I think it oversimplifies a few things. Trump pushing for lower interest rates makes sense from a debt-servicing standpoint, but the Fed doesn’t operate purely on political pressure—it reacts to economic conditions. If inflation resurges or the economy stays strong, rate cuts aren’t guaranteed.
As for the dollar weakening, it’s true that other countries could respond with their own currency moves, but that’s not a given. China has its own economic struggles, and the EU’s spending plans don’t necessarily mean they’ll prioritize weakening the euro.
The idea that increased liquidity will boost stocks and Bitcoin makes sense in the short term, but markets don’t move in a straight line. If inflation spikes again or confidence in the economy wavers, things could get messy. 2026 being “bearish by comparison” depends on a lot of unknowns—global politics, interest rate policy, and overall economic growth.
So while Trump’s influence on economic policy is real, it’s not a one man game. The Fed, global markets, and economic fundamentals all play a role.
As if the only (or even main) factor in lowering interest rates was the stock market
absolutely not. It makes sense but is not what he has planned.
Too much thought for DJT and i cant believe it is Bessener or Lutnick (sp?)
Lots of risks to theis AND Trump will worry buyers
The. Why didn’t any other president ever do this if it’s a genius plan? What about the concentration camps? Is that just for the long term benefit 🤣
The first clue that this is rubbish is the qualifier “not a trump fan but”
This is silly. Trump will replace Powell next May with a more dovish fed chair so rates will come down then. Doesn’t make sense to crash the market just to reduce debt servicing costs (think of the lost tax revenue due to a weaker economy).
Trump definitely uses tariffs as a negotiating tactic but he also believes they’re good to attract investment and raise revenue.
Finally, Trump is obsessed with the stock market and he didn’t see this coming. He just gave a speech in Miami in February where he bragged the market was up since he won. Remember all his stock market comments during the election campaign and first term.
Explains why gold is at ATHs
The Fed feels no pressure from the stock market, this person lost me immediately at that statement.
They care about macroeconomic data, not stock prices, which can fluctuate for many reasons. The Fed looks primarily at inflation and jobs numbers.
If anything this is 100% backwards, tariffs actually cause inflation to rise. Which can eventually result in a recession, that would then lower inflation, but it’s a pretty crazy way to achieve that result and can MASSIVELY backfire into a depression or stagflation.
Weakening the dollar also generally spikes inflation, so again, this is totally backwards. A strong dollar has always been great for America overall, though overly strong does present some challenges for international businesses.
I have a simpler theory. Trump is an imbecile, and he knows nothing about actual economics or fiscal policy. Tariffs are something the president fully controls, so it’s basically his biggest button to push. When you put a moron in a room with a button, they tend to push the button.
He’s talking about the “fed put”, the only problem is the inflation, it can go against him, and the fed keeps interest high ,or outflows of foreign capital due to risky environment.
And the support for Russia / Putin in the war against Ukraine? Explain that?
I think the US is trying to inflate its way out of debt as you suggest, but there’s no way Trump is smart enough to figure this out. It’s coming from his handlers.
Trump is not that intelligent.
Tariffs are inflationary. So if this is their plan it has a gaping hole in the theorem.
His tax cut proposal is also projected to be deficit increasing and inflationary.
Why not just raise taxes and cut government spending? Both would contract the economy without adding inflationary pressures and reduce the deficit and likely lead to lower rates as both actions are deflationary?!?
This isn’t about rates. It’s about power and the economy running through Trump.
This explanation is dumb. No economic or financial policy should go without explicitly and publicly explained. It just created unintended consequences. Most recent event is Milei’s policy. Whether it is good or bad, he clearly stated what he wants to achieve using these tools.
The problem with Trump’s policy is it keeps shifting, first boarder security, then annex Canada, and then fair trades. Who knows what else. That is the problem.
Maybe this is what will happen. But to suggest this is trumps “plan” is fucking ridiculous. He doesn’t even know how tariffs work.
