forced to negotiate with a foreign country as opposed to the US Congress over the border crisis says it all.
Krugman rants, but never mentions the US border being overrun by economic migrants from third party countries is all you need to know about Liberal priorities. Mexico responded. Our President did what he had to do, without backing down, and Krugman can’t stand it
2
Yeah? Just watch. Migration will continue unabated. Trump’s threat and unthreat won’t change anything. He didn’t do anything. Watch for him to claim Mexico didn’t follow through.
2
Trump has yet to show he can work with Congress in any meaningful way. His few attempts have all ended poorly due to his disengagement after his emotional response when the people he supposedly is negotiating with do not capitulate to his demands. He pouts and issues threats. He does not know how to negotiate, he only knows how to throw tantrums. Maybe it results in someone backing down and doing what he wants, but frequently he just claims victory by changing the storyline. The biggest result of Trump’s deal making skills is the extreme division we have in our country between those who want to believe in him, and those who can’t wait for his time in the spotlight to end.
2
Trump is government by publicity stunt and that seems to be his business model as well, now that he is more involved with licensing his name than actually running businesses (with some notable exceptions such as his Washington hotel). He has always been less about coherent policy than grabbing headlines and one of the most agonizing parts of reading coverage of Trump is listening to people talk about the headline grabs as part of a "strategy." Sadly, it is not just about publicity, but also the personality driven delusions == e.g. the absurdity of his North Korea statements, where he heroically claimed what fools his predecessors were before walking down exactly the same road and achieving nothing.
But if there is any encouraging message in all the coverage of the Trump administration, from press to books to the Mueller report, it is that it is hard to find people in government who play by his rules. Hence the turnover.
It is also hard to find people who are successful in business or taken seriously as business analysts who can't see through this. In some respects it is wait they are paid to do.
Then again, there were the dot com bubble of the 90's and the Theranos/Elizabeth Holmes fiasco. Clearly even supposedly smart money can get conned. But Trump has been so crazy for so long that it is hard to imagine that anyone who survives on business acumen doesn't recognize Trump as a publicity seeking whiner rather than as a functional President.
2
Trump is an Emperor without clothes.
But he is not harmless since he wields enormous unchecked power in the name of national security and continues to abuse that power in his incoherent and simplistic trade wars.
He creates a chaotic and unstable economic and national security environment which by itself can have troubling and dangerous consequences.
He is not someone you want in a leadership position.
He has made the world more insecure and divisive.
Let's name the real perpetrators: the Republican Party. They are outright refusing to do their jobs in the pursuit of the agenda of their donors. And Republican and conservative voters who sent these despicable group to Congress. Trump is the symptom. Republicans are the cancer.
2
How much agriculture do we buy from Mexico and visa versa?
@Merckx Don't confuse the argument with real facts.
The "or what" should cause fear.
1
The idea that Trump is harmless is what people do when they don`t want to look a terrible reality in the eye . The idea that the most powerful man on Earth is mentally unbalanced is too terrible to entertain . Most people , even his supporters and enablers , agree that Trump is unfit for office . But they prefer to think that is just a lot of noise , rhetoric in other words , and that somehow there are not real consequences to the craziness . That is the delusion .
7
This administration, his enablers in Congress, Fox News, and all the other sycophants tooting their horns loud so he might hear their praise remind me of an early episode of the Twilight Zone, "It's a Good Life". That episode showed a young, distempered boy who, if ignored or told to do something he did not want to do, would envision awful things that became real, terrifying the villagers who did not complement him or think happy thoughts about him. The villagers learned the hard way what happened if they displeased this monster. As our nation begins its celebration of Independence, I know above all else our country is not a village of cowards. We will dispose of this disgrace one way or another.
2
I think the "trade war" with China will be off too as the liar-in-chief climbs down as well after he meets Xi Jinping later this month. He will proclaim victory as he climbs down.
Too many people of sound minds, including Dr. Krugman, have been played by his antics of tweeting nonsense. Even as Dr. Krugman pointed out that the market has stopped paying attention to the crazy man's tweets he is paying attention to it.
Also the main and respected media, including The Times and The Washington Post, have also been played by him. Given, as it is pointed out in this column that the liar-in-chief is always attention-seeking, the best course of action is to ignore his tweets and report only what "policies", as hahazard and transient as they are, are in effect.
Ignore the mad and senile dotard, the name given to him by his now new found love.
2
Trump is not harmless. He is a black hole of destruction. That we have weathered this disaster for so long is a miracle. But our present state of suspended animation will not last and the shock waves of our awakening will hit the Richter scale at 9.0.
And let's not forget just how wrong the investment community can be.
2
A rational, stable president might conclude that issuing these threats is pointless. Trump, on the other hand, seems more inclined to crazy-up the next threat.
1
The significant risks associated w/ a crazy president still exist. But there are huge amounts of capital looking for homes every day. Placing it, for fees of course, is facilitated by pretending that the many Trump Black Swans lurking out there among the more normal tail risks are actually pale gray.
Trump is the man who cried WOLF. Maybe (a fantasy of mine) eventually his supporters might even see through his antics.
Bullying the Mexicans with threats of tariffs no doubt plays well to Trump's base. It's terrible economic policy—and maybe worse foreign policy—but it reinforces Trump's brand of being the tough guy who's not afraid to beat up the weak. His base eats this stuff up—and that's all Trump really cares about.
While the economic disruption caused by uncertainty about tariffs isn't good, I'm much more worried about Trump's policy further damaging the economies and societies of Mexico and the struggling Central American nations. It's tragic for the people of those nations—but I also can't imagine it helps the US to have economically devastated and politically destabilized nations reaching from northern South America to the US's southern border.
405
@617to416 The economic tragedy is also rapidly piling up on someone else: Trump's base. They are so devoted that they will destroy themselves before turning on their great leader, because he delivers what they demand: cruelty to those they despise. So maybe this is a self-correcting game.
46
@617to416 It certainly doesn't help the United States to have a generation of children growing up with emotional and sometimes physical scars from being dragged screaming away from their parents and then held indefinitely in concentration camps. Some of those children ended up having to care for the younger children because nobody else was feeding them or changing their diapers. They won't forget that, and if you want to know why children grow up to be terrorists who hate the United States there you have it.
44
Abundantly clear: Trump bought off the market with a corporate tax break, regulation killing, and the tax cut for the wealthy. Corporation buyback reaction helped to promote a higher market. A deal had been made. Trump inherited a good economy and juiced the market with the tax cut and de-regulation action. The wealth effect: hard to argue with.
Very few people talk about the action to buy off the market, and it will remain under-reported and a non-event.
2
Krugman knows the difference between "investors" and "speculators", but he continues to lump the two together when discussing the goals and objectives of the business class. It is the speculators who have successfully "financialized" much of the economy on behalf of the oligarchs and their enablers who revel in Mr. Trump's antics that appear to keep the markets levitated. Underneath it all, however, is the real economy that runs on investment capital, innovation, productivity improvement, etc. and this economy is scared to death that dumb global politics and hyper-borrowing are going to result in the mother of all financial meltdowns.
257
@Mister Ed
It is not a meltdown it is an economic system not relevant to this time or place. It is an economic system on life support and someone needs to pull the plug.
A little over 100 years ago Mark Twain said you can't throw a stone without breaking a church window. Today the churches are empty but the great old building make for fine restaurants , condos and interesting shopping.
14
@Mister Ed You are right on with your comment, this has been happening for a long, long time, even before Trump took office. Our world class "tech" industry is full of speculators driving up values for things that in the end have very little value to society (Facebook) or are just lipstick on an old line business (Uber). Zero percent interest rates and the fact that the US Government seems to be able to print money at will only make the "financialization" worse. It will be ugly when it all ends.
38
@Mister Ed
Trump can't even go throughout an entire week without a mental meltdown, do you rally expect a bellowing birther who has filed for bankruptcy a half-dozen times to be capable of averting a financial one?
32
This Mexico deal does nothing more than allow Trump to fulfill his ridiculous promise that "Mexico will pay for the wall, one way or another." The key insight here is that Trump would prefer not to resort to a military coup after losing the 2020 election (the USS McCain incident has established that our military will follow his orders, no matter how insane they are). He would rather take credit for an economy that will continue humming along and coast to reelection. But the truth is he doesn't care how much harm he inflicts on American workers, as long as he can keep stoking their hatred of the "other." Win or lose in 2020, Trump doesn't plan on going anywhere. Everyone should sit up and take notice of what Trump said yesterday: "I don't leave." Believe him.
259
@WDG
There may be something to that. After all, according to Trump he "has" the police, the military and... the bikers. (The bikers? I suppose MacArthur's cavalry would be proud.)
24
@WDG - If 2 people march on Washington to protest a coup - they can be managed. If 2 million people march on Washington, there are not enough police or military in this country to stop it. Do you think all police and states will meekly submit to an attempted coup? There are millions of privately owned firearms in the US. Do you think all gun owners are Trump zealots? If Trump shuts down transportation systems, I will walk to DC to protest. I also know that the military oath requires a soldier to "support and defend the Constitution of the United States against all enemies, foreign and domestic". The Constitution requires a peaceful transfer of power every 4 years. Defending the Constitution means defending this peaceful transfer of power. Bottom line is this Republic will not go gently into the night if Trump tries a coup.
36
@WDG
" (the USS McCain incident has established that our military will follow his orders, no matter how insane they are)."
Not true. Fortunately, it appears the military, in this one incident, went with the Constitution, albeit, barely. (After covering the name for several days, it was, apparently, vizable during his speech.)
On the other hand, we no longer have General Mattis as Sec. of Defense to bring the military down to earth. I have no doubt that Mad Dog would have countermanded the orders without hesitation.
19
Have to say as a small investor this is essentially my view and always has been. Trump constantly talks an elephant and brings forth a mouse. It's happened several times already and the Mexico kabuki was just the latest example. I've absolutely no doubt he and officials in his administration were getting a serious ear bending from the Republican leadership and the business lobby. The last thing he needs heading into an election year is a serious trade and markets melt down. He's already had to hand out band aids to the farmers and even his own office of M & B is wanting to delay the Huwaei show down. So yes I'd say the markets are right.
105
@John
You have perfectly described the theater Trump is acting in--Kabuki.
11
@John
"The last thing he needs heading into an election year is a serious trade and market melt down. "
Why do you think so many republican politicians have suddenly had come-to-Jesus moments and are bailing out of politics with the ludicrous claim that they miraculously want to spend more time with their families? They know what's coming for the Far Right, and it won't be pretty. But American voters still need to man-up and do what's crucial to save us from Trump's damage - which will need decades to fix.
12
Trump is playing insider trading card and all the billionaires in his cabinets are prospering more with everyone of his tweets.
Instead of talking about nations problems, it seems that they all talk - which sector to tweet for and then plan ahead to take advantage of the market movement.
3
@P2
Is insider trading an impeachable "high crime or misdemeanor" ?
He has weaponized our economic clout (not a bad thing, Mr. President). He carries a big stick, but HE TALKS LOUDLY (bad thing, Donald). But what is worse (and inexplicable) is that he is taking that stick to everyone simultaneously .. China, Mexico, Canada, Germany, India ....... . (Bad thing, Don). When trying to face down bad guys, it helps to have alliances and build consensus, not the other way around.
98
@AP917 China, Mexico, Canada, Japan, India and Europe amongst many more are not the bad guys. All Donald Trump is saying is that other countries should not be able to have the same standard of living as the USA. I think he is up for a fight he is not going to win against the whole world.
17
@AP917
When you put it this way, it is understandable that he went bankrupt some 5 times - not really a creative thinker - just a hammer and all he sees are nails.
17
@Alkoh But he thinks he can because America has the biggest economy and military. For now.
6
He is trying to manipulate the stock market. It's a pattern. About once a month he says or does something ridiculous that sends the market into a mini-nosedive. Then when it turns out to be a false alarm the markets bounce back. I'm sure some people (Mar-a-lago golf buddies?) are making a killing off this. Hints downwind round the seventh hole. It's probably illegal and warrants some investigating. My hope is that investors, not in the know, are wising up to this. However, if you keep stressing the roller coaster it's going to collapse.
337
@gwr
There is no doubt in my mind that is happening, we need to find a pattern of trump associates and/or hidden investment instruments going long/short in anticipation of a tweet storm.
