The divide in economic confidence has become extreme.
The election had an instant impact on consumer sentiment in the US. From one day to the next, their confidence about the economy surged – though nothing changed in the economy.
The major sentiment surveys all show the same pattern: Confidence soared after the election, peaked in March, and has begun to taper off. The surveys also agree: Economic confidence has soared among Republicans but has plunged among Democrats, and the net effect has been an increase in the overall score.
Gallup’s weekly Economic Confidence Index shows to what extremes both moves have gone, how the surge of economic confidence among Republicans has been far larger than the plunge in confidence among Democrats, and that the overall decline recently isn’t because Republicans are losing faith – their confidence remains at super-high levels – but because Democrats are becoming ever more gloomy.
This chart of Gallup’s weekly Economic Confidence Index shows the Trump Bump right after the election and how it has begun to taper off:
The index started in 2008 during the Financial Crisis. With its theoretical range from +100 to -100, it has consistently depicted consumers as a gloomy bunch, ranging from -65 in October 2008 to a pre-Trump peak of +5 in January 2015.
But after the election, economic confidence jumped, hitting +16 in March. And that was it. By early May it was in the +3 range and has remained there.
Gallup has been pointing out since November that the Trump Bump consisted of soaring economic confidence of Republicans that outdid plunging economic confidence of Democrats. At the time, I mused where the sudden, infectious enthusiasm for “Current Economic Conditions” came from, after Trump had for months called those very same conditions “terrible.”
The divide in economic confidence has since become extreme – and the economy still hasn’t changed much, neither for Republicans nor for Democrats, and not for Independents, who’re all in the same leaky economic boat.
So what’s causing the Trump Bump to fizzle?
It’s not the Republicans. The chart below by Gallup, which breaks up economic confidence by political preference, shows just how much Republicans’ economic confidence has shot up (red line). They used to be super-gloomy, at -45, practically in Financial Crisis mode before the election. Since then, confidence has skyrocketed 91 points to +46 and has remained there. Economic nirvana so to speak.
Democrats’ economic confidence (blue line) plunged 59 points, from +30 to -29, and it continues to drift lower without signs of bottoming out yet:
Gallup adds some perspective:
On many measures of national conditions, including economic confidence and satisfaction with the way things are going in the U.S., Americans who identify with the party of the incumbent president rate conditions more positively than do Americans who identify with the opposing party. When the party of the president changes, so do partisans’ ratings of national conditions. That change could occur as soon as a president is elected, as soon as they are inaugurated, or after they have been in office and have been able to enact some of their preferred policies.
The index is an average of two components: how Americans feel about current economic conditions; and how they rate future economic conditions – whether the economy is going to get better or worse.
In terms of current economic conditions, Democrats lost confidence after the election, but remained fairly upbeat compared to Republicans until about the inauguration. Then Democrats threw in the towel on the economy. Since the election, their rating of current economic conditions dropped 33 points, while Republicans’ rating of those very same economic conditions soared 58 points:
In terms of economic outlook, the divergence reaches extremes. Republicans’ economic outlook skyrocketed 124 points from a depression-like -67 to a heaven-on-earth-like +57, though that too has slipped from the peak of 63 after the inauguration. At the same time, Democrats’ economic outlook plummeted 86 points from +31 to -55. Note that the current economic depression for Democrats is still not as bad as it was for Republicans before the election – so it has room to fall and might soon get there.
But here’s the thing: hardly anything in the economy has changed in those months since the election, neither to benefit Republicans nor to hurt Democrats. None of Trumps major economic policies have been passed by Congress, and there are increasing doubts as to what exactly will eventually emerge. So the economic reality is the same as before the election: soaring financial markets and subpar economic growth.
Gallup points out that some of this is normal, that “partisans’ evaluations of the economy change when new presidents are elected, when they take office, and in their first months on the job.”
There are other reasons why confidence surveys change, such as stock market crashes, mediatized economic problems, or some Congressional fiascos such as a down-to-the-wire debt-ceiling fight that pushes the US to the edge of default. The Financial Crisis demolished economic confidence for years.
What does it mean for the economy when Democrats descend into gloominess and Republicans become rampant optimists? For one thing, they’re switching roles, with Republicans more confident than Democrats used to be, and with Democrats less gloomy than Republicans used to be. So the net effect should be positive.
But does it impact spending? Does consumer sentiment ever impact spending? Will Republicans, those that have extra money lying around, suddenly spend more than they would have spent before? And will Democrats suddenly close their wallets? The signs say no.
Sentiment surveys are one thing. Real life is another. Over half of the Americans spend every dime they make, plus some. They have trouble making ends meet. How they feel about the economy isn’t going to change their spending patterns. And those with extra money to burn or room left on their credit cards, well, they have not yet stepped up to the plate either.
But neither one apparently wants to go to the mall anymore. Read… Brick-and-Mortar Retail Meltdown Has a Busy Month
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I don’t know what Republicans are so happy about. Trump is not getting anything done. He’s forgotten everything he said on the campaign trail. All I see is more QE, more spending, more debt, less accountability.
Getting anything done ? Why sure he has ;
He’s diminished our global position with China filling in the void
He has every government employee on tenterhooks as he threatens to terminate millions of them
He’s managed to oversee more job loses in his first months in office than any previous president R or D all while claiming he’s created millions of jobs
He and his RNC sycophants are in the process of stabbing in the back the very people who elected him/them cutting Food Stamps , dismantling any meaningful health care etc
He’s in the process of giving the .1% huge tax breaks while increasing the tax burden on the working / middle / upper middle class .. making Reagan’s Trickle Down theory look plausible in comparison
He’s completely destroying any and all credibility coming from him , his staff etc
He’s turning the Whitehouse into our very own Banana Republic [ politicly .. not the clothing chain ]
etc – et al – ad nauseam
Begging the question … why are the RNC sycophants so thrilled .. and since when did they become this delusional ?
