"We are Better Off than We Would Have Been with Hillary"
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"We are Better Off than We Would Have Been with Hillary"

But, Trump is risking an economic disaster like no other.

All Americans invested in the stock market have been compelled to believe that we are better off because of the election/Russian installation of Donald Trump as President. It is a common refrain since the stock market began heading for the races in early 2017. It has become a common retort of those who support Trump. And, it has basically been true. The economy was in a good place when Obama left office. However, the removal of legislation – environmental and the like – and the passage of tax reform designed to benefit corporate America (to the detriment of our government and social welfare programs in the future) have basically sent it screaming higher. It has moved so nicely that Americans have had no problem turning a blind eye to the injustices and outrages around them.

However, this phase is about to turn. In a very short time, we are going to be saying we would have been better off with Hillary. The grossly mercurial one has been compelled by Peter Navarro to stir the hornets’ nest of economic sanctions and tariffs and it is going to result in a self-inflicted wound of epic proportions.

Affixing sanctions to products produced in China is going to cause a noticeable uptick in US inflation as consumers of the end products (purchasers of the inputs) will choose between purchasing the Chinese products at a markup or alternative products at a higher cost. Since China has been forced to match our tariffs, we will soon see, as well, a lower demand for US products in China. And, most probably, we will also soon see even higher prices of products produced in China with US components and then exported around the world. Because the Chinese will dramatically reduce their purchases of long term US bonds, as well, we will also see all sorts of unintended consequences in global financial markets.

Unless this trade war is rolled back and rolled back completely by the US in a few short months nobody will still dare to say that we are fortunate that the Russians gave us a President Trump.

Ari Socolow
Ari Socolow: Ari Socolow is the Chief Economist and Editor-in-Chief at BestCashCow. He is particularly interested in issues relating to bank transparency and the climate crisis. Since co-founding BestCashCow in 2005, Ari has been frequently cited in the media as an expert on local and national savings accounts, CD products, mortgage and loan products and credit card rewards products.

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