Does anyone think he would not try to monetize every aspect of the office of president?
63
@gwr
After the third or fourth time he did it, it had become apparent what he was up to... look who he has surrounded himself with, they bought themselves a spot on that gravy train to be whispering distance from his ear.
He’s not in it alone, he lacks the knowledge and self control.
Throughout his life, trump has never abandoned a gimmick or shtick... not only is he too unoriginal, he also doesn’t know when he’s made too many trips to the well... he’s the kinda guy to rob the same store not twice but five times and then be surprised the cops are waiting for him when he shows up again.
That’s how this will play out... he’ll either break something and his cronies will tell him to cool it, or he’ll push it too far and get caught.
Hopefully the latter.
45
@gwr: Absolutely believe this is what is going on also. I hope it is being investigated. The WH is being squatted by a mafia family, every event is suspect.
37
Thank you, Prof Krugman, for a succinct summary of the Trump trade/immigration threat. Nothing wonkish for the average non-Mueller reader.
However, I'm troubled that the NAFTA TREATY is neglected, although it does need real reform and enforcement. Missing phrase here: treaty obligations.
Also, "nothing at all about agriculture," is also troubling. American farmers are patriotic AND heavily dependent on immigrant workers to plant, tend, and harvest their crops--citrus, beans, and other vegetables. They are not all drug dealers and rapists although I realize this probably was not mentioned in the trade talks with Mexican negotiators.
While reading the column, it again makes me not understand how we enabled the President to run all trade deals without Congress. It show how much governing is by routine not laws.
3
I guess Founding Fathers never ever imagined such a despicable group of criminals, the Republican party would ever forsake their duty to country in the pursuit of donors' agendas.
So the Trump strategy is apparently to tax Americans in the form of tariffs on imports until the bad foreigners do what we want. Maybe next time he could just hold his breath until they do what he wants.
30
Not much new. The current occupant of the oval office is term limited and the market (as well as investors) looks at long term trends. The market prices in the volatility and has learned to ignore Trump as much as it can, just hoping Trump does not go completely off the rails.
8
Markets might be OK with these antics, but the rest of us are paying dearly. Our unsustainable train-wreck of a healthcare system continues not to be fixed, and the planet keeps heating up apace, with no solutions on the table. The world is without a "leader of the free world", something it could actually use right now.
70
Interesting (strange ?) the way a leading economist, among others, has switched his field of expertise from economics to psychology. I can't wait until Donald Trump's brain is dissected (after his death) and analyzed by forensic scientists, so that we'll know who wins the psychoanalysis gold medal. I certainly don't know nearly as much about economics as Krugman, but when it comes to psychoanalysis ...
5
Krugman observes the markets don’t take Trump’s threats seriously. What’s psychological about that?
@eclectico: Hardly psychoanalysis if you can base your judgments on past behavior. Trump is a bully and a coward. He inflict pain on those he can and back down from those who fight back. The motivation for his actions is debatable but prediction isn't nearly as hard.
What's more, the people who DO take Trump seriously are concerned with trade only peripherally: The base of the GOP and their leaders in Congress. They are intent on an entirely separate agenda, which seems to consist mainly of passing reactionary social legislation and getting the judges appointed who will uphold its constitutionality. Their unhappiness with the results of bad trade policy will be more than offset by that, and as racist, liberal-baiting xenophobes, they will blame those bad results not on Trump or his administration but on the usual suspects: the Democrats, foreigners and "those people."
33
@trillo
They think the world will come to an end and get them off the hook, after which they will go to heaven. Their only worry is that their deity might condemn them for not following his orders (which were actually invented by their ministers).
1
I'm pretty sure he doesn't read Krugman's column but if he did, I'm pretty sure this would set him off bigly: "But for now, investors are effectively treating Trump as crazy but harmless."
17
The problem is that the more Trump is perceived as crazy but harmless to the Economy, the more likely he is to do something drastic to it.
He backed down on Mexican tariffs (as long as he could have phony claims of a "win") because it was clear enough Republicans in the Senate wouldn't stand for it, including the 2nd in command, John Cornyn and his fellow Texan, Ted Cruz, usually a Trump defender. Rather than openly lose his Senate, Trump opted for the fake "win" combined with the Stalinist-like lie.
But the disruptions with China, Canada, and Europe are very real and, while the market may have "priced them in", he can easily make things far, far worse because Trump only sees whether HE wins or loses, never the big picture .
42
There used to be a saying, “the market climbs a wall of worry”.I haven’t heard anyone say that lately but it seems to be what is happening.There certainly is plenty to worry about as Trump engages in trade wars and disparages the Fed for raising interest rates just a bit.The markets are in dangerous territory if they are treating Trump as crazy but harmless.His relationship with economics over the years has been as tenuous as his relationship to the truth.It is election season again and Trump will brag about the industries he has brought to the US.and how they are hiring.The markets know the numbers and their earnings reports give the bottom line-there is plenty to worry about as industries try to navigate the choppy waters of tariff wars.
23
I spoke to a Trump supporter this morning. He had dropped his kids off at the airport and had marveled that the place was packed; at which point he threw in a gratuitous remark that he didn’t see the economic depression that all the Trump haters claimed would happen if Trump was elected.
It is impossible to have an intelligent discussion about Donald Trump when many people seem to only care about the transactional now and not the inevitable consequences tomorrow. This problem goes way beyond Trump into a world view that prevents meaningful communication. At some point we no longer have common values or speak the same language even as we use the same words.
211
@D. Smith Excellent comment. That airport full of workers, for example, the security people screening you to keep you safe, make minimum wage or little better while the contractors make millions. China trade war fallout works as long as billions of taxpayer dollars go to the soybean farmers that suffer.
28
@D. Smith It really is shocking the way trump supporters will avoid any discussion of politics. I accidentally fell into a "discussion" and it ended with a woman screaming at me at the top of her lungs, jamming all the stuff she was pulling out of her purse back into he purse and running out of the bar we were in. The issue was that It wasn't Obama that killed the mining industry (as the trump supporter envisioned) but that fracking that did. That failed to fit into her narrative of events and that any other explanation was an attack on trump and her, apparently. I thought she was nuts.
19
@D. Smith Yes, I'm sure the airport was packed. When I traveled to the airport during the last 8 year of the Obama Administration the airport was packed, too.
12
the Fed. the Fed recently signaled it will do all it can to mitigate Trumps errors. Wall Street believes the Fed does indeed have enough tricks in their bag to buy enough time for Wall Street to get their money out IF things do go very wrong
13
The only truth common among Trump's true believers is their willingness to suspend disbelief when reality beckons them to do so. Just as in economics, their blind loyalty to Dear Leader Donald is based on a set of assumptions, but in Trump's case those assumptions more often than not disregard reality itself.
The schizophrenic stock market, rising and falling this year like a yoyo, is symbolic of the erratically emotional barometric pressure in this country, which is characteristic of our equally erratic and emotionally unstable president.
The best way to cope with all of the resulting uncertainty is, as Mr. Krugman postulates, to just tune it out. Unfortunately, we only get to change the station once every four years, and there's no telling what harm Trump's self-serving informercials will cause in the interim.
37
In the end, it seems the Fed will lower interest rates. Was this what Trump hoped to achieve with the Mexico tariffs?
8
@Leslie, that’s possible but seems a bit of an intellectual stretch for DJT. On the other hand, I wouldn’t be surprised if he gave some of his pals a heads up on tweets so they can short the market.
16
The markets go up and down as he speaks, and if I had money to bet, and knew how to play, I might be rich.
8
Those that can see the reality of Donald are afraid, not of him, but the 40% of the people who confuse his presentation with strength and daring. Frustrated people who feel powerless and experience themselves controlled and limited by political and social forces, take joy in his unbridled attacks on anyone and everyone.
That Donald's mode of operating is fraught with danger for international relationships and makes corporations have to take into account his willingness to burn things down if he is not sufficiently aggrandized is also evident. His persistent pursuit of drama in which he enacts the "my way or the highway" approach to negotiation fulfills his wishes to be the center of everyone's attention and gratifies the wishes of his followers who can identify with him as children wishing for power identified with comic book heroes.
The other source of anxiety with regard to Donald, is the lack of a coherent democratic party that is hamstrung by its inability to come together. 20+ candidates is not the way to come together. The 60+% of us that can see his problems have no one to go to and barring any irrefutable evidence of illegal activities, the 2020 election is going to be another one in which the extremes will hold against the center and we will be up late waiting to see which way the electoral college plays out.
40
@Zinkler I wish people would wait until after one or two of the primaries to bemoan the plethora of Democratic hopefuls. Some will drop out. Let it happen. The good news is that there is more than enough talent in the leadership race - were these the same people who bemoaned Hillary's almost guaranteed win last time? Too few candidates then. We just don't know what we want. But whoever it is, I will vote for them over Donald
27
Dear @E Campbell,
Maybe the number of candidates is not the right, metric, maybe it is the identity politics in which democrats engage and their inability to come to a core group of shared principles that join them all. Right now, the democrats are a lot like the broader political conflict, reducing their positions to niche issues insisting theirs takes predominance over the election. Elections are won when there is a candidate who sells a vision of a positive future painted in broad strokes. Like Reagan's shining city on the hill, Trump's MAGA, Obama's Hope, and FDR's four freedoms, the democrats need to be less fractious about their differences and more demanding of coherence and practical considerations when running a political campaign.
8
In the time being, investors and the economy are treating Trump's threats as harmless. However, that does not mean that in his erratic and attention hungry character, he will not indeed follow through in all of the above with Mexico.
Trump threatened to close the Government several times until he actually did it. I do not think that harmless is a permanent word when related to Trump. He will eventually hurt the economy.
41
Perhaps this is but another indication of the economic truth that one person, one initiative, one idea however brilliant or misguided, is ineffectual in changing the vast construct we call the "economy."
4
Stocks started Diving May 6th, the day Mr.T tweeted about China-no—Deal, they fell ever since then, last day falling was Mr.T tweeting about Maxico tariffs End of May
I‘d love to believe stock markets ignore Mr.T but they don‘t
Market is rising because no tariffs for México and weak economic number on Friday = higher likelyhood for Mr.T making a Deal with China
As much as I liked your opinion, unfortunately the conclusio (Markets ignore Mr.T as crazy but Not dangerous ) seems to be not true
A
Reader from Austria
11
@Willy completely agree. Maybe some long term investors are riding the waves (we don't even look on the days he is ranting away) but I do know some people who have sold off in the dips he has caused (the one late last year being an especially bad case) and paid the price. They are not gaining back their loss for some time to come
1
I would hate to measure any civilization by its investor class with a collective reptilian brain wired for unbridled greed that's oblivious to the long term peril of obsessive wealth-concentration and nano-instant gratification.
Either they're blinded by greed or they're so cynical about the human prospect, voracious wealth hoarding becomes a herd instinct to stampede in any direction with a whiff of blood from a possible financial killing. Nothing -- no one -- else matters.
They don't care if Trump's harmless or not but why should they? Get while the getting's good -- this is the calm before the dystopian storm and global end times that'll be their cue to flee to distant safe spaces in New Zealand, Ireland, British Columbia, Scandinavia, Switzerland, etc. Always a NetJet ready on the runway.
Trump only affects little people, not the upper case 1%. So let him terrorize and trick the peasants (many who adore him) while the truly filthy rich play out the last few rounds as Trump's Casino America slouches towards bankruptcy both moral and monetary.
The neighbor's high school daughter precociously well versed in business (her dad's an accountant) thinks Trump is like a predatory hedge fund that takes over a thriving company, strips assets, ladens it with massive debts, replaces seasoned managers with hacks, files for bankruptcy and then sells the brand to a brand-marketing outfit like the Trump Co.
She's just 17 and smarter than 40 million adults.
243
@Yuri Asian...While she's at it...maybe your neighbor's 17 year old could also explain to Trump's supporters and Fox Nation...the devastating consequences of having to deal with the growing US Deficit in her.. possibly not so distant future !!