Hmmm .. kind of makes you wonder in light of their so called ‘ war on drugs ‘ what it is those RNC sycophants might be on / putting in their water .
Kasadour, I laughed out loud at your oh brother! Thank you.
You don’t miss a chance do you Martin? Democrats good, republicans bad, right? You sound like a parrot in evert post.
In case you missed it, his biggest lead over Hillary was in the 50k-70k income bracket. That is not exactly the food stamp populance.
I don’t remember any stories about the FED donating to Trump. Maybe you missed the answers Clinton had for her speeches to the banking cartels (like the one Obama just gave). When asked she replied “because they paid me”.
And where your blind assertion of Trump comes from regarding threatening federal workers, I have no idea. He had been President for five months, and federal facilities still do not have his picture on the wall. Maybe he is threatening them, I bet he is using those Russians. Those pesky Russians, I tell you.
And please tell me how eliminating deductions helps the rich, I’m just curious?
You can give up the whole ‘democrats care for the common man’ bullcrap. They just run from ethnic group to gender group making promises that conflict with one another.
I have my issues with Trump, and certainly with the Republican Party, but you need to get real too with your fanatical support of the left.
And please can we have financial articles where you don’t feel the need to inject your incessant complaints over Trump. It’s getting old.
In case this fact has eluded you which comes as a bit of a surprise in light of the fact that you seem to think yourself such an expert on my opinions comments and affiliations …
I am an Independent . Period .
So pray tell where do you come up with such erroneous unfounded and unsubstantiated assumptions when it come to my affiliations , comments and opinions ? Eh ?
FYI; In case this obvious fact has eluded you [ or perhaps you failed to read the article ? ] This entire article is all about Captain Chaos and the effect he’s having on the economy .. hmmm ..
You wrote: “FYI; In case this obvious fact has eluded you [ or perhaps you failed to read the article ? ] This entire article is all about Captain Chaos and the effect he’s having on the economy.”
Just to clarify, in case you missed it: The article is about consumers’ changing sentiment about the economy by party affiliation. It’s not about Trump or his economic policies and his impact on the economy.
Raymond – Hillary also came out ahead among low-income voters. In fact, she came out overall ahead by about 3 million votes. Everything Martin posted is God’s honest truth. We’re regressing toward a state the Republicans want, a sort of ante-bellum South, but nationwide.
I thought the T word wasn’t allowed here.
He has not forgotten EVERYTHING. I thinks he’s flipped on some and flopped on others but overall he is getting things done. I still on board.
That said, pretty soon we are all going to be in the gloomy category. This system can’t continue in its aurrent form. Too much debt and too many PPTs spinning their giant plates.
Posting on the fly. . .
What’s causing the “Trump bump” to fizzle That’s easy Reality
“But here’s the thing: hardly anything in the economy has changed in those months since the election”.
Remember the post Brexit panic. UK Bank stocks tanked immediately after the vote. I’m still sitting with my bag of popcorn and waiting for that calamity to play out.
This Libertarian leaning WolfStreet reader has to rate future economic conditions as going to get worse.
The USA has a static rate of GDP growth that is slightly under inflation. We have the Uber-elite gaining ground quite nicely, but: “Over half of the Americans spend every cent they make, plus some. They have trouble making ends meet.”
But most troubling to me is the out of control spending by Uncle Sam that has brought on a $20 T national debt. And according to the CBO, it will reach $30 T in nine or so years.
This is not the recipe for prosperity of the masses IMO.
There are readers who think the debt is no problem at all. It’s an illusion that the Gov (Fed) could just wish (print?) away.
WR has tried to point out to them that Gov debt is held by individuals, pension funds etc. etc. and they expect their money.
Then there are the readers who think the Fed should just buy the world with dollars (honest)
For some reason the Guardian is also well supplied with commenters who think this or that monetary tweak will solve all problems.
They are quite derogatory about the idea of balanced budgets.
One term for spending within means is ‘handbag economics’
I wonder how many of them are being supported by a handbag.
In a nutshell Republicans depend on the private sector and Democrats the government. Trump wants to reduce governments share of the national economy and the regulation of it. Bad news if you are a public employee, beltway bandit or NGO/non profit.
Farmers with government crop subsidies – all democrats! For profit fake colleges with government backed student loans – all democrats! Owners of bailed out banks, insurance companies and car companies – all democrats! real estate agents – all democrats! arms manufacturers and mercenaries – all democrats!
What percentage of the $1.3 trillion in student loans goes to ‘for profit’ schools and of that what percentage of students attending those schools are minority Democrats?
I’d suggest the student loan scheme is simply a back door subsidy to left wing academics. We could do a test though. Require schools to ‘cosign’ to receive student loans and you’d see a huge drop in enrollment as schools either closed or weeded out unqualified applicants.
As to agriculture. I’m ok with ending subsidies for food products of which, by far, the largest is the SNAP/Food Stamp program followed by public school feeding centers. Of course if that happened whose political base would starve?
Kaplan is the big private school bought as a flyer by the owners of the Washington Post, which then more or less saved the WP.
Don’t know about today but most of its income was from Gov student loans and not too long ago over 40% were in arrears or default.
BTW; the largest single ‘asset’ of the Fed Gov is the student loan book.
Wonder what Goldie would give for it?
“…the largest single ‘asset’ of the Fed Gov is the student loan book.”
This should read: the largest single ***financial*** asset…
I’ve always thought it odd that you can’t sell a dangerous ladder, but you can sell a worthless degree.
