‘Watch out for Your Job’
By Buck Sexton, Executive Editor
Do politics drive the economy, or does the economy drive politics?
Depends on who you ask. But remember – economists are terrible at predictions, and politicians are terrible at truth.
So, is our economy in trouble?
According to our elected officials on both sides of the aisle, America’s financial future will be nothing but blue skies ahead… as long as you don’t vote for the other guy.
Vote for the wrong team, and the whole thing will go down the tubes.
That’s also why we’re caught in a maelstrom of worry over the next recession. Is it really coming? The answer will probably determine which party controls the White House – and possibly Congress – in 2020.
With that much power, money, and influence on the line, it’s no wonder that the battle of recession narratives is heating up. The verbal fistfight over the trajectory of the economy plays out every day in the media… Especially leading up to the next Democratic debate.
Nobody can predict the future (and never trust anyone who says they can). So who’s got probability on their side? And who has the stronger argument? Is it the bullish (and generally Republican) optimists, or the pro-recession Democrats?
From a cyclical standpoint, many “experts” argue we are overdue. Some even believe the current global slowdown could hit a “death spiral” that would send the S&P 500 Index falling almost 27%, all the way down to 2100.
On the other hand, from an economic fundamentals perspective, you’ll find plenty of experts who would argue that this economy has a lot more room to run. Unemployment is at historic lows, and GDP growth remains solid. The White House, unsurprisingly, thinks talk of a recession is hogwash meant to hurt Trump’s reelection chances.
If you want an outsider’s positive point of view, “Mr. Wonderful” himself, Kevin O’Leary, was quoted last week saying he has “never seen a stronger economy in [his] life.” That’s potent stuff from a guy most famous for giving entrepreneurs a tough dose of reality.
There are risks, to be sure. The China trade anxiety looms large. It hasn’t been that bad yet, but it could always get worse. Trump oversells the likelihood of a deal on a regular basis, and that makes it tough to get a real read on the situation.
Meanwhile, expect more urgent claims of gloom and doom from the Democratic presidential candidates. Class warfare only works if you can convince one group that it’s at war with another and just doesn’t know it yet.
That means that Bernie Sanders, Elizabeth Warren, and the rest of the increasingly socialist gang of Democratic Oval Office aspirants will do everything they can to convince America that the bottom of the economy is about to fall out.
“Watch out for your job, mortgage, and 401(k)!” the Democrats will say… And that Trump the plutocrat has only made the right moves for the kind of people who can afford a membership at the Mar-a-Lago Club. The media will do all they can to magnify this message.
If this “sky is falling” perception takes hold, could it help bring about the very recession that the Democrats insist is inevitable before the 2020 election?
That’s a question I leave to you, dear reader.
If the Democrats’ warnings come true and they win the 2020 election, watch out. Their biggest campaign promises are all progressive and socialistic. And they would have serious effects on any money you’ve set aside for retirement… or your current source of income.
Read a new book – The Battle for America: Why the 2020 Election Will Cause the Biggest Financial Crisis in U.S. History – if you want to know how we got to where we are today… what socialized medicine actually looks like in other countries… and why there’s no telling how bad social unrest may be in 2020. Click here to get your copy.
“My feeling is that interest rates are telling you that there’s some very bad news down the road… We don’t know what that is, but that’s what’s being signaled to me.”
Active money managers have bled assets in recent years as investors rebelled against high fees and disappointing returns… The shift has coincided with a multiyear stretch of underperformance by value stocks and, more recently, by small-caps.
As the burglaries continued, the growers came to suspect that the criminals had found another way of getting the information they needed to target vulnerable businesses offering big payoffs: The government was giving it to them.
And let us know what you’re reading at [email protected].
Executive Editor, American Consequences
With P.J. O’Rourke and the Editorial Staff
August 29, 2019