7
@Yuri Asian I belong to an investment club.Many of the investors are Trump supporters.They ARE "blinded by greed" but they haven't done so well,probably because they're not on the inside and actually believe what Trump says.But they still announce at meetings the Trump is a "business genius."They used to cite Boeing as an example but I don't hear that anymore.They've moved on to his next fantasy even though they've lost money.But, amazingly,they will tell me that Obama's tenure was an economic disaster despite the stats.When I pointed this out recently one of them told me candidly..... "but we're on the other side."I guess in their case ,"love really is blind."
9
@Yuri Asian You are absolutely right about the investor class: reptilian brains who will worry about how to save themselves when their own recklessness comes due. The idea that the market is "rational" is a delusion, one wrapped in greed, vanity, instant gratification, and breathtaking selfishness.
2
Sorry Paul but you are wrong about Trumps signature issue. It's not trade. It's fear, manifested as racism and bigotry.
62
"Yes, he’s deeply ignorant about policy. Yes, his rage-tweets constantly remind us of his egomania and insecurity. But we’ve known all that for a while; Trump’s personality is, in effect, already priced in."
Classic Krugman--but the last line stands alone as a referendum on his presidency. It's as if Oz were exposed during the movie, not at the end.
It's astounding how markets are so desperate for a killing that they now have to issue buy orders when the president's behavior doesn't blow up the world.
How long that will last, is anyone guess. The man-child continues to roam the world, trying for targets, and looking to stir up trouble. In a movie, the Donald would be sent off to the movies to get out of his parents' hair.
Does the president have the attention span to focus on something other than himself for two hours?
According to Dr. K. the markets could care less, and continue to party like it's November 2020 and the president was going to be carted out of the White House, one way or the other.
14
@ChristineMcM
The president does have the attention to focus on something else than himself for two hours.
It's himself for three hours (when he is in good shape).
I agree with my compatriot here that Australia is not looking good with some our wincingly awful low rent politicians but what takes me aback most about the US, which I much enjoy visiting otherwise, is the amount of power that has been vested in a single person. The reverence with which so many Americans refer to their presidents feels like hankering still after royalty - complete with divine rights. Donald Trump increasingly reminds me of King George 111 sometimes described to British children as "the mad king who lost America."
43
@Fisherose "Donald Trump increasingly reminds me of King George 111, sometimes described to British children as "the mad king who lost America.""
Great phrase, that one in quotes.
It could also apply to King George.
Welcome to the new Age of Diminished Expectations. We now celebrate the complete and total incompetence of our 'leadership'
... however, you know it can get worse so stay tuned.
38
Trump wakes up in the morning boasting to himself or anyone within 30 ft. how great he is and how the sleep he just had was the best the world has ever known, no one could believe how great it was, no one knew it could be so great. The crowd calls out for more, the Trump lovers applaud,. Another day has begun.
Diamond jewelry can be worn to dust by this constant bragging and inflating of language to wrap a royal robe of the fantastic around everything he says or does. We need to discard, disregard, even escape to outer freedom from where this magnetic field of lies asserts its influence over brains which cannot process truth and untruth fast enough to keep up. Instead, we need to look at the main lies that make up the Trump presidency.
The biggest lie? "I never back down." Trump ALWAYS backs down. That's his basic modus operandi. Make a lot of noise. Set up a conflict. Withdraw declaring a wonderful victory.
Who hasn't caught on to this repetitive pattern of pretend to fight and switch? Only those who want to imagine a savior in the man who played a successful businessman on TeeVee and boosted the hundreds of millions his father gave him and loaned him into imaginary billions.
Don't let Trump exhaust your sense of outrage. Everything is fake. Everything is fake unless or until it is PROVEN to be otherwise.
Trump says the "secret deal" with Mexico will be revealed in detail when it is appropriate. Oh, the same time his tax returns are made public?
66
@Doug Terry
Thank you for your astute analysis that hones the Trumpian M.O. to the core. It deflates the buffoon balloon and leaves us knowing that what we see and feel is real. We must neither believe him nor be deceived by him.
You’ve given me hope that many of his followers will catch on to the simple and oft-repeated script of his. Though it may have worn us out, this fake president can’t last much longer ... the truth must win the day.
2
@Doug Terry Crazy but harmless is really crazy but dangerous.
2
Dr. K,
"... from the original Russian" is a great line.
Obviously, there are more important aspects of the piece, but I thought the line deserved comment.
38
This statement in Paul’s column scares me the most: “[W]hen you have an attention-seeking president, ignoring his antics could well provoke him into even more extreme behavior.”
I’m not a psychologist, but this is a man who has spent virtually his entire life trying to get people to pay attention to him—his daddy, the media in New York, women (he even bought a beauty pageant so women would have to flatter him), business leaders and politicians. Now that he is president, we see the same behavior but worse, as he demands attention through Twitter, Fox News, his cabinet (who can forget the orchestrated worshipping of Trump at meetings for the cameras?), other populist political leaders around the world and, most of all, his base.
What Paul described is exactly my worst fear—that the insecure Trump, ever more desperate and angry that people are ignoring him (or worse—laughing at him), keeps amping up his rhetoric and actions. (Remember, this is a man who was furious at the suggestion that his hands were small.) What will he do next to prove how important he is? Tariffs on the entire world? Declaring martial law at the border and sending troops into Mexico? Asking the CIA to assassinate his enemies? (Putin and Kim Jung-un do it all the time!) Attacking Iran or North Korea? Starting World War III with China?
With an enabling Attorney General who believes in almost unchecked presidential power, Trump’s psychological problems cannot be laughed at any longer.
43
Mr. Trump's tweets no longer have any meaning or power to persuade. Each of us can only handle so much crazy.
If only the media would stop talking about it as well, and instead focus on the effects of his policies on ordinary Americans. We already know he's crazy. Now show the 46% of the country that voted for him he is harming them directly with his actions.
27
You can't do that here in the States. Trump voters have their own media and ignore any real information outside of it.
1
The recent so called Mexico deal once again proves Trump's deals are always much ado about nothing. After his bluster all deals turn out to be attempts to mountain out of a mole, and often even the mole does not exist. Trump met with Putin in Helsinki and nothing came of it. His two meetings with Kim Jong-Un were too much smoke but no fire; his much touted re-configured NAFTA is nothing but old product with a new label. Trump brand and bluster has lost its aura of being a self-proclaimed super deal-maker. At the end, Trump is nothing but the Wizard of OZ... weakling who roars using amplifiers. By using the same trick too many times Trump has lost his biggest and possibly only asset, the chimera of invincibility.
8
@PK2NYT
If only the Bard were alive to write a play about this Donald creature. Then "the base" would go be entertained and in the mockery of the Donald, they would finally see what a clown they had voted for.
You need to look beyond Trump. Trump is the symptom of a very serious degenerative disease. What does it say about us that he could have ever been elected in the first place, and that, despite his not exactly subtle trail of crazy, he stands a good chance of being re-elected?
28
@Jesse Silver So true. I was depressed after the 2016 election, primarily because it made me realize that we are not the UNITED States of America and that so many people could be deluded by a hate-mongering narcissist into voting out of spite, bigotry, and envy rather than on the basis of reason. Or put another way, vote for the candidate who divides by his rhetoric and subsequent regressive policies than for a candidate who exhorted us to be "stronger together" with policies intended to take the country forward, and not back to an era of coal stoves and racial subjugation.
23
@Ali G.,,,There is definitely something wrong with too many of us...or at least with too many of us who vote! Trump did everything possible to not be elected and yet garnered enough votes that with a boost from the Electoral College he won. What's worse is that after all the hirings,firings,resignations,indictments,convictions,the Access Hollywood Tape, Cohen's Testimony and the Mueller Report etc...there is still Trump support! Fox has an entire Nation of American Voters who in spite of all the negativity surrounding this dysfunctional Presidency...still support and endorse him!! How can this be explained.What does it take to get through to them?? At this point...it may be not only too late...but IMPOSSIBLE !!
1
Sigh,... there's never quite been the disaster of a
donald t. trump becoming president of the United States of America. Every day is a new sadness of having to experience the trauma of what mentally dysfunctional words and deeds might issue forth from the most unfit person to be given the task of controlling himself. That he has been deteriorating before our eyes, ears, and intuitive sense of the minimum level of performance is becoming not only embarrassing to watch but a quiet desperation of having to wait the eternity for when it will be over.
We remember the wind knocked out of us in 2008 as all areas of the average citizen's wealth was suddenly gone. A great recession had darkened our future into bleakness on that summer. No one says it, but it's stupid not to fear it happening again. This time may be much worse in other ways. Everyone has an important area of concern that worries them to the bone.
Dr. Krugman's report that the financial investor crowd has totally written off a presidency as irrelevant to the business community is true enough. The donald's words and deeds are ramshackle in essence. No nation is going to count on the United States to live up to its word, plain and simple.
And now we've been told on many disparate sources that Russia and China are joining together in taking full advantage of our vacuous state.
This is as close to complete anarchy that we have ever experienced. I hope it's the last and thst it ends very soon.
18
Trump spent his first two years bristling over the fact he did not have imperial power. He was President of the United States, wasn’t he? So why couldn’t he do whatever he wanted?
But now he’s discovered he really can do whatever he wants. All he has to do is slap the right label on it. Either “national security” or “national emergency” will do, and no one will raise a finger to stop him, no matter how implausible his claim. And now that he’s found his national security/emergency hammer, all the world’s his nail.
That’s why I wouldn’t discount Trump as harmless. The kind of power Trump has now discovered he has goes to one’s head, and his was oversized already. And as 2020 approaches he will be increasingly keen to look powerful to the electorate. Heaven only knows how he will wield that hammer, who will get hurt and what effect it will have on markets.
30
So we look forward to further trumptrums as the basis of US national economic and trade policy. Outstanding.
10
The problem with Trump's "strategy" is that our enemies are in agreement that he/we can no longer be trusted and they can only defend themselves by banding together and doing deals behind our back. Russia is happily meeting with China and North Korea, and China and North Korea are meeting separately. Mexico now is furious, So is Canada, albeit more quietly. They will go on, we will be left behind. Corporate America is adjusting accordingly, small business especially and American workers will be in serious trouble. Once our economy is destroyed our collaborating enemies will divide the spoils. Trump and the Republicans are too dangerous to be tolerated.
18
If your glass is half full it's good to see the left half of the country rooting for free trade. Credit to both President HW Bush (who negotiated it) and President Clinton, who negotiated and passed NAFTA.
IMHO, NAFTA's one of the best bills passed in the last 50 years. It's nice to see it threatened so more can see its value.
2
Harmless, yes, maybe; but if he’s ignored too much, Childe Donald will have to break more things in order to get enough attention to keep him pacified.
So, I guess the tabloid dimension that he fosters may be good for America. The more we acquiesce to him putting his name on the momentum of the Obama/Yellen economy, the more hollowness Democrats have to expose in 2020.
I suspect the best news might be that his chronic cluelessness is increasingly caused by his boredom. A headline tonight reads that Trump is taking on Biden in Iowa “to keep himself interested.” I’ve never lost sight of the fact that Trump in 2016 never believed he’d be awarded the presidency. (After all, he wasn’t winning, right up to the final weeks). So, he’s been winging it all along (not reading briefings, relying on a trade war mantra he formed in the 1980s, blathering nonsense on Twitter from his bedroom, playing golf whenever possible,...)
And building owners around the world are removing his name because it’s bad for business. I think that the swamp thing will give new motif to the theme of going into the sunset with a whimper.
7
What we see is an encroaching rule by oligarchs and corrupt politicians - things look very bad in Australia, but nothing like Bolsinaro et al. What intrigues me is why Trump doesn't try to protect his personal debt. I believe this is not small. Deflation of low wages, insecure jobs, tariffs pushing up prices for low income groups, with more defaults, and so on - these are all recipes for the value of debt to become larger, more burdensome. Banks love this, but why would Trump Inc.? is popularity more to him?
Why this way, if his popularity could flat line?
The problem is that I and most non-Democrats accept the criticisms of Donald Trump but we also realize that the Democrats are even worse. The Dems controlled both chambers of Mississippi's legislature from 1876 to 2006. How did that work out? The progressives control California and it's the poorest state in the republic, and yes, the GINI coefficient is sky-high there, too. Give me the worst Republican over the best Democrat any day.