If we insist upon regulating the market, those regulations should extend to universities. Ironic how they worship regulations, but never state more are needed to protect students from predatory university practices.
Oh, please, stop with the stale “left-wing academics” trope.
Where are these people? In the Humanities departments that are being closed/shrunk/consolidated as a corporate model fully takes over higher education? On the op-ed pages of newspapers no one reads? Among the 75% percent of college faculty who are adjuncts, at-will temps, cobbling together a barely-subsistence livelihood?
Unmindful glibertarian groupthink on display there, totally removed from facts and reality.
Duke de Guise – Exactly. Professors/”Academics” are hurting bad these days. Tenure is very difficult to get, and more and more teaching is being done by “adjuncts” which is a fancy word meaning degreed temps making $12 an hour or so.
Who’s cashing in is bureaucrats, people who it’s hard to put a finger on like “head of the English department”, people with “gray” names and titles. And, the sports departments which get obscene amounts of money.
All over the radio where I live are the usual stories of corruption in the University of California system, an incredibly corrupt system. (Remember they’ve long had racial quotas, and if you’re white God help you if you want to go to a UC school – unless you’re good at football or some other sport then you’ll be tolerated.) The latest is the Regents hold lavish dinners that cost umsteen-thousand dollars a pop and they just bill the UC.
Trust me Mr. Left-Wing Professor is hitting up the home ec. department for new ramen recipes; he’s not cashing in, the very few of him that are left. Hell, I had one of those guys in college. He was always going on about the rich and the poor, how groceries – necessities – are always cheaper in the rich neighborhoods etc. “If you’re rich, you’re gonna stay rich; if you’re poor, you’re gonna stay poor” and so on. And wouldn’t you know it? All those things he said, that kinda pissed me off at the time, turned out to be 100% true.
Thats the alt facts / myth Mr G .. here’s the verifiable public record reality
1) All farmers including gentrified ‘ hobby ‘ farmers receive government subsidies .. with the majority of them including the ‘ gentleman ‘ from Kentucky being hard core dyed in the wool R’s
2) For Profit colleges and universities for the most part are a creation of Republicans .. as are for profit Charter Schools etc
3) The overwhelming majority of Banks Financial Institutions and Insurance companies are NeoCon conservative R’s
4) All the US auto manufactures heads CEO’s C alphabet soups and boards are overwhelmingly … R
5) Real Estate Agencies ? .. the majority are once again R
6) Arms manufactures … most definitely and in fact absolutely to the core …. R
Begging the question ; A) Are you being sarcastic ? .. or B) From what alternative universe do you gather your information from ?
Not from the procustean bed you are ‘lying’ in.
I won’t bother to do a point by point refutation of your post. You lost me when you said ‘gentleman farmers’.
it was a sarcastic response to Unit472’s observation that “republicans depend on the private sector”. your point is exactly my point.
So much for the vaunted, illusory “recovery.”
Are you forgetting all those folks emerging from the basements to brew beer?
The Democrats I know are spending…and on big ticket items and buying the FANG stocks.
The Republicans I know are not spending at all.
May be it is just in Florida….may be not.
I’m a Republican in Florida. I make decent money and I’m not spending at all. Of course I’ve trained myself not to want a whole lot, and I already have everything I need.
On the other hand I’m not all that partisan. I don’t think the President has much influence on the economy one way or the other.
I’m a Republican / Libertarian in California. We will never take out a loan for anything on principle, and are extremely frugal. Our running joke is that we are too busy making money to spend money.
Almost all our friends are Democrats, some lean Socialist. Several have made major purchases recently – houses, cars, etc. paid for by loans. Someone made the observation that all real estate agents seem to be Democrats – seems true in CA!
Funny but sad side note: I have a difficult to pronounce name so I always just show people my driver’s license – at the voting booth, I was yelled at for pulling it out! That’s California in a nutshell, better to be PC than practical.
I’m Canadian and I’m amazed that all you guys have people classified like this. I can sort of understand the type who has friends who lean left or right ( I have friends all over the spectrum) but this stuff about one type of voter gets loans and another doesn’t seems, to be polite, nonsensical.
I can pretty much guarantee you that typical new car financing shows equal distribution between R and D.
I don’t get it, either. It’s become just like any other team sport, where party comes before country, and nuance is evaporating. I’m an independent, although I tend to vote for democrats as the lesser of two evils, because they’re primarily the centrists now days.
“but this stuff about one type of voter gets loans and another doesn’t seems, to be polite, nonsensical.”
It is utter nonsense.
People build up bubbles for themselves where everyone like them is great, and everyone not like them is responsible for all of their problems. Doesn’t really matter the topic, doesn’t really matter the political ideology or affiliation. And it’s getting worse.
All it takes is the slightest bit of introspection to realize you are doing it. Here’s a hint: whenever you think some massive demographic of diverse people all think one way, all behave one way, or are all responsible for some complex issue… you’re almost certainly (A) wrong, and (B) woefully ignorant about whatever topic you are waxing poetically about.
So when someone says “All my friends are Republicans, and they all hate the poor and want lower taxes” or “All my friends are Democrats, and they’re lazy and want more welfare” you can safely stop reading and be assured that this person has no clue what they’re talking about. Generally it’s not worth engaging this person at all, because arguing with these people is more likely to entrench their beliefs, even if they are objectively wrong.
Whoa! “All you” is a sample size of three comments. Why is it nonsensical to think there might be a correlation between political philosophy and how one manages personal finances? I can only speak as a Libertarian really, but it is a basic tenet of Libertarian philosophy to be fiscally prudent, and ANECDOTALLY, a lot of Libertarians I know don’t like to take out loans.
