The Law Of Unintended Consequences

It’s hard to defend the actions of the Federal Reserve right now. The people who propped up the economy under President Obama seem determined to destroy the economy under President Trump. But we know that the Federal Reserve is apolitical. Sure we do. However, there may be some unintended consequences of the current Federal Reserve actions.

The Gateway Pundit posted an article today which explains some of those consequences.

The article reports:

The Chinese were relentless in their efforts to obtain Western technology and grow their economy.  They set up trade barriers and manipulated their currency in ways that helped China. The US was at a disadvantage in trade resulting in massive deficits into the billions.

Along comes the Trump Administration, the first administration to address China’s unfair trade advantage.  President Trump is a shrewd negotiator and he obviously believes now is the time to encourage China to make changes to their trade barriers with the US.  China may have no choice but to go with what the US offers to keep its economy afloat.

The more pressing issues for China surround real estate, in a manner similar to the US in 2008.  As China grew, it invested in its infrastructure and in addition it invested in large housing projects throughout the country.  These efforts helped bolster China’s already fast growing economy.

The problem is that China over invested in these random properties all over China and these properties today remain empty.

…Now to add to China’s misery, the Fed is doing all it can to kill the US economy.  China is dependent on the US economy to stay afloat.

…The US debt now stands at $21.8 trillion. A 2.25% interest increase on this amount of debt is an annual increase in debt interest payments of $500 billion!!!

The Fed is doing all it can to destroy President Trump’s economy. What the Fed doesn’t realize is that a flat US economy means disaster to the Chinese.

China’s financial crash may make the 2008 crash in the US look small.  The implications will no doubt impact the entire world.  Jerome Powell at the Fed has no idea what he is doing!

Hang on to your hat, if the Federal Reserve continues on its current path, this may be a very bumpy ride.

President Trump By The Numbers

The Gateway Pundit posted an article today about President Trump’s first month in office.

The article reports:

On January 20th, the day of the Trump Inauguration, the US Debt stood at $19,947 billion.  On February 21st, a month later, the US Debt load stood at $19,935 billion.  Trump cut the US Debt burden by $12 billion and 0.1% in his first month in office!

On January 20, 2017, the US debt was $19.947 billion.
On February 21, 2017, the US debt was $19,935 billion.

By comparison, under President Obama, the US Debt burden increased by more than $200 billion in his first month in office. 

The article includes a chart showing the increase in the debt during the first month of President Obama’s presidency.

Federal spending has gotten totally out of hand. It will be wonderful if President Trump can continue moving in the direction of cutting spending. One of the reasons he is meeting so much resistance is that in the culture of Washington, D.C., money equals power. Both Republicans and Democrats will fight anything that diminishes their perceived power. President Trump represents that threat.