2
How can you possibly say Democrats are worse? Clinton and Obama both inherited a disaster from Republican presidents yet managed to improve things only to have the next Republican disaster president muck it up agsin with Trump and Republican Congress people as the crown jewels of Republican incompetence. Your state is pretty much a third-work society at the bottom of every socio-economic measure almost since the nation was created. Not to mention, when somebody wants to self-destruct, there is nothing anybody else can do to stop him. In spite of all the blue Democratic federal welfare dollars your state gets, things will not get better as long as your state continues to self- destruct by electing Republicans.
1
@FreddyB
"The progressives control California and it's the poorest state in the republic" Say what?
- California has the highest GDP in the US
(https://www.bea.gov/system/files/2019-04/qgdpstate0519_4.pdf)
- California has the 8th highest median household income
(https://www.usnews.com/news/best-states/slideshows/10-wealthiest-states-in-america?slide=4)
- California has no deficit, and has the 16th highest debt per person
(https://www.usgovernmentdebt.us/us_per_capita_spending.html)
Being a fan of Piketty, I don't put much stock in GINI. But California's GINI coefficient is one of the highest in the US, about the same as for the US as a whole (https://en.wikipedia.org/wiki/List_of_U.S._states_by_Gini_coefficient).
1
@FreddyB
Eschew both machines.
1
Laugh or cry, it seems the momentum of economic progress has discounted the rolling Trumpster fire. I too often wonder what dark forces profit from the apparently irrational ups and downs of the market caused by the raging commander in thief. Perhaps like most I am learning to look away, love the life I have worked hard to build for myself, and wonder at those still enthralled by the juvenile rants of an untethered egomaniac. I learned long ago that what it means when we admit "We're all in it together" is that a modicum of empathy and compassion is the admission fee to the human race. For those that deny it...well, might as well kick a rock.
10
Crazy (or eccentric) but harmless was a good description for King Ludwig II of Bavaria, whose reign started with losing a war against Prussia. He became more or less a figurehead. Later on, Wilhelm II of Germany was pushed aside once World War I got underway and the government needed actual leadership.
If something like that happens to the US, I don't see Pence serving as a modern-day Mrs. Woodrow Wilson as cabinet chair and supervisor. I suppose the Senate could do a rush impeachment, but given a Mitch McConnell pace and the speed of events, I would count on action being too late. Resignation into the hands of an eager Pence? No.
2
A fairly convincing argument could be made that it might be better for all of us if Trump does actually cause some economic meltdown during one of his bizarre flights of fancy about trade. The advantage would be that finally the President's credibility would totally rubbished which in turn would reduce the chance of him be reelected saving us all alot of grief in the long run.
5
@RHR
I'd be inclined to agree, except that, as someone whose livelihood is likely to adversely impacted by a Trump-induced "economic meltdown", I'd rather pass on taking the risk, thanks.
7
@RHR, we have already passed that mile-marker. Remember Trump's government shutdown. Lives shattered. People died. Billions lost. Global ricochet still trickeling down affecting the poor and powerless.
7
You are assuming that his supporters are making decisions based on evidence.They are not. His supporters are driven by very ugly basic racism and hatred of the other whom they blame for their woes. Trump is a master at manipulating and exploiting that. No matter what Trump does, as long as he keeps them riled up with hatred, he will not lose their support.
1
Paul Krugman mentions that American manufacturers objected to tariffs on Mexican imports because this would increase the production costs of many products with Mexican parts in their supply chain. He should have added that many Republican Senators who are usually quite servile in their attitude toward President Trump and his policies, showed some rare backbone in speaking out against these Mexico tariffs. Part of why Trump folded was that he realized he was isolated with both Democrats and Republicans in Congress against this particular move.
12
Paul, the Federal Reserve is looking to drop interest rates in the next month because of the US-China trade standoff, is this also part of the delusion? The Mexico deal will be reviewed in 90 days and Mexico is open to changing its asylum laws to force Central Americans to apply to Mexico instead of the US if the numbers coming to the US border do not decrease. Is that also a delusion?
There is no question that President Trump plays it fast and loose with the truth but the US President has a lot of power in trade and the markets know it - don't be deluded.
2
Obviously, case Trump offers a never-ending stream of anomalies and plain blunders to be rightfully critical of. But all of it is not said person's responsibility only.
Had the political establishment been more responsive - or responsive at all - to the will of the people who lifted Mr Trump to power, things would look different.
Exactly the same is taking place in Europe right now. The European Union has been exposed to be under the command of people determined to force their agenda on
hundreds of millions of Europeans, no matter what. Again, the will of the people is overruled.
@lakselv Hillary got 3 million more votes than did Trump. Then there was a huge win for the Democrats in the 2018 elections. Trump has very low approval ratings. Trump doesn’t represent the will of the people.
14
@roseberry Ah.. How many millions voted? How many millions voted Mr Trump? And they do not represent the will of the people?
They sure do, to the amount of their share. This is not about party politics.
@roseberry
Ah.. How many millions voted? How many millions did vote Mr Trump? And they do not represent the will of the people?
I think they sure do, to the amount of their share.
Paul Krugman deftly captures the current evolution of thinking in reaction to the antics of President Trump. However, the article doesn't capture the residual damaging capacity of these antics to impede the smooth conduct of international trade & commerce & negotiations to settle international disputes & confrontations.
Take NAFTA/USMCA as an example.
The renegotiation of NAFTA leading to the draft USMCA witnessed months of uncertainty fueled by repeated tweets, offhand remarks & threats by President Trump. Now his ongoing antics such as the recent tariff threats against Mexico place in doubt the ratification of USMCA & any basis for confidence that once ratified, USMCA will be honoured in letter & spirit & not be the subject of non-compliance by the US or an ongoing string of further gratuitous threats or demands made to further the domestic partisan political interests of the moment of your President.
Not only is your President a problem, but the largely passive acceptance by too many Americans of his antics as some game show writ large compounds the problem.
This uncertainty & wilful disregard for the norms of international trade & diplomacy creates great cumulative damage; damage that is experienced most keenly in Canada & Mexico.
33
@bob adamson
You make an important point and correctly draw our attention to the residual damage that remains even after Trump leaves office. His successor will have to spend time and Federal resources to rebuild the confidence and trust that are essential in trade negotiations
8
@RHR
And while Trump's antics are disturbing, even more disturbing is what Mr. Adamson points out: the fact that much of the Republican party and much of the American populace seems tolerant of those antics.
This suggests that the problem is deeper than Trump and that America can no longer be trusted. When Trump is gone, what's to prevent a similar, or even worse, president from emerging? The failure of the American system to check Trump is not reassuring.
4
@bob adamson Paul Krugman repeatedly predicted the economy would crash if 45 got elected and he continued with his false assertions ever since 45 was inagarated Yet, he pays no penalty other than perhaps a bruised ego. It's big one never mind after another.
In the free market if you fail, your gone. But if you' happen to be a member of the media elite, you are rewarded with a lifetime pass to get ithe story wrong over and over while being paid millions.
I stopped following the markets and almost any news on our great economy, and I hate to say this, but since I realized that our great market economy really is “FAKE NEWS.”
The wage/price spiral that economists constantly cite as a leading indicator for future inflation is meaningless, and has been since the 70’s, and the unemployment numbers is an equally a benign statistic. More to the point and the reason for my cynicism is GDP.
I hate GDP, specifically GDP per capita, which is a useless stat that is irrelevant for a vast majority of American households. IDK what the current number is, but I think it’s somewhere around 67K per person, but in my two person household we are not close to that number, which I am guessing is true for at least 60% of American households.
Finally, and probably my most relevant observation, is if everything seems to be going great in the “markets” it is definitely time to start shorting stocks and commodities, which as least as far as commodities are concerned may have already begun.
Welcome to America, the land of only “GOOD NEWS.”
11
I agree. The numbers used to measure the economy seem to be from another era. They were balky tools in the past, and don’t seem to measure the situation on the ground now. For instance: the stock market has little to do with a person’s ability to afford food, rent, or mortgage. It has little to do with that person’s wage growth. Yet the stock market is often the first thing mentioned when discussing the economy.
7
Abstract shooting the breeze is the GDP, unemployment numbers, participation rates, household income, even my own gross annual income. Real numbers for me are daily, weekly and monthly expenses. Interest rates for my cash position and the total monthly number I add to my grandchildren's 409s and my TDAmerica account. As long as one is saving at a respectable rate the rest is second to weather,sports and silly entertainment. Two dozen possible replacements. I am looking for politeness, modesty and something new, borrowed and very blue.
1
Every day there is a fresh attack on one of the pillars of a stable country - the central bank, trade agreements, government employees, law enforcement, congress, judges, media. Then there are the trade wars with EU, Mexico, Iran, Venezuela, China, Canada, ...
How much punches can the country take before the economy wobbles?
Every government is the world does its best to put out fires and create stability. This administration seems to take pride in doing just the opposite!
24
I'm not a psychiatrist but to me it's obvious that Trump is bipolar, clinically paranoid with delusions of grandeur, and clinically narcissistic. So some investors may be writing him off, but God help us if he ever decides to start a war.
30
Bipolar, no. I wouldn't argue with the rest of your diagnosis.
5
@c-c-g what is bipolar ?
What does it mean ?
It is only uneducated American psychology mystique.
It does not mean anything in Freudian terms.
@c-c-g
I'd also suggest Mr.Trump is a 'clinical coward'. He's good at bluster: "Fire and fury, such as the world has never seen before..." worse than Hiroshima? Nagasaki? I wouldn't lose too much sleep over a War. But all the policy changes being made? Those are worrying. Perhaps TV news shows should spout less opinion and do more in depth analysis of all the far-reaching, possibly negative changes effected in departments like the EPA. Educating the public is the need of the hour. No point beating the drum over every silly tweet.
1
Paul, you nailed it. Trump's delusions and incompetence are fully baked into the world's thinking. He's still a menace, but people don't react to his rants like they did a couple of years ago. I no longer fear that our democracy will survive Trump; I worry if our democracy will survive the republican party.
73
@markymark
You are right. I was just wondering about Mitch McConnell and Donald Trump. Given a choice, I think McConnell is the one we should vote out, the more dangerous of the two.
32
@markymark
I am an optimist.
The GOP will mostly vanish and democracy will survive .
I have faith in young Americans voting in droves this anachronistic administration out of office .
13
Not if we do not get rid of the Electoral College. Twice, they have failed to stop incompetent people from reaching the presidency ignoring the will of the majority of voters. The Electoral College is nothing more than an antiquated institution created to give white people's vote more power. Twice we know now that those people do not deserve that power.
3
Trump takes bribes. That is how I read the markets. If an industry is about to take a hit due to Trump insanity, that industry can cut a deal with Jared or Ivanka and avert the (Trump made) crisis.
In other words, Trump is an extortionist. And paying him off is all part of doing business.
37
@McCamy Taylor Yes, much the way the mob worked in NY construction. Paying them off - payments, no show jobs etc - are built into various contracts and are part of any project pricing. Trump was neck deep in the mob, not from a made guy perspective but from I do business with them and know how this works perspective. He’s just taken this to the White House.
18
Like many Trump tweets, it reads like a clumsy translation from the original Russian (“great patriot farmers”?).
It does sound very communist.
At least he didn’t use the word “comrades”.
24
@Grove
Communism, USSR-style communism, is a thing of the past. The threat now is Big Money.
2
It reminds me of those old Soviet social realist paintings of the farmers with sickles and wheat.
1
When you have been wealthy all of your life like Trump, and insulated from harsh reality, and you have vast sums of money that you inherited/stole through fraud, bankruptcy, and money laundering, you can say or do anything you desire with virtually NO consequences whatsoever. Your survival does not depend on being well-educated or competent at anything you do in life. You are free to hone you natural inclination to sadism and cruelty toward others. You can lie and cheat and manipulate with impunity. You can accept the aid of the enemies of your country to con your way into the presidency instead of renouncing such aid as traitorous.
You will have willing accomplices who will enable you throughout, because there is nothing in the world that is more important than the power of money.
68
@Susan
Say it ain’t so!
Sadly I have no evidence to dispute your assessment.
3
This is crazy. Remember the objective is to solve the border "crisis". Democrats and some notable Republicans have proposed a sensible program of processing asylum claims within the Central American countries, and increasing the number of judges to process the existing backlog of asylum claims, and to provide more assistance to address the breakdown of the standard of living in these countries. This is what the President and his advisers should endorse.