Because we have friends all along the political spectrum, it was simply an interesting thought exercise to realize that among my friends, those that have made big purchases recently lean left, while those who lean right are more cautious about spending these days. This is especially interesting given the data cited in this article about Republicans’ apparent positive consumer sentiment.
I only mentioned ‘party affiliation’ because this article pointed it out. It is now a near disease in America, proclaiming your ‘leaning’.
However, I stand by my comment and the people…especially my Democrat friends are not happy unless the make this point ‘party affiliation’, very clear and what they are now buying.
Me, I have no affiliation, but I am not spending either…unless it is for vacuum tubes !
When I vote, I vote for the person’s ethics and history, not any party.
Yeah the whole “consumer confidence” thing has really lost all value as a metric now that people are using it for partisan signalling purposes.
Having outed myself as a Trump supporter early on, with the scars to prove it, I shared in the increased confidence of his election and still do, even though my income has not gone up. It feels better to have someone in charge with some concept of how to manage money. And don’t forget what the alternative was, Mrs. NAFTA | Globalist | Uncontrolled Immigration | Identity Politics | Sleaze Bag……..
I voted for Trump too, even though I suspected that he was a film-flam faux populist. But the alternative was Crooked Hillary, the embodiment of the corrupt, crony-capitalist status quo. A vote for Trump was a vote against the same-old, same-old that the Republicrat duopoly keeps giving us as “choices.” Throwing a monkey wrench into the gears by voting for a buffoon like Trump who at least said some of the right things was the only effective protest and a middle finger to the Establishment politicos who are aiding and abetting the .1% corporate looting of middle America.
The Trump slogan should have been “Vote Trump: What have you got to lose?”
I think that was pretty much implied.
You are about to find out
It felt so good sticking my middle finger in the air that day! Speaking metaphorically of course ;)
Yet the Republicans can’t grasp the concept that those voting for Trump were not voting in support of the R’s as much as they were voting against both political parties. I am one of those who voted that way and most people I know voted that way as well.
The latest from Trump ( apart from confefe)
“Our tax bill is making progress moving through Congress”
There isn’t one. He hasn’t sent one to Congress. He can’t keep his stories straight.
Trump supposedly ran against elites. This is someone who has spent his entire life catering to elites and desperately trying to be one. He has never had any time for ordinary non-elites.
This is not Mr. Smith goes to Washington. This is an insider who brags about making contributions to prosecutors (see Pam Bondi) ‘so when I call they are there for me’
To make matters worse, he’s like a quarterback who doesn’t do huddles. The ball is snapped, he throws deep- there is no one there.
So he blows up at the surrogates-‘why weren’t you there to defend my message?’
Because they never know what he’s going to do or say next.
I’m sure things will get much better with all those coming changes: privatised schools, proposed cuts to medicaid but no medical bill, no budget plan passed, no tax reform, withdrawing from climate accord.
I read this set of comments this morning:
For every three dollars China spends on defense, it spends $1 on renewables.
In the US, for every $41 it spends on defense, it spends $1 on renewables.
China Leads the Charge on Clean Energy | The Cipher Brief: “America’s regulatory framework is going to try and reverse the tide of what to me is an inevitable technology-driven transformation; it might have a short-term stalling effect of that transformation in the American economy, but I think it won’t change the outcome, it will just transfer the benefits away from American industry towards China, and also India, as those two countries continue to accelerate their transformation of their economies.”
“I think China by stealth and by strategy gained global technology leadership: they have built or bought the best technology in the world, they also have the capital funding availability, and the policy clarity to drive that technology leadership. It’s about investment, jobs, and exports. It’s about global industry dominance for industries of the future. When you look at the Chinese government, almost every external decision they make is about going global, the One Belt One Road policy is about going global. You have a very clear long-term policy framework, and state-owned enterprises are rapidly implementing that policy, and they’re doing it both through acquisitions and greenfield investment.”
Surprising developments in China, India could blunt Trump’s climate rollbacks: “The results of the Climate Action Tracker’s report are bolstered by findings from a Center for American Progress analysis of China’s coal consumption. The report makes clear that the argument that China’s emissions would outweigh any progress made in the U.S. is, at best, outdated, and more accurately a zombie argument.
As David Roberts writes at Vox, China is taking on coal head on by shutting down older, more heavily polluting plants in favor of newer, more efficient facilities and renewables. It is also planning for a non-coal future based on renewables.”
And what does Trump want to do? Bring back coal, of course (for a few votes in mining country). I for one like the ‘good ‘ole days’ as much as anyone, but coal? This is what Empire decline looks like.
You’re 100% correct. The upside is that the US will soon be an economic backwater and won’t need to generate a lot of electricity because there won’t be many jobs. And folks won’t need to drive to non-existent jobs.
So the US will meet it climate change needs regardless.
I was in China in April. Supposedly not even a terrible air quality month, but the air quality was pretty bad. Didn’t see blue sky once the whole week, and I noted when I flew out that the clouds beneath looked black and gray until we were past Japan.
China spends on renewables because it has to, and at the same time, anyone in China with money wants to move to the US ASAP (for lots of reasons). No matter how much they spend on renewables, a large portion of that gets siphoned off by corruption. I doubt we will see air quality in China get better any time soon.
Exactly. I had to laugh reading that comment about China “leading the charge on clean energy”.
Spot on. I always enjoy your comments. I invested in stocks in some alternative energy financial companies in India – mainly solar and wind. India is set to become 40% solar in 2022 – eight years before target.
Today, in India, solar is cheaper than most other energy sources.
Any positive changes for the average person in China or India will come from the bottom up. I still can’t get over the fact we are importing H1B tech workers from India, when they can’t even roll out a new currency in their own country.
I agree the alternative was pretty poor but what’s with this “lesser of the two evils” stuff Don’t we deserve better?
