The Last Trump

I unfortunately read things in NewsMax now, just to maintain my hunter's and tracker's acumen at spotting total nonsense at 1,000 yards or more.
Of course, when the spouter of nonsense is Mr. Trump, it is not really fair, because so much of what he says in a political-economic vein is very close to nonsense.

Tags: Massive | wealth | destruction | economy
Economist Caution: Prepare For 'Massive Wealth Destruction'

Wednesday, 08 Jan 2014 01:07 PM

Take immediate steps to protect your wealth . . . NOW!

That’s exactly what many well-respected economists, billionaires, and noted authors are telling you to do — experts such as Marc Faber, Peter Schiff, Donald Trump, and Robert Wiedemer. According to them, we are on the verge of another recession, and this one will be far worse than what we experienced during the last financial crisis.
[...]
Equally critical of the current government and our nation’s economy is real estate mogul and entrepreneur Donald Trump, who is warning that the United States could soon become a large-scale Spain or Greece, teetering on the edge of financial ruin.

Trump doesn’t hesitate to point out America’s unhealthy dependence on China. “When you’re not rich, you have to go out and borrow money. We’re borrowing from the Chinese and others.”

It is this massive debt that worries Trump the most.

“We are going up to $16 trillion [in debt] very soon, and it’s going to be a lot higher than that before he gets finished,” Trump says, referring to President Barack Obama. “When you have [debt] in the $21-$22 trillion [range], you are talking about a [credit] downgrade no matter how you cut it.”

In a recent appearance, Trump went to so far as to say the dollar is “going to hell.”

It is not a good idea to treat an important topic with this type of idiocy.

(1) People and Corporations go out and borrow money when they do not have enough cash for their projects and investments at the present time, but expect enough good revenue flows to be able to pay off the debt in the future.


They do not really do this when they are "not rich". Mr. Trump is obviously getting his stories mixed, and this is his reasoning for why the housing bubble burst: people who were "not rich" forced the banks to give them mortgages.

(2) A certain level of deficit might be necessary, implying that even a rich country needs to borrow at some level. If there were no US Treasury Bills, there would be no zero-risk haven for investors.

(3) A credit downgrade measures risk, not the absolute value of a debt.

(4) The dollar, by most indications, is doing quite well against other currencies, and has been for a while.

Again, there may be troubles ahead, but Mr. Trump cannot seem to tutor anyone in their complexities.

I left the line headed "Tags" on, because NewsMax oddly seems to have a precious enjoyment of destruction themes and memes.
I have always said that forecasting doom and catastrophe is filled with dangers, for I have known a number of people who predicted terrible things for the world or the country, but ended up ironically in having predicted their own troubles and problems.

My own view is that when many predict rain, there will be a silver lining soon. Conversely, when everyone is happy as a lark, troubles lurk around the corner. It is the inherent irony of our situation in the world.

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