Our apparent difficulty in solving the border crisis seems to be related to the 2020 Election cycle to give grist to the anti-government propaganda campaign which the GOP believes cuts in its favor. I think they have it all wrong and this strategy is only undermining the international reputation of the United States.
Democrats should continue to define the major problems in the U.S. and the legislation they propose for a Democratic Congress and White House. I believe Americans want a change in leadership and new approach to providing economic justice in correcting the wage gap. And, for example, I thought for certain that we would be able to agree on infrastructure spending and providing better health, education, and incomes to more people than we do now.
I read though Senator Warren's approach to global warming and think she has a workable program to develop markets for U.S. produced technologies that will strengthen the U.S. economy and in the end improve the lives of American families.
Tariffs are wrongheaded.
16
@james jordan
You are obviously not crazy James Jordan but these are not evolutionary times and we have no ideas what the new economy will look like and only Andrew Yang is presenting a true scenario of a world in flux and presenting possible solutions.
I was an Amerophile. I was never one of those phobes that cannot deal with changing demographics, equal status before the law and a Bible that has no real history
but deals in timeless allegorical truth.
There is no border crisis there never was a border crisis and never will be a border crisis. If America cannot provide jobs for those fleeing chaos they will not go to America.
How blind do you have to be to see that the GOP looks like America used to look and the Democrats look like America's future?
Our workforce has a female majority because the world is competitive and we need the best and brightest. Whether it be medicine, law, economics or politics stupid doesn't cut it any more.
I was in DC last month and it was the America I loved but it was not an America that is acceptable to the GOP.
Donald Trump should sound the alarm that crony capitalism has destroyed your once great country. I am sick and tired of the cries of intellectual property . Silicon Valley is 70% foreign born. It is a global economy and soon you will be Russia unless you invent a new America or provide a safe place for your citizens that believe the GOP has anything of value to offer.
1
It's June and the only way a lot of farmers can get into their fields is by boat. The extra water is blocking barge transportation too. I thought that climate change would show up as drought and extreme heat. Folks that depend on the weather are in for a wild and unpredictable ride.
36
@Swannie The local news shows us that large parts of the Midwest are under at least eight feet of water. Agricultural news tells us that this is all going to affect crops and the surviving livestock because the farmers have to wait for the water to recede. As grains like corn and wheat and meat like beef and pork become scarce, the scarcity will affect prices, and usually in the wrong direction for frugal consumers. The flooding has also destroyed whole communities, which means that millions of miles of levies, bridges, roads, houses, barns and businesses will need to be rebuilt.
Considering the disasters we are facing, this does not seem to me to be a good time for a trade war which will only further jack up the price of groceries or a time to put a cold stop to the undocumented people crossing the border. We will need those good hard-working people to help do a rush-job on the crops when the waters do recede, and to rebuild our levies, bridges, roads, houses, barns and businesses because they are willing to do the work for cheap.
24
@Jackie -
What will happen to SNAP (food stamps)
for the poor?
3
@Swannie
And still they stick with Trump. Go Figure.
I have a more sinister interpretation of Trump's tweets about tariffs. Trump has now learned that he can 'move the market' by threatening to impose or lift tariffs. Can anyone check whether Trump, his family, or anyone in his administration is trading on advance knowledge of these pronouncements? There is strong need for scrutiny given his record of economic improprieties.
173
Markets are ignoring analyses like Professor Krugman's. They see fault & wrong with everything President Trump says & does but are usually wrong in their predictions & conclusions. Market participants understand that one man is not the entirety of government or the economy. They understand that GDP growth is 50% higher today than it was in 2016. They understand that China's foul play within the global economy needs to be addressed as this paper's Thomas Friedman acknowledged in his last column.
Markets understand that Trump has broken the mold of the stoic & silent President who is supposed to take all incoming fire such as this column quietly & serenely. Our earliest Presidents such as John Adams were vocal critics of bad press. Trump likewise is a vocal critic of a tainted, biased & bitter press and he's not afraid to say it. I'm not always a fan of President Trump but I do appreciate his willingness to point out the deprivations of an unethical, hostile, and too-often dishonest media.
1
@Once From Rome
"Trump is a vocal critic....", but he is inconsistent in what he says and most of what he says is not true; therefore (1) it is best to ignore him, and (2) it is fair to mock him.
15
@Once From Rome, if you really believe that the mainstream press--a pillar of our democracy--is dishonest and "bitter," then you're a fan of Donald Trump.
Anyone who aspires to the presidency needs to leave his ego behind because he serves all the people, not just his own interests. He serves the institutions that preserve our democracy. No one asks him to be "stoic and silent," but it's not too much to ask him to be a mature adult.
Please don't compare a showbiz huckster to John Adams.
4
@Once From Rome: "GDP growth is 50% higher today than it was in 2016.
No it isn't. Sounds like you yourself have been reading some "dishonest media", because this is untrue.
6
" .... his character flaws will actually lead to destructive economic policy."
Already has. Although not specifically about trade, the hoo-rah surrounding Iran has led to our (heretofore) allies and cosignatories to the JCPOA examining mechanisms to permit trade with Iran while circumventing the US financial/banking system and thus sanctions.
It is an important psychological shift, from "Is this even possible?" to "How do we do this?" And once a workaround is found,it is a matter of time until some genius figures out, "Oh, we really don't need the US or the dollar for petroleum or other international settlements." At which point, you can kiss the dollar's dominance in international trade goodby. More efficient to deal in dollars, perhaps. More expedient, perhaps. But there are -lots- of options once our trading partners are open to possibilities. The Euro block is as big as the US; China is rapidly getting there. Combinations with other nations or blocs (Japan, Korea, SE Asia, India, perhaps Brazil and Mexico ...). The possibilities are endless, and none bode well for the US.i
35
People are so glad Trump isn't destroying things entirely that they forget just how badly he's doing and what actual progress might look like.
1. Instead of continuing the 2010-2016 streak of fewer uninsured each year, 2017 saw the first increase since 2010. About 2 million people have lost health insurance since Trump took office. Rather than tackling rising healthcare costs, Trump also made them worse with his ACA sabotage.
2. Instead of a falling budget deficit with a solid economy, the 2018 budget deficit of $800 billion was 60% above the $500 billion CBO forecast for that year when Trump was inaugurated.
3. Breathing a sigh of relief at avoiding tariffs? Why were they even on the table? Why are we grateful Trump is limiting the damage from his own trade wars with our allies?
Real policy is basically raising taxes on the rich to expand healthcare and education. To the extent that isn't happening, we're headed the wrong direction.
115
With all due respect, Professor Krugman, Trump’s actions are consistent and predictable. His goal, like that of the Republican donor class, is to weaken the U.S. government to the greatest extent possible. His interests align more with those of the Russian oligarchs than those of ordinary Americans. The rich are different, as F. Scott Fitzgerald famously pointed out, and the failed sons of rich parents are different from the failures of more common folk, no matter how much they want to think otherwise.
Trade agreements between national governments are a relic of the past, like the trackside water tanks we once needed for freshening up our steam locomotives. Capital moves globally, and the “tariff” on China or Mexico is in most cases being applied to an entity that does business in both countries and reports its profits in Ireland, or in some bought-and-paid-for Caribbean island.
In this context, the cycle of threatening and caving has a strong positive effect, since it further destroys the legal regime that empowers small importers and exporters, while leaving the larger entities untouched, at least to the extent that they have paid their protection money.
Trump does not require a “coherent economic plan” to serve the interests of his backers. And let’s be honest with ourselves: if the Democrats had not been so beholden to much the same people, and as eager to misdirect the voters with cultural issues, the United States would be looking quite different right now.
29
Hemingway: "The rich are different than you or I." Fitzgerald: "Yes, they have more money." I agree with the spirit of your post but that was the exchange as I remember it.
3
@Global Charm: I like your observation that "the failed sons of rich parents are different from the failures of more common folk". This is something that needs repair. When Bush the Lesser was elected president by a 5-4 vote, it was clear that social mobility in America had become meaningless. In order to be genuine, not only must the talented children of the poor succeed, but the lazy and foolish children of wealth must fail.
1
Having Trump as President of the United States is really risky for both the U.S. and the world - major macro risk, not just economic risk, but physical risk. It blows my mind that the markets don't take that seriously. I have to conclude that it's just all short term trading, and people figure they'll make money and either get out or at least be ahead when something really bad happens. Another possibility - and these are not at all mutually exclusive - is that the people doing all this trading neither know nor care about history and so cannot benefit from its guidance as to risk. The parallels of many aspects of our times to the 1930s are impressive but you have to know something about the 1930s to appreciate them. And then there is the stuff that is unprecedented, like climate change. Then, too, most of the actual trading is done by machines. The algorithms to buy or sell don't change depending on who is President - maybe that's what it is. One way or another, the markets act as if everything is normal, and it is not. " 'Buy low, sell high,' that's all ye know and all ye need to know."
24
the USMCA may be The Trade Deal Otherwise Known as NAFTA, but as far as Trump is concerned that name change is all that matters. Like most Trump Hotels, they're actually someone else's projects but the Donald gets his value by branding them. It doesn't matter if it's just some signage so long as he can claim credit. And the name in this case is carefully chosen. "North America" is avoided for it implies there is something inclusive and thus greater than the United States itself. So the name has to have that "US" in it instead, at the beginning, with the"M" and the "C" coming after.
20
I do think that Trump’s instability is the one thing the world can count on these days. And world leaders have been - for the most part - working to be restrained in the face of Trump’s erratic behavior. When he finally leaves, though, I fear there will be a great slump as the world recovers and rests from what American voters have done to it.
11
My guess is that markets are celebrating because the more Trump debases the presidency of the United States of America, the closer they get to a USA without rules on global corporations. The more Trump attacks the Constitution, the closer they get to a capitalist USA without democracy getting in the way.
The Mueller Report lays out crimes by Trump, but he is still hanging on, which promises global shareholders (most with no loyalty to We the People) that he may yet shred the Constitution and finally turn the USA into the largest and most powerful banana republic in history.
Trump calls for violence against the press, protesters, and political opponents. Mueller's detailed accusations of Obstruction by Trump (underlying crimes are not required by for Obstruction because that would reward Obstruction) and publicly reminded us "the Constitution has a process other than the criminal justice system to accuse a sitting president."
Republicans have taken up Barr's "defense" of Trump, which is essentially to accuse him of putting his personal frustration over an investigation into Russian hacking of U.S. elections above the defense of our elections from Russia, because it embarrasses him. That is not the job of president. The Commander in Chief is supposed to coordinate our defense agencies in a defense. Trump has spent over two years pretending the attack never occured,
Not even Trump's cheering base needs Mueller to tell us Trump is attacking the Constitution every day on TV.
40
One of the great ironies of the Trump Era is that, if Donald Trump said or did nothing about the American economy, the momentum of an unprecedented boom would have continued long enough for him to benefit from the rising prices of equities.
While the level of the stock market is not an accurate measure of the health of an economy or a reliable indicator of how well the average American is doing, Trump thinks the Dow Jones is what counts. So, apparently, do many journalists and politicians.
As we know, Donald Trump cannot resist taking center stage to fire off threats and to impose nonsensical tariffs. The result is that the putative leader of the free world makes seat-of-the-pants decisions and noise which would send weaker economies down the drain.
If it dawns on Donald Trump that the smart money is ignoring him, that is a bad thing for all of us. Trump, sensing that he is losing the spotlight, would have no compunctions about starting a war to show his authority and to regain respect for his power.
16
We all know better, Mr. Krugman, and so do you. Markets are, always have been and always will be stoic, objective and predictable in the face of passion, panic and paranoia of human behavior. The rest is just noise.
3
Yes, stoic and stable markets like those in 1901, 1907, 1929, 1973, 1987, 2008.
7
So what explains crashes? We all imagined 2008?
4
@Guido Malsh
"Markets are, always have been and always will be stoic, objective and predictable in the face of passion, panic and paranoia of human behavior."
Wish fulfillment. Dogma unsupported by facts. It ain't necessarily so:
https://www.youtube.com/watch?v=u1eSiso7VZs
"At this point, evidence that Trump tweets are sound and fury signifying nothing is, in effect, good news." Please tell your friends on the news beat to stop covering them, then.