Well, the Republican Party primary started out with ten credible candidates to choose from, only one of whom was the eventual winner, Trump.
So, I guess “Pogo” (Walt Kelly) was right: “We has met the enemy and they is us”.
You’ve got a funny idea of “credible.” All of the Establishment GOP clown car occupants were the same guy: neocons, corporate statists, and Wall Street stooges.
Same-old, same-old, in other words. No thanks.
You’re 50% off the mark. I believe there were 15-16 candidates, and as Gershon noted—only 1 was credible, the winner.
“It feels better to have someone in charge with some concept of how to manage money.”
Hahahahahahah. I won’t even go there, but thanks for the laugh.
I think you know better, Petunia, if you’re saying Trump knows how to manage money. He’s lived a life of bankruptcies and money laundering while being born rich in the first place, and, if you think that Mrs. Clinton is more of a sleaze bag than Donald Trump, then Russian internet trolls have done a better job than I realized.
I’m sorry to be so direct, but I consider you to be a voice of reason and insight around here, so I’m frankly shocked by your post.
Agree with the money management part but the whole Russia “hacked the election” or “stole our Democracy” is such an abstract farce and media assisted dark fantasy that it’s hard to believe so many are duped by this. BTW, at what point did anyone in the Democratic party address the issue of knowingly abetting the Clinton campaign while destroying any hope for Sanders to get the nomination. This country deserves Trump.
I actually think that the way Trump handled his way out of the Atlantic City bankruptcy was brilliant. He got out of it by forcing the bankers to lend him even more money and managed to pay them back on his own terms. Having worked for some of the major banks and brokers in NYC, I KNOW what an amazing fete that was. He out mastered the masters of the universe and he’s done it again.
Hillary’s ties to Russia run a lot deeper than Trump’s could ever hope to be. I think that will be the finding of the special prosecutor, if he doesn’t lose his nerve.
I’m not bothered by your voting for Trump (I very grudgingly voted for Hillary, fwiw) and everything you say about Ms. NAFTA is true, but to say that Trump has a “concept of how to manage money” is preposterous, given his numerous bankruptcies.
With some of those bankruptcies he’d personally guaranteed a lot of the debt; the only reason he wasn’t wiped out was because the banks carried him along and provided forbearance.
The man is an expert self-marketer and salesman, and a political idiot savant (and I mean that “respectfully,” as a lifelong New Yorker who’s been observing him for over forty years) but having inherited a substantial fortune, come within a hair of losing it all – at one point Daddy Trump went to one of his casinos and bought millions of dollars of chips that he had no intention of using, so that Donnie could make a debt payment; don’t you just love those rugged individualist, self-made types? – and thereafter merchandising a lot of sketchy stuff under his brand, he gets gets far more props for his business smarts than he deserves.
Yes, a vote for Trump was a vote for a wrecking ball to clean out the DC swamp. Bush, Clinton, et.al. would have been more of the same. We haven’t had a very good president for about the past 24 years.
My take on the Clinton years is very different from the popular media’s: 1. he was handed the “peace dividend” (remember that one?)
2.he was handed the tech bull market
3. which he parlayed into blowing the Dot.Com bubble; the remnants of which we are dealing with to this day.
4. Bush came into office with a recession (start date has varied over the years)- remember that? (probably not- most people think Clinton’s terms were bliss- they amounted to handing the US several ticking time bombs)
5. Obama? meh- lost opportunities abound at best.
the political class has allowed their paymasters to eviscerate the once great American Middle Class. Formerly the the envy of the world, they ve been screwed by the financial sector with their catastrophic housing bubble, for which they were rewarded, but which caused home ownership to drop back to where it was in 1967. So many never recovered;-but those at the top are oblivious.
In health care, prices were allowed to rise to the point where people were bankrupted by serious illness; the govt s solution was to create a system
where the middle class was obligated to buy health insurance from an industry that was allowed to merge into oligopoly and double premiums; people couldn t afford to pay deductibles if they needed care and were screwed even before they got sick.
A student loan program of easy tuition money drove up tuitions (much as sub prime/ liar/ govt guaranteed mortgages did with house prices.)
Then it was all rinse n repeat with subprime car loans, while the people running the economy were allowed to drive up asset prices so the investor classes doubled their assets and threw money at real estate, and other asset classes.
It s funny in a way: All these ‘brilliant’ ivy league piggies forgot we were a consumer economy, that our economic strength was based in our highly mobile, resourceful and small scale entrepreneurial middle class.
The political class turned into the whore of the highest bidder, ignoring the way their concessions to the financialist corporatist elites, who wine and dine them, were destroying the lives of middle class families.
-Sorry, buying off the politicians to be allowed to screw people isn t brilliant, it s just garden-variety banana republic corruption.
So now we can t afford basic amenities: Forget Walmart; the thrift shops are jammed, hordes of homeless people are skullking in the shadows of empty downtown luxury housing turned investment.
The govt s solution: make up fake employment figures, artificially drive financial markets ever higher, and pretend retail collapsed first because of the weather, then because everybody s shopping on line.
Do any of these self congratulatory elitists even stop to wonder what the Wells Fargo 2 MILLION FRAUDULENT ACCOUNTS criminally set up to extract fees from the poor meant: I d bet thousands if not tens of thousands of children of working mothers went without a few meals: those $35 and $75 fees take grocery money from the working poor while a teensey tiny minority of utter pigs mull over whether to upsize the private jet, or to throw 20million at an art work, or replace a 5-year old kitchen.
And the mainstream press is quiet except to try to rouse people up into believing one or the other of the hideously corrupt political parties is somehow going to fix, or otherwise is totally responsible for the mess both have allowed to fester.
They re corporatist / statist too.