14
If one takes a glance at history, one knows that satire is one time honored way of deflating a leader. Once the general populace is laughing at the leader, a lot of his power is deflated, like putting a spike in a blimp..it falls to the ground. Trump is succeeding like no other cartoonist in satirizing himself. People are still laughing but the amplitude is dropping. The stage after laughing is frank boredom and I think we are entering this stage now. One hears Trumps words, wherever they come from, as ‘signifying nothing’. These bleak years will pass.
453
@Hugh Garner Yes, perhaps that's why the stock market is showing little concern. They know the end to this maniacal period in our history is close to its comic conclusion.
22
@Hugh Garner You may well be right, but we also lose 4 of the 10-12 years we have as a species to avert the most catastrophic results of climate change
81
@Hugh Garner except the executive orders will take a lot of political will to reverse.
32
"Is America great, or what?" When describing America, the majority of people in this country and probably a larger majority of the world would choose, "or what." Investors might want to consult the philosophy of Alfred E. Neuman, "What me worry?"
5
Since Krugman asked "Is America great, or what", it does have the best democracy money can buy.
14
While Trump is content to blather, I worry what lack of oversight markets and the financial sector are enjoying. The economy is slowing down, all needles point towards a looming recession, the markets are heavily bloated far beyond the heady days pre 2008. Industry may have become insouciant to the ravings of the president, but what is their inferred entitlement to play loose in plain sight? How much latitude to engage in nefarious business dealings do industries perceive and how dire has it become already? How bad can it get?
George W. Bush wanted clear economic playing fields where sectors could police themselves, and that ended proving that thieves had no intention of catching thieves and that they all shared the proceeds of crime with impunity. Under Trump, a crash will reoccur, it’s simply a matter of time.
16
@Marcus Brant
Yes, and when the crash recurs, "The last bailout was unprecedented in scale. These corporations were kept viable in a period where, in a capitalist economy, they would’ve crashed. But we don’t have a capitalist economy — business wouldn’t accept that, and they have enough power to prevent it — so, therefore, the public comes in to pour literally trillions of dollars into the hands of failing corporations and maintain them." https://billmoyers.com/story/noam-chomskys-requiem-american-dream/
So the financial elite is sanguine. The taxpayers will bail them out.
8
All this craziness is being done without a peep from Congress. Or at least the Republican party which has become the party of Trump. Dems need to loudly and repeatedly message that they oppose this autocratic usurpation of policy and creaye news by stating how they plan to address the issues.
12
@JCX
But they won't oppose it; at least the entrenched in both parties -- those politicians who are in bed with their true constituency -- the ultrawealthy and multinational corporations -- will not lose that constituency by interfering with the cycle of crash and taxpayer bailout.
2
"But for now, investors are effectively treating Trump as crazy but harmless. Is America great, or what?"
I have a few niggling worries here. What will investors do if Trump carries through on one of his crazier threats on tariffs? What will they do if one of his more outlandish tweets or comments prompts some unfortunate reaction from another country that decides NOT to discount what Trump threatens? At some point he will overplay his hand and get the reaction he doesn't want. He'll cry foul but as anyone who has ever witnessed bullying behavior knows, he'll never own up to his part in the reaction. Everything is about Trump unless it's a reaction he doesn't want. Then it's the other guy or gal who's at fault.
Trump is the man who walked out on Pelosi and Schumer because Pelosi told the truth about him. Trump is also the man who keeps on telling us that there was no collusion and he's been exonerated. And now he despises Mueller because Mueller made it quite clear that there was no exoneration.
Trump is playing a very dangerous game with the world. He's putting us in danger with this game. If the schoolyard taunts become an all out war will anyone in this administration or the GOP be willing to step in as an adult rather than continuing to let Trump get away with playing President Bully? That is the key question here. Do they have any sense of self preservation or interest in keeping America alive as a nation?
6/10/2019 10:29pm
743
@hen3ry Excellent comment. Thank you.
51
@hen3ry
The problem is not only that the President might act on one of his treats.
The adequate conduct of diplomacy & international trade & commerce depends on a modicum of good faith bargaining & implementation of commitments once made. Where that good faith cannot be depended upon, international trade & commerce & the resolution of international issues become too uncertain & complex. The confidence needed to make & carry through international projects is lacking & the cost of lost opportunities multiples.
Domestic politics & democracy itself are cheapened as increasing numbers of citizens exhibit passive acceptance of President Trump's antics as some game show writ large; as a new normal to be regretted & satirized, perhaps, but not to be actively opposed through democratic institutions & processes.
91
@hen3ry
Don't ignore "we the people". We (citizens) need to do our part. Confront those who lie. Make your own viewpoint known. Do not abide those who lack facts, yet still want to be an advocate for their point of view. To spite the guy in the White House, we need large gatherings to counter his "rally" mentality. Question why no press conferences, only rallies. Urge people to register to vote. Remind people to vote. Hold a sign protesting the ridiculous policies of the guy in the White House.
We can all do something to end this national nightmare. Pick your own way. Do something!
54
The markets seem to believe, like I do, that much of what Trump says is simply bluster for show off to his base. It's either a lie, or a bluff, or he'll change his mind or just ignore it later.
The point is to make a show of sticking it to brown people somewhere -- whether he actually does or not.
Sorting out the facts is not his supporter's strong suit.
So their bet is -- just ignore him. He's sound and fury signifying nothing.
5
Anyone who has so many bankruptcies should never be taken for granted. When you're dealing with a nasty narcissist with the temperament of a five -year old, you'd be wise not to discount his irrational behavior as simply a delusion while ignoring the immense destructiveness and danger it poses. Trump blinked on the shutdown when Nancy Pelosi faced him down, and blinked again on imposing tariffs on Mexico when his Republican Senate threatened a veto-proof rebuke. But the trade war with China may precipitate an economic contraction of even worse.
10
@Paul Wortman
Agree. Chuck and Nancy care about the U.S. and calibrate their position accordingly. China has no loyalty to or concern for the well-being of the U.S. except insofar as it (China) depends on the U.S. as a market for its goods.
4
@Paul Wortman Most five year olds are quite sweet tempered. Trump is more like a two year old.
"...the president of the United States is seriously out to lunch." I laughed at the choice of words. Then I wondered whether to weep.
12
@Thomas
Reagan was out to lunch, too. The U.S. didn't have a president. The elite loved it because it gave them a free hand. Trump is out to lunch but it's clear to more and more people that he is. That's not an advantage, though, because he's willing to throw a Molotov cocktail into the system to assauge his fragile ego.
9
Yes, it's a good thing that a lot of people are no longer taking our inept, impotent excuse for a president seriously. Still the danger lingers on, as Trump is used as a distraction from the behind-the-scenes actors who daily try to harm us ordinary Americans.
22
Looking at the regulations being cut or neutered, the delays in hiring people doing safety and environmental oversight, the lack of any controls on banking, loans, and gambling - oops, I mean investment firms, the future looks not so bright. The Rs in the Senate seem quite content to let OMB slow the hiring process (really, the job listing process) for regulators which Congress authorized in the FY2019 appropriations bill. trump, mulvaney, pence, and McConnell are quietly cutting the government's ability to reign in even the worst actors.
So as terrible as his words are in each tweet, each "speech", they do act to distract from longer term damage. Another failure of a drilling operation in the Gulf or elsewhere because safety is just "too costly" appears to be a small price too pay for better bottom lines for oligarchs.
9
The dangers of an unrestrained executive surrounded by people with the power to limit his influence and the intelligence to know what they are are doing, and who do nothing, was vividly written about today in the obituary of Rudolph von Ribbentrop who visited Hitler in Berlin during the final days of the war.
12
"But for now, investors are effectively treating Trump as crazy but harmless."
Let's hope that confidence holds should our country face a real crisis, economic or otherwise. Despite President Trump's actions and rhetoric, we've had a somewhat stable few years. But having Mr. Trump lead our country in the face of a major disaster or crisis? That's a different story, and the markets know we're living on borrowed time.
16
@jrinsc
Trump's blather is nonsense, but it's dangerous nonsense.
There are several comments here (and previously) about the possibility that Trump’s rants and the effects they have on markets might be designed to benefit him, his family, or his cabinet. I doubt that Trump has the intelligence to cook this up himself, and it doesn’t take much intelligence on the part of his advisers to recognize that the SEC could track investments made by his inner circle and conclude that there was manipulation of the markets. I think it is more likely that there is secondary or tertiary manipulation by investors who have no connection to Trump or his administration. Krugman points out the growing recognition that these rants will come to nothing, and a smart investor who concludes the same may very well wait for the next rant, time purchases in the expectation that the market will decline 3-4% in the initial day or two, then sell when the market recovers a week or ten days later. Given Trump’s predictability and the pattern that has been established, this would be easy money without any fear of insider trading. But like most investment schemes, its prime has probably already passed, since only those who recognized the pattern early, before the hordes were onto it could benefit.
10
@Ockham9
If someone knows beforehand that Trump will attack a market, then they would still be able to profit when everyone else found out about it.
Don't underestimate Trump's intelligence. He is completely uneducated, but he has a genius for manipulating the media and his white supremacist base that makes him extremely dangerous. It doesn't take that much for a professional manipulator to realize that the president can manipulate markets.
I don't know if Trump is doing this, but it is one possible explanation for his bizarre attacks on the global economy.
2
@Ockham9 Don't forget that "playing the market" on fake take-overs was a way for Trump to get a lot of $ . This man is vicious and corrupt at a level we do not imagine possible for his actual function. Add to this Putin and his friends, you get a disaster brewing for the honest investors. Trump is currently looting the USA.
What concerns me is that Trump now realizes he can manipulate the stock market through his threatened tariffs - so he just plays tough with China for now then makes a deal at the best possible time for his re-election - claiming he is a trade genius for solving his own self-induced crisis.
15
"What investors want to know instead is the extent to which his character flaws will actually lead to destructive economic policy."
Unemployment numbers and the stock market are everything to Trump. Whenever the market goes down, even a little, he jumps on the Fed, accusing them of doing the damage. With the election coming up next year, Trump won't do anything to tank the economy. His behavior is all smoke and mirrors for his ongoing reality TV show, to stoke his base. He constantly watches the economy. He knows that its shiny veneer is all that he has going at this point. If things start to really go south, he'll pull back. He has no substance.
14
@Blue Moon
He'll pull back, but not necessarily before lasting damage has been done. He holds unchecked power in this area. Short term benefit to his popularity (and attention-getting), long-term damage, not least to U.S. credibility. The value of currency depends on trust, and Trump, while in charge, makes the U.S. an untrustworthy trading partner and world financial capitol.
5
Since Trump's inauguration, the Dow went up by 25% or so in the first year more or less continuing the growth under Obama. But since January 2018 the value remains overall unchanged except for massive swings up or down depending on his latest tweets. So for long term investors with 40iKs nothing has happened. But for professional traders who know how to make money on short term swings, both up and down, the last year and a half of instability has been a godsend.
20
Re:
Now, not having a destructive trade war is a good thing. But what the world learned from this climbdown is that Trump’s threats are as empty as his promises.
We should keep in mind that climbdowns can occur only if there is sufficient real pushback from affected groups. The fact that he got told in no uncertain terms by most of his Senate enablers that whatever it was he thought he wanted to impose on Mexico was a terrible idea. Then his business buddies told him the same thing. So that was sufficiently
loud to get through the walled off from reality ego.
An issue not yet comparably resolved is his EPA plan to
eliminate the Californian exception re automobile exhausts.
Automakers had to leak their genuine anxieties a week ago to the press in the hope that might convince wheeler and chao not to go the mat with this "plan" based upon a tepid mpg increase + legal effort to sue California into submission.
It's not clear how this will play out, nor what form a capitulation in all but name will take, if there is to be one.
I assume NYT readers will be kept fully informed.
12
Let’s not forget that Trump Organization played the markets, and made a killing by knowing in advance which stocks to sell or short. We used to call that insider trading, and that used to be considered a crime. We have thoroughly thrown our moral compass out the window, along with middle class wealth accretion opportunities.
420
@Sam Gilbert: This scam has been suggested, and I wouldn't rule it out on the grounds of ethical norms, but I haven't seen any evidence. Apparently at one time, Trump himself used to have a little scam where he would make a show of raiding a company's stocks, then selling off his holdings when the price went up in response to his fake raid. He quit when other investors figured out that he wasn't the deep-pocketed raider he pretended to be.
But my sense is that these days the Trump Organization is pretty much continuing with its usual real estate branding projects, rather than trading on the stock market. Of course, if they are doing any nefarious trading, evidence will come out, and that will be quite a drama.
9
PK's analysis of the shrugs coming from the financial markets about Trump's erratic (to say the least) behavior reflects a ubiquitous cynicism about American politics. Ignore the day-to-day more monthly swings and you will see over time that we appear to have two side-by-side but estranged forces dominating our society.
It shouldn't be that way. You can't help but feel that when the markets disdain the political environment, and politicians decline or refuse to understand the impact of political choices on market fluctuations, then something is seriously amiss.
The old saw that "markets do not like uncertainty" appears to be on its last legs. Trump is the epitome of uncertainty; in fact, he promotes chaos like a kid throwing a tantrum in Wal-mart. But if the markets are ignoring his petulance and ignorance -- if investors have "baked in" Trump's bizarre behavior -- then the possibilities for a major financial breakdown would appear to be increasing.
21
Sorry to say, but my sister-in-law firmly believes Trump really won this round against Mexico, and Mexico really caved to Trump's clever strategy. Why? Because Trump told her and his base so in his tweet.
Nonetheless, I enjoyed this description of Trump's latest Mexican Tariff-Tax political stunt linking immigration to tariffs (say what?), which says more than anything else I have read about Trump's economic acumen and strategy. It is truly dumbfounding, but our president has absolutely no idea what he is doing.
Please remember, however, it is not our (the voters) fault--we elected Hillary, not The Donald. But as Donald said while campaigning, "The system is rigged," and boy he better be glad and thank our unlucky stars that the Electoral College anointed him President in 2016.
My point is this column needs to be saved for posterity, because it really conveys the feeling of what it is like to follow the bouncing-ball antics of our delusional and bullheaded, belligerent presidential apprentice, Donald J. Trump.
The words I would most like to hear as soon as possible: "You're Fired, Mr. Trump."
224
@PB: Personally, I'd much rather hear, "Mr. President, you are under arrest for campaign finance violations; obstruction of justice; income tax fraud; and violation of the Emoluments Clause. You have the right to remain silent. Anything you say will be used against you in a court of law..."
69
@PB
Trump's base (both the coal miners and the ultrawealthy individuals and corporations) will follow him until the economy starts collapsing, and then it will be very difficult to put Humpty-Dumpty back together. By then, Trump will be gone, the taxpayers will bail out the financial elite, and the ultra-wealthy will buy elections to coronate a replacement to someone who will distract the people while letting them act with a free hand.
18
@PB
"political stunt linking immigration to tariffs"
It's blackmail - I don't know why more people are not calling it that.
12
A vast and endless kabuki theater encompassing nuclear weapons, beachfront real estate, immigration, trade, agricultural products, automobiles, electronic goods, and perhaps market manipulations to reward the inner circle with prior knowledge of what Trump's next move is going to be. The world at large has caught on and is stifling a yawn. The markets, as is their wont, panic first and then sheepishly retrace their steps. Even the base is a little puzzled.
8
@Partha Neogy
Meanwhile, climate change and the runup to nuclear war accelerate.
2
This was all a political ploy based upon the seasonality of apprehensions along the border. Trump knows apprehensions have peaked for the year will generally start decreasing through the holidays. Trump can claim to his base that his "Presidential" action has curbed illegal immigration. He had no intention of putting tariffs on Mexico.
A quick look at apprehensions along the border shows a strong seasonal trend. It peaks in May/June; decreases through the summer (if you know the temperatures in Arizona, NM and Texas you know why); increases briefly in September/October and then drops to very low levels during the holidays and then starts increasing again.
13
Or . . .as a number of commenters have speculated, these on again, off again tariffs are designed to move the stock and other markets in short, sharp movements that allow those that game them to short sell and low buy and do all the other things that enable gamers to make windfall profits here and there.
Now, I don't think Trump is intelligent enough to have come up with this as a scheme on his own, but he is certainly surrounded by unscrupulous "advisers" who know how to game the markets and who, knowing how Trump tends to remember just the last rant he hears and act on that impulsively, certainly whisper things into his shell-pink ear and goad him into actions that result in them being able to make some quick tidy profits, even if those actions are reversed a little later and the overall long-term economic effect is minimal.
And I'm sure some of these "advisers" have involved some of the Trump organizations' own monies in this process as well, hinting to him how it will help him and his. After all, no one seems to deny that entities want to monetize the fortune of Trump's presidency whiel the gettin' is good.
79
@Glenn Ribotsky In short, the pump-and-dumpers are now really in charge.
13
@Glenn Ribotsky Do you really suppose that guys like Wilbur Ross or Steve Mnuchin could really be that corrupt? I'm shocked!! Shocked, I say, at the thought!!
2
The only reason Trump is seemingly, but not, harmless at the time is because the pressure is bearing down on him. The only thing keeping him from killing is freedom of speech, which he opposes.
5
*****But for now, investors are effectively treating Trump as crazy but harmless.*****
So writeth Paul Krugman. But "investors" must not be reading the same newspapers I do, because there's widespread reportage that Trump has (delusionally, to be sure) been "emboldened" by his "win" vis-a-vis Mexico, and will therefore intensify his trade war with China.
If I'm the CEO of a US firm that participates in the global economy, now is not the time I'd be green-lightning new projects or major investments. Trump has simply created too much uncertainty. That can't be good for growth over the next couple of years.
121
When Trump blisters and then folds no damage is done. But all it takes is one time that the other side overreacts and we are in a trade war ... or worse.
Remember that the Korean War was caused by the accidental omission of that country from those the US would defend. Loose lips sink more than just ships.
12
Awesome piece! Irrational exuberance comes in many flavours. Including discounting pervasively destructive behaviour by our pseudo president.
10
I was totally in agreement with the 1st part of your comment: It’s a disgrace that we have to rely on President Trump. You lost me after that though. How can having one of the world's worst records in gun deaths not rank as the most pressing issue? Is life really that cheap?
12
@Rebel in Disguise: Yes, gun violence, opioid addiction, under-education, our failure to respond intelligently to global warming... there are lots of things more important than the rising or falling of the stock market. But PK is a trained economist, so we have to tolerate his specialized interests.
4
@Rebel in Disguise
"How can having one of the world's worst records in gun deaths not rank as the most pressing issue?"
By being eclipsed by the existental threats of climate change and nuclear war.
3
More people die from car accidents. A lot more people die from preventable diseases. Violence is much more noticeable but it isn't our biggest problem.
2
We all know that Trump is crazy, however, the only time the crazy backs down is when the business community goes nuts and starts screaming at him. When Wall Street goes nuts then he backs off. Democracy doesn't matter; individuals rights don't matter; who is being oppressed doesn't matter; long term planning for infrastructure doesn't matter; having a populated educated to compete in the 21st century doesn't matter - just cuts for Wall Street and the 1 percenters that's all that matters. De-regulate everything because that serves the short-term needs of the business community. So the rich get richer and democracy dies.
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@Kathryn Meyer
Well said!
Bottom line is that we all should know by now, that we can deal with lots of things ... but, we can’t deal with crazy.
6
Those non-business things "don't matter" because they're not as organised.
2
@Kathryn Meyer: Democracy isn't the only thing that is going to die. Climate Change changes the equation - on everything. It would be hard enough to fight successfully, but with a crazy man who thinks the Chinese invented it to scam us.....? We are wasting the time necessary to save ourselves.
5
Trump is progressing perversely. I used to be embarrassed by him. Now, I'm humiliated.
21
@bnyc
We've been humiliated by the financial elite for a long time. It's just more obvious to those who are not swaddled in infantile wish fulfillment.
1
Trump has rendered himself irrelevant; a hapless clown.
His supporters not so much, and now that they've had their time in the sun to crow and froth, they will not shrink back into quivering, angry silence.
The judges that flew through confirmation will be with us as well for a generation at least.
As we celebrated the 75th anniversary of D-Day, the same drums that were silenced are beating again in Europe and Asia.
At the very least, Trump must be defeated in 2020; and we can begin the work that will take a generation to restore sanity and justice.
37
Paul, we are glad the markets aren't rattled by Trump's delusions, but we sure are. How can anyone still support this 'so-called' president? He lies all the time and has done less for Americans than any other president ever. Not to mention, the 'welfare' gift to the 1 percent in tax cuts for those who don't need them and his love of authoritarians and thugs, taking their word over our intelligence services. As Maher just stated, 'It may not be the legal definition of treason, but when he takes the word of another country over ours, that's treason". The day of reckoning will come. No one is above the law and as John Dean said today, there is no executive privilege to cover criminal and fraudulent behavior. Justice needs to be served.
35
Me wishes the media would stop “treating evidence of his unfitness for office as news.” Everything Trump says seems fake or half-baked, a political ploy, or some idiotic nonsense that shows every thinking person his limits to govern. Can’t the media put out his statements after checking them? Normally this would be done by a President’s staff but they seem too busy placating him or are as unknowing as he is!
5
In response to disappointing economic news about the economy failing to add only half the number of expected jobs last month the stock market rose. So much for it being an indicator or predictor of economic health.
8
Donnie Disaster. Someday, his luck will run out. Ours already did. Bigly.
65
Trump is certainly not harmless. His tough/bluff/backdown economic style, is tiresome and concerning. Words do matter, and the words of a President carry a lot of weight. That Trump's use of the English language comes with added uncertainty and fear, may lead to Trump escalating a trade war, with no winners.
Trump's words are not carefully constructed, detailed, thoughtful, nuanced prose. They are usually aggressive with menacing threats. This is no way to run the US.
Another major issue with Trump's threats, is that innocent nations may be collateral damage. We in Australia need the Chinese economy to stay healthy, as it helps our economy and our mineral exports. If Trump's policies cause China's growth to stall further, it would be devastating for Australia and many other nations.
If Trump's policies lead to a recession, Trump will not care about the millions who would be hurt. Trump does not know or care about anyone, other than Trump. That is the real concern with his ignorance, and completely unjustified self confidence.
46
this is another example of trump on display as a Stalinist, and to top it off he is using the language of Stalin, "Patriot farmers."
23
I'm surprised he isn't claiming to fulfill his "four year plan" in only three years...
2
The Republicans in the Senate were not going to let tariffs against Mexico stand. Trump knew he would look weak if he imposed tariffs, and a veto proof majority reversed him. So his only choice was to back down. But he had to do it with lots of bluster and declare victory. The only problem is that every other world leader knows exactly what happened.
22
@Roger Those same World Leaders that laughed at him at his 'speech' at the UN. And I am certain they know a lot better exactly what Donnie Danger is doing than he does himself.
Sadly Enough.
4
It's not a "spineless Senate". It's an emboldened complicit conspiratory Senate doing the bidding of the Trump Wall st Administration from tax cuts for mostly the wealthy to tariff consumption taxes on the 99% to pay for those tax cuts. Let's remember former Senator Sessions was an early participant in the Trump Campaign and likely coordinated with his Senate colleagues. Have you noticed Trump hasn't been back to Manhattan for a long time?
24
@WITNESS OF OUR TIMES: Good point. People talk as if they expect the Republicans to turn against Trump because he's dishonest, or racist, or authoritarian -- but it's their agenda that is being carried out, to a close approximation. He's their guy. Look at all those judges!
6
@John Bergstrom Republicans like Trump "because" he's dishonest, racist and authoritarian. Those are selling points, not disqualifying factors.
2
I know people have raised this issue on other forums, but SEC should really look into Trump's rants and tweets and how they tend to move the markets. It is not inconceivable (in fact it is quite likely) that some people in his circle of crime, with a prior knowledge of what the next tweet is about, are benefiting financially from the ups and downs of the market.
Our president is probably the ultimate source of insider trading information.
1158
@JB
My thoughts, which I've been promulgating on Facebook, exactly.
No doubt, his percentage of their takes is guaranteed to be paid by his threat to turn them in after he is tossed out of office.