The elite s solution: eliminate cash and force people to be screwed even further by an utterly emboldened criminal banking cartel. The politician s solution?-appoint these same to set economic policy.
Golly Madge! I wonder why people aren t all confident and out shopping?
Wonder how all that bad subprime auto, housing, corporate buyback and student loan debt, all ‘securitized’ and sold off to yield- desperate pension / retirement fund managers during a 8-year zero interest rate strategy will hold up…when it drops to pennies on the dollar and retirees are screwed they ll again tell the former middle class they have to bail out the financiers, then the fed will print money / debt and they and their TBTF cronies will buy it up for nothing and sit on it til they ve inflated another phoney bubble n dump it for a whopping profit; as they ve just done with the mortgage backed securities…it s sad….and I m afraid they re setting up an ever more volatile social situation of hapless have-nots…so maybe the question isn t ‘are we the next Japan? but rather are we the next Argentina?…………………or Venezuela.
Your summary of the sell out of America to the corporatocracy is right on.
Perhaps this will go down in history as the greatest failed experiment of neo-liberalism? But who am I kidding? It does not matter since history can be re-written and the mass will promptly forget.
I read “Wealth and Poverty” by George Gilder back in the 80’s and the most important finding in the book was that the wealth of America was not in corporate America, but in the American family. That book, and its revelation, was what unleashed the predators on American working families. The job, the home, the savings, the pension, everything that comprised the wealth of America was taken.
We elected the people that did this to us and we keep reelecting them. It was all of them.
“We elected the people that did this to us and we keep reelecting them. It was all of them.”
Right on, Petunia. Once again: “Pogo” (cartoonist Walt Kelly’s creation),
illustrated with wooden sword in hand: “We has met the enemy and they is us”.
Same thing has happened to the middle class in UK. Same thing, may be even worse, is with housing and credit bubbles.
In US you have production/tech, but here it is just services economy…
“And those with extra money to burn or room left on their credit cards, well, they have not yet stepped up to the plate either.” – Wolf
…and some of us never will.
Regardless of current events, perhaps of greater importance than a U.S. Presidential election outcome, spending (and all other decisions, for that matter) are controlled by the drummer we march to, not the ones keeping the beat for a political bandwagon.
I know I won’t Been there Done that
Same here !
Despite what our Soviet-style economic statistics purport to show, I do not see “rip-roaring” job growth in my community.
Other than demonstrating the utter uselessness of something called the Economic Confidence Index, I don’t get the point.
Why are Americans so willing to let these clowns tell us what we supposedly think?
I think these consumer sentiment surveys are useful for all kinds of things. But they’re NOT useful in predicting consumer spending. Unfortunately, that’s precisely what they’re often used for in the media… “Consumers are feeling good, so spending must tick up.” But that relationship is very tenuous at best.
The real purpose of consumer sentiment surveys is to measure the effectiveness of corporatist and political propaganda.
It takes a long-term campaign of well-designed messaging to persuade people to think things are pretty good even while the US economy and most personal finances have been seriously deteriorating for years. And as expected, the evidence shows Rs are far more susceptible to that messaging.
The poorer demographic among R supporters has been seriously harmed by the success of Republican agenda and would be further devastated by the success of Trump’s agenda. Nevertheless they are still expected to continue to support Rs and Trump as a result of effective messaging. A preponderance of evidence shows that it is perfectly feasible to get people to vote against their own interests, given the right propaganda in a conditioned population.
All those people in the South who went on SSDI when the plants closed – whole counties in some states – may have a big surprise waiting for them if and when the program is truncated. And they may never understand how they did it to themselves.
Maybe I should feel sorry for them. But I doubt it.
Walter: Great insight into understanding the real purpose of consumer sentiment surveys. Thank you.
US Economy is 70% driven by consumer spending.. if the spending dries down… then the economy is on trouble.. right now spending is fueled by cheap debt.. but for how long ?
with obliteration and outsourcing of jobs along with high cost of living in USA, there is not much money left for discretionary spending..
Despite the fact that I earn $200k/year I am tight wad.. Usually do need vs want test whenever I buy things.. keep myself in topnotch health… and am not too optimistic
This survey shows us something else, very sad.
American is becoming so hopelessly divided along Partisan lines, that it has no hope of establishing a consensus on anything.
With this sort of Partisan division, no country can become, return to, or maintain, its greatness .
That’s before you look a racial divides/conflict’s that compound the Partisan issue.
Trump is effectively handing the global #1 spot to CCP china, on a plate.
Mutti Sounded the death knell of the global order (and NATO) since 1945, then walked it back to play nice.
Mutti does not say something like that, and not mean it.
If the Eu does not strt playing nice of brexit. The British electorate is going to demand that Britain. STOP paying into NATO, to defend a Europe.That has kicked them in the teeth over trade and is being difficult, because it can.
Wright or wrong, that’s how the Ukippers and Brexiters, will present it.
I don’t believe you wanted this Thread/Article to turn into the Partisan bun fight it has. So I have abstained.
Can you elaborate on the death knell of the global world order. My view being that eventually there will be a global government. I would agree the U.S.- free market model is threatened, probably being replaced by a China dominated model for the partisan reasons you pointed to.
“Can you elaborate on the death knell of the global world order.”
“Mutti Sounded the death knell of the global order (and NATO) since 1945, then walked it back to play nice.”
It always pay’s to view any statement as a whole. (other wise you move into the area of News Makers crimes of deliberate miss-quotes)
“Mutti Sounded the death knell of the global order (and NATO) since 1945,”
Mutti, Staed (words to the effect) Europe is alone and must defend itself now.
Mutti stated” europe can no longer rely on the Atlantasist Position” (Words to that effect) I am to lazy to look them up
“The Atlantasist position” being the western alliance post 1945 and 1949 backed by America and its nuclear and non nuclear forces. Which includes NATO.
After D)(&P refused to iterate his support for NATO article 5 which is the “an attack on 1 is an attack on all” doctrine (used by the US to get NATO involved in Afghanistan, Among other places) and Lectured NATO members like naughty school children. About financial commitments not honored. Suggesting if they dont pay the US wont play.
Or as another put it, a Mafiosi protection racketeers “nice territory you have there hate to see anything happen to it” as you aren’t paying.
Mutti is coming to the end of her term, and Career. If she gets reelected. It is highly unlikely ,she will retain the positions of chancellor, and party leadership, to the end of the next election cycle.
Heart is speaking a little more frequently, than in the last 20 years.
IMHO the only thing preventing a Massive dumping of the US, and its $, at this point in time, is there is no other currency worthy of replacing the US $.,
P45 is fast making CHF and Sterling, look very attractive again.
china is pushuing HARD for more trade to be settled in CNY/RMB. That as a dangerous game for other than the chinese as that means holding CCP china printed used toilet paper even if only for the transaction time.
CNY/RMB is still less than 1% of global reserves, and that is to high.
Thanks for your response. You make some interesting points. I see a lot in the news about all the interconnections between Pres. Trump and his associates with Russians and it does seem an attempt at realignment. I don’t understand the corporate and market response as they’re the beneficiaries of the current system. One thing about the current political environment I see, and I’m not trying to defend Pres. Trump, is the parallel between the R’s attempt to discredit Pres. Obama after his election and the D’s attempt to discredit Pres. Trump.
“One thing about the current political environment I see, and I’m not trying to defend Pres. Trump, is the parallel between the R’s attempt to discredit Pres. Obama after his election and the D’s attempt to discredit Pres. Trump.”
Only a partisan, or very biased fool, would attempt to deny then above.
However P 45 has done so much more, that is probably Highly illegal, since he has been Inaugurated, and before, that the investigation by Muller, is more than justified.
I try to stay away from this thread it has turned into a partisan political bun fight/Mud slinging Match.
You answered directly, so Manners demand a restrained reply.
By golly, those who went to Trump University are racking up all those margin trades. All the best to them.
People are WV and Kentucky are waiting for their coal jobs to come back. My Republican farmer friends in Idaho are worried about their subsidies.
Dodd Frank is being dismantled here. Meanwhile India is poised to meet its 2030 solar power targets by 2022 and the Reserve Bank of India is getting ruthless with banks holding bad debt, threatening to shut them down.
India has to export their best and brightest because they can’t employ them. They can’t even educate most of them. The roll out of their new currency has been a high tech disaster. Whatever their official line might be, I don’t believe it.
You don’t have to. I visit India every year and see what’s on the ground and talk to people. I also heavily research the Indian companies I invest in.
1.2 billion and growing.. India is extremely crowded and polluted. Trash everywhere and lots of extreme poverty. India has to export its educated because there is no room for them in India and the world doesn’t want the uneducated. India’s exportable resources are people.
You may invest there and good for you. Labor is so cheap there they even dig up the streets with hand labor.
India is what the planet will look like if we continue to try to have exponential growth in a finite system.. Go see for yourselves to understand.
My father spent 50 years at sea, went to every country with a coastline more than once. He told me to stay out of two places, India and North Africa(not including Egypt). He told me stories that disgusted even the most hardened sailor.
You do realize that the lawsuit against Trump U was a political ploy. If he hadn’t ran for POTUS, the lawsuit would have gone away with nary a sound from the MM. There are tons of worse “real estate education” companies out there running around unfettered.
Don’t recall the media getting into a fenzy over these companies
I thought those suits were filed before he was the nominee?
And of course there will be media attention – that comes with the job.
Most shysters steer away from public office for this reason.
People who aren’t guilty don’t settle for $25mn or make racist attacks against judges.
“People who aren’t guilty don’t settle for $25mn or make racist attacks against judges.”
Or try to intimidate FBI Directors, they have just fired.
It is amazing how deeply entrenched partisanship is in the US. It’s no longer about hard evidence and facts. People fortify their beliefs and ideology with confirmation bias and “information selfies” (e.g. getting their news on Facebook, which intentionally feeds news that conforms to and comforts one’s original point of view).
Interesting article from FT showing how US collected tax receipts have been declining for 3 yrs m/l… https://ftalphaville.ft.com/2017/06/01/2189479/falling-tax-receipts-pose-a-debt-ceiling-dilemma/
Further on in the article shows how (by GS) that withhold taxes have increased… Makes me wonder a couple things. Are the wealthy and the corporations already paying less.. and then if tax receipts are declining and the deficit is still growing and scheduled to grow more, Who is going to pay for it? Then factor in more tax cutting? And more military spending? How can this possibly work?
Middle class is always and all ready to pay more taxes to subsidize freebies for poor and support life style of rich
We The People pay for it. Check out IL property taxes for instance. A poorly run state. The average every-day person pays for these blunders. The ones who voted for it (Chicago) leave and mess up another city/state. The Everyday Man pays for it!
1 thing I see happening, is cheap (Almost dumps) rented out, just out of city limits. With very expensive motor homes. Parked on a part of the land not controlled by the tenant. But connected to the services of the tenanted property.
For younger or older people, with no children, this is not stupid.
And it makes holidays much cheaper.
I you dont like paying taxes, do something about it.
I don’t live in IL nor do I live anywhere near where motor homes are parked in front of dumpy houses.
Then pay the ever increasing tax. And dont cry about it.