Let's hope the SEC is keeping a close eye on this conman.
131
@JB, I've seen these comments on other forums, too, and out of curiosity, decided to search for myself one Mexican product that is publicly traded. The price was in the dump until about a day or two before he tweeted about the tariffs. As more people read these comments, the day he announces the tariffs, the price soars because everyone's trying to buy low, but it's no longer low. It's higher than it's been for just over half a decade when another activity happened to cause the price to rise then.
Peter C, you are really "House-of-Cards" cynical. ;) The only reason I can think of that Trump isn't getting into trouble with his tweets like Elon Musk has is because he isn't an insider or majority shareholder of these companies which may be affected, but buddies of his like Wilbur Ross, Carl Icahn, etc. probably are.
85
We have been saying the same thing in our household. Some people are profiting by how he manipulates the market. Follow the money.
166
"Is American great, or what?" What America is, or at least wants to be, is capitalist. Capitalism thrives in the absence of government intervention, just as animals in nature thrive in the absence of a predator. It doesn't want government, it wants freedom for each player to act in his own interest. If government is seen as almost entirely ineffectual that's nirvana for capitalists. Democrats are basically statists, they see government as the predator, the economy is a 'catch' they've made on which they can dine at will. Capital naturally hates that idea, it loves Mr. Trump whose policy inconsistencies render government almost harmless. This is a great period for American capitalism, and thus for all Americans, since capitalism is the greatest engine of social progress ever invented, though many don't realize it.
1
@Ronald B. Duke
Yeah -- "capitalism" gave us all the New Deal initiatives that FDR's Administration created, including Social Security. But watch out: American capital wants all the money in the Social Security Trust Fund so they can park it in the Cayman Islands so they can preserve it for the next 10 generations of their offspring.
31
@Ronald B. Duke
Democrats are statists? Right. Adam Smith himself saw the need for regulation of the economy. Smith wrote that the economic “interests” of businessmen are naturally opposed to the public interest. Democrats understand that. Current day Republicans do not.
15
@Ronald B. Duke
I agree that the United States is now a capitalist construct. Until about 1980 it was a hybrid - a capitalist economy with social shunts that bled off some of the upward flow of wealth and returned it to fund social benefits. We have legacy social programs but those are under attack. For instance, Social Security benefits will now fall behind the cost of living under a new formula.
10
Both the stock market and the bond market are mostly reacting on the basis of guessing what the Fed will do. The Board of Governors is certainly not insane like Trump, but what it will do is not very predictable at this point. Is it taking Trump seriously at all? He still has appointments to make, and even if the candidates are not as crazy as the last two there is still a good chance of doing more damage by making the Fed more irresponsible. Those positions are open because McConnell refused to consider Obama's nominations.
12
"Like many Trump tweets, it reads like a clumsy translation from the original Russian (“great patriot farmers”?)."
He was tweeting what Putin told him to tweet.
74
@Somewhere
Hey, he's got to get guidance from someone successful, someone he trusts.
12
Krugman nails it again.
489
@Registered Repub
House of cards about to fall. Nobody said when, but it will, inevitably. Lack of knowledge, hubris, and criminal behavior. It's the trifecta of failure, which Donald has exhibited again and again. How could you support a guy like this? He can't even get a properly tailored suit or a decent hair cut.
120
@Registered Repub
Krugman did make a wrong prediction back then - anyone who makes predictions does. But I find no reference to "a worldwide recession with no end in sight". Could you give a reference for that quotation? I am especially suspicious since Krugman is an economist, and one who (whether you agree with him or not) uses precise professional terminology. A recession is at least two quarters downturn in real GDP. However it becomes a DEPRESSION if either it lasts at least two years or if the decline in real GDP reaches a
certain point. Both of which would be the case in your example.
I have read Krugman's piece with comments about the internet. It was not a prediction. On that day all the NY Times editorial writers were assigned to write provocative pieces, looking back from 2098. The editorials were meant to be whimsical - and in fact so were the other editorials published that day.
39
@Marvant Duhon, thank you for the thoughtful comment. I learned something that I didn't know.
6
"Trump’s counter was a threat to withdraw from Nafta with no replacement. But this would have catastrophic economic effects, leading into an election year."
We have little evidence that Trump voters understand trade any better than Trump does. If the economy tanks due to his trade wars, he will find a way to blame it on the Fed or the Democrats and, based on their extraordinary credulity so far, most of his MAGA fans are likely to believe him. Railing about "leftists," foreigners and "enemies of the people" has worked well for him so far. Economic strife might turn out to be the ticket to his second term.
396
@Virginia
Trumpists alone cannot re-elect him. He won some key states in 2016 with the votes of independents and disaffected Democrats who agreed to give him a chance. Seeing how well that worked out, they may not make the same mistake twice.
27
@Virginia: Unfortunately, not understanding how trade works is pretty common among Democrats as well as Republicans. This may be just as true all over the world, tempting as it is sometimes to think of Americans as being especially unsophisticated.
5
@John Bergstrom
So true. I cringe when I hear Democrats (liberals and progressives) say that they support Trump's tariff war against China because "we have to stop China!" They have no clue what they are talking about and no idea how ineffective and misdirected Trump's bullying tactics are.
5
It’s a disgrace that we have to rely on President Trump pressuring Mexico to address our most pressing domestic issue (illegal migration). The loathsome creatures that occupy Congress and call themselves Democrats should be ashamed of themselves.
3
@Registered Repub
Yes, it is a disgrace that we have to rely on Trump.
31
What's a disgrace is Trump's sheer incompetence, which is demonstrated by his utter inability to deal with his signature issue -- immigration. The GOP controlled both houses of Congress and the WH for 2 years. Any competent politician would have passed legislation, for example to build the wall. Trump failed to do it.
He made a big todo about family separations, but the sight of children in cages and forcible separations violated decent people's ideas of human rights. That policybwas so poorly implemented that the government struggles to reunite the families, despite the fact that America can track vegetables from farm, through long supply chains, to table.
Trump did nothing to beef up the court system, so it takes years gor asylum seekers to get a trial. In the mean time, they are released. In short, they show up, claim asylum, and get in.
Nor does Trump have any policy for dealing with the instability and violence in Central America, which drives so many to flee.
In short, Trump rants, threatens and tweets, but the few things he's done have been disasterous and most of the logical steps to reduce illegal immigration haven't been even discussed.
The problem is the overwhelming incompetence of Trump for which Democrats are not to blame.
14
@Registered Repub
Only in foxworld is immigration our most pressing domestic issue. Not even in the top 10.
16
I do not follow the stock market, but these past few weeks I have watched its trajectory...down then up then down, nervous, and edgy. Yet, today, "good news." No tariffs for Mexico equals more money for Wall Street. That being said, at best this new so-called agreement with our neighbor to the south is wobbly at best. And the problems with desperate Central Americans will not go away, certainly not with a fool like Trump at the helm. Mexico simply does not have the economic resources and therefore the will to assuage the plight of these refugees. These people are desperate. Their choice is risking life and limb either in their homelands or during an arduous and dangerous migration north. I know which I would choose. Let us remember, too, that this is today. My time is 4:20 PDT. Who would argue that within hours Trump will most likely renege for reasons as absurd as his French fries being served too cold? One final thought here. It is past time that the House starts making more waves. We have the economy to provide aid in the form of medicine, clothing, food, and shelter. I really can care less about those Fat Cats on Walls Street, in the White House, and in Congress. However, we have a moral duty to help these human beings not far from our own country. Only the amoral would argue with that fact.
87
@Kathy Lollock: Someday maybe someone will explain why the stock market seems to be taken as some kind of oracle. As far as I can understand, the money they talk about isn't going towards payroll or investment, it's all just transactions between buyers and sellers of stock. Or abstract "financial instruments". For some reason people as intelligent as PK seem to take it as one of the vital signs of the real economy, and I guess we should pay some attention. But probably some metric like "percentage of kids well fed last week" would tell us more about the real health of the real economy.
72
@John Bergstrom
Time for a transaction tax. It would stabilize fluctuations, prevent skimming, and increase government coffers so maybe we could have nice things the tax scold Republicans won't let us have now, like healthcare and infrastructure repair.
36
If Trump ever says "I'll never use nuclear weapons," then be afraid. Be very afraid.
50
How will the "Trump economy" likely go bust?
Two ways. Gradually and then suddenly.
The U.S. economy is moderately resilient to stupidity -- political, corporate, personal -- right up until the moment it isn't.
Will Trump's ignorance bust the economy in the 589 days left in his term. Probably. Maybe. Who Knows.
I just wouldn't count on the wizards of Wall Street to predict it. The only consistently effective risk management strategy that they seem to have is to lose big bets with other people's money.
Just like our President.
281
@sarah
Something suggests to me you made much the same observation in, say, 2007...
11
@sarah - RIIIIght. And so is America. Again.
11
"Democrats in the House were already reluctant to pass enabling legislation, giving Trump something to boast about, unless they got some serious concessions"
It is one or the other.
Either Democrats won't pass a good trade deal because Trump did it.
Or Democrats would pass a bad trade deal, if Trump gave them something else.
Neither one reflects well on Democrats either.
3
@Mark Thomason Nice try at claiming the Dems are playing politics and harming the nation. But read what Krugman said. Trump's replacement for NAFTA is practically the same as the original bill. So for Democrats to refuse to pass it unless Trump adds some actual improvements merely leaves NAFTA intact, which is a perfectly responsible option.
520
@Mark Thomason Or #: the trade deal was laughably trivial, which would make the political point-scoring far more consequential than the minuscule economic impactt.
44
@Mark Thomason: Or, reading the complete sentence, maybe they want something actually worthwhile for the country, in exchange for voting for a piece of Trumpian nonsense.
57
I suspect that markets are responding to Trump exactly as he is: entertainment. More importantly, entertainment that keeps his supporters impotently happy, his opponents impotently frothing, and all politics paralyzed except for the steady appointment of judges & regulators who put money over workers & people.
67
@sarah
Except this one.
4
It seems from this column that the American economy could—on its very own—sidle along and do just fine without the preposterous president around to gum up the works. Really, it’s a relief to know that, outside of a complete emotional or psychological meltdown. We might get to 2020 and beyond without conjuring up the specter of the breadlines that greeted FDR’s first term.
On the other hand, the president’s obvious instabilities cannot be entirely discounted. Who knows how he will react to any negative stimuli—and, given his life’s history, not to mention his recent (four years) amateur dabbling in the political arena, it’s much too soon to take a deep breath and think ourselves out of the deep woods, where we’ve been since his inauguration.
But Trump’s fan base—the flooded-out farmers; the ranchers, some of whom loved the view of their cattle and hogs floating down the nearby creek turned into the Mississippi River; the stiff suits down at the local bank who shuddered as their anxious neighbors and customers slouch through the doors, begging loans all over their faces.
And there’s always the cross-border whipping post, Mexico. The president, when he feels threatened, or needs to throw his fans a sop, can always wrench up huge numbers about women and children swallowing the border, a crime that can always be laid down to Mexico.
China, meanwhile, remains the Cheshire Cat down the rabbit hole that we all over the world now inhabit, patiently biding its time.
MAGA. Not.
294
Yes, international business and political leaders know that Trump is wholly unfit for office, and isn't capable of "negotiating" for the cable guy to come to his house for repairs. But away from the U.S., the citizens, investors and shareholders of these nations are largely immune from the horrific damage he's already caused, and will continue to cause.
Middle America is already feeling the affects of his "tariffs" imposed for no other reason than to make his male member appear larger than his Chinese counterpart's. Employment is reeling. The "growth" is only in part-time, gig jobs with no benefits, hardly Americans' ticket to remaining in the middle class.
And certain segments of the stock market have swung wildly, especially these past two years, as he careens our nation into its next recession. As the Boomers continue to retire, the chances they'll face a 2008 recession are extremely high.
The fact is, the international community is thrilled with Donald Trump. They know his threats are as empty as his cranium. There is relatively little he can do to harm them, as he has managed to destroy every international alliance this nation has had for the past 70 years, and has managed to withdraw our nation from trade agreements that were largely favorable to us.
Now, none of this matters to the Chinese, the Mexicans, or the Russians for that matter. Trump is very much the president they want, for they may continue to have their way with him.
147