I was talking about IL, not my fiscally sound state. Another high-tax state I think of is CT (Exodus Pt. 1). Both states have HIGH property taxes. Look what you get in CT (lots to do and see! [not enough for me, however]). And then look what you get in ILLINOIS (I’ll clue you in—corn fields). So, like I said—fiscal irresponsibility (double the rates of their neighbors!). You were saying?
P.S. You need to brush up on your reading comprehension skills.
This entire thread of comments is confusing. I was under the impression that Tr(ump) was not up for discussion (partisan politics).
That said, he (whom i shall not name) hasn’t been in office long enough to affect any meaningful economic reform. His agenda is stalled in part, but not everything.
I voted for him, not because I really believe in MAGA, but because he seems to be the only one with the experience to successfully guide America through insolvency/bankruptcy.
Just because the FED can and does expand its balance sheet doesn’t mean the federal govt is paying off its debts.
I do not fall in the category of economic optimism because I voted Republican. I am getting by, my family runs a BMW/Merc. sales and service center in the Pacific Northwest. We do ok. We have employees. But for how long? esp now since after-market vehicle sales are collapsing. dark (economic) days are coming.
Your family runs a Merc center and you voted for a guy to take the US through bankruptcy?
Are you f7cking kidding me?
Remind me not to sign up for your warranty.
Amazon is just about $1000 per share…FAANGs, tesla plus many other are records highs.
Tons of employees of these companies getting richer by the hour…
Meanwhile ya’ll talking about sears and apparel and bubble…
It sucks to just be a sucker working on salary and getting rent increases. haves and have nots more than ever.
Yeah. It would have been nice if the Fed simply told everybody it was going to jack up asset prices, in terms average citizens could understand, so the little guy didn’t get impoverished in the process. The Fed takes our money, then speaks in a cryptic language only rich bankers like Goldman can understand.
A truthful Fed would have basically said “We’re going to create a debt and asset bubble. Invest now or forever hold your peace. Don’t worry, we will keep the pedal to the metal until there is 4% GDP growth or the debt bubble crashes. We don’t know which will happen, but you might as well invest because if this thing explodes we’re all dead anyway”.
But with hushed whispers of russian involvement and impeachment in the background does the american consumer have reason for some temporary pessimism?
In theory we have a secular government, but in reality the moral stature of the president is important, whatever his policies might be. We’ve had a few presidents whose ethics we can admire (Thos. Jefferson, Jimmy Carter) and others who were totally sleazy (Nixon, Clinton, Trump). Trump does not appear to have any policies at all, if by that we mean a deeply thought out, philosophical, coherent view of the world; he seems to be more of a fount of spontaneous randomness. It may not be his (non)policies that bothers the Democrats so much as the dreadfulness of his person, which is destructive of morale, and therefore of economic sentiment.
‘It may not be his (non)policies that bothers the Democrats so much as the dreadfulness of his person, which is destructive of morale, and therefore of economic sentiment.’
Should it bother non- Democrats ?
“Millionaire confidence plunged by a record amount in May, sparked by fears of government dysfunction in Washington, D.C…
The political pessimism among millionaires is not being driven by Democrats, which would be predictable. The largest drop in the survey came among Republican millionaires.
The Republican millionaires may believe they delivered the House, Senate and Presidency and still nothing is getting done, which ultimately may impact their economic views. They are worried that government dysfunction, which they identify as the most significant threat to the economy, could jeopardize both health care and the important tax cuts that may be fueling part of the stock market surge …”
The national debt has not impacted us like it should because it has for much of it been sterilized to lessen the inflationary impact.
1. much of this loan money as been used for speculation on the stock market-bank trading and hedge fund trading.
2. Another large portion of the money was given to the bank wealth management groups to “invest” over seas for plunder and profit. There, the impact of these dollars has been severe on the local economies causing inflation the 20’s and up ( Brazil-ex.)
3. Our reserve currency ( the dollar) allows us to “tax” the rest of the world in varying degrees
“Our reserve currency ( the dollar) allows us to “tax” the rest of the world in varying degrees”
Spot on, past empires used colonies to siphon resources from the world, we have petro dollars to do that for us, back by the military might of the US.
I’m definitely independent; but one thing I do like about Trump is the fact that he is stopping all the non-sense about giving people free money. When people get free money, free stuff, it degrades the wish to work.
Sometimes in apartments that I live, I see people who don’t work at all, and I always wondered how they can afford to live in the same apartment as I do, and the answer is chapter 8. These days, people who work hard have been turned into suckers. Why work when you can make a decent living not working and spending all your time on pleasure? How many single moms do you see who haven’t worked in years, yet can bring their kids to Starbucks and then sit and chat for hours on their iPhones? Why should I subsidize lazy people who don’t want to work?
Yes, it’s wonderful to see hope he’s cut off the “free money” to Wall Street, and to see all those rugged individualists there become “job creators.”
Sorry, “… wonderful to see how…”
Are these non-productive Moms any different than bankers who chat on their I-Phones, fully supported by fee money from the Fed? A suit, tie, and some fast talk doesn’t mean they aren’t free-loaders, and those deadbeats get far greater handouts than the Moms. Plus, they pay only 15% tax, about half what you and I pay.
Of course the real bankers, and I’m not referring to one of us little people working as a teller or as manager of a branch, are far far bigger a free loader than a 10000 jobless single moms , but find one politician who would go against them.
That said, I’m still tired of giving free money to people. For example, if they stop chapter 8, rents will drop like hell; that will have a great effect on all these free loading companies which have purchased thousands of homes to rent. Free unlimited medicare means anyone who is on medicare will go visit a doctor as soon as he/she wakes up on the wrong side of the bed. There is so much waste just because government borrows trillions, and hands them free to these people.
By the way as long as we are on the subject of free loaders, don’t forget the defense companies; they are as much a free loader as the bankers.