Honestly the mental gymnastics people go thru is astounding. Trump is an idiot and just trying to strong arm the world to give the us “the best deals.”
Ah yes the fabled macro economics fan who somehow also believe Feds get pressured by the stock market lmao. Should dig up Volcker and ask him to tell that guy what Feds think about stock market, then let Volcker show him what he did.
He so dumb….
This post shows how not being well or enough educated in complex topics such as economics or finance can lead to erroneous assumptions. I don’t even know where to start, but I’ll give it a try.
Firstly, The US is currently a large net importer regarding trade balance, a weak dollar will drive costs and prices up, making businesses struggle to keep the supply chain and the prices sustainable. Even worse, a sharp decrease of the US Dollar might even lead them straight into insolvency or bankruptcy. I don’t think people realise the consequences of a such downward spiral.
Secondly, as it’s partially true that some countries might want to keep their currency parity to the US Dollar stable, in order to keep their exports competitive, this can’t be generalised to the entire world. For instance, if Europe manages to create a growing and sustainable economy, the Euro appreciation is a nice meal tip and give it a strong economic leverage.
On top of that, cutting rates, and hell (what the fucking hell) QE, in such an unstable economic environment might actually delay in short-term, but worsen the chances of a debt death spiral on the long run. Like, how the fuck aren’t people realizing that the current US huge debt is partially caused by mad QEs, which failed to be kept up by the US GDP.
What negotiation tactic? This argument made a lot more sense the first term and is actually the only legitimate use of tariffs. What does Trump want? His asks are incoherent.
Why would a country wanna weaken their own currency?
I think Trumps tactics are a mix between a mafia boss from the movies and colonialism.
Trump is a 1 trick pony taking what he did in his businesses and applying it to our economy. In his businesses he threatened and insulted people, strong armed smaller companies, disregarded contracts by attacking with lawyers.
He now has the strongest military and economy behind him so he bullies other countries to give him something favorable or he hints at causing “problems” – examples, Canada – threat of being the 51st state, Taiwan & Ukraine – threat of removing protection and aid, EU – threat of taking Greenland and leaving NATO, Mexico – renaming Gulf of Mexico to America, China – threat of taking the Panama Canal etc…
The problem is that even if the bully tactics work in the short term, now the US now can’t be trusted as an ally bc he’s breaking signed agreements and disrespecting many countries. The vitriol from regular Canadians and Europeans will cause damage even after Trump gets what he wants in some manner and tariffs are pulled. I think we as Americans forget that the rest of the world’s population actually follows global politics and will become very anti-American. Look at Tesla in Canada and Germany, that’s the long-term future of all American products and services if this continues.
If debt is the question. Then inflation is the answer.
Why?
1st: US cannot default (if doesn’t want to). Its debt it’s in dollar it can freely print dollars. So it cannot default unless ir wants.
But if you print such an amount of dolar straight away for paying your debt people will loss confidence in you.
How you print such an amount of dollars naturally?
Inflation explained:
Easy to understand:
” if you have 105.000 dollars in bank and a 5% inflation, next year you will be able to buy the equivalent to 100.000 dollars of products or services”
Everyone understands this.
Hard to understand:
” if you owe 105.000 dollars to the bank and there is a 5%inflation, next year you will owe the equivalent to 100.000 dollars of products and services”.
(Yeah: if you have more debt than cash, inflation benefits you. And I know this is a mindblowing fact that is hard to accept).
So: is really debt what moves Trump economic politic?
Then tariffs, crash, immigration policy… is al about having inflation at Argentina style. 300% annually so my debt gets divided by 3 every year.
Problem solved!
100p bullshit, the fed is not driven by the stock market, increasing money supply increases inflation which is deadly at this point, and this is truly what you wanted to do, using tariffs is the most round about way of going about something which will also cause a shit ton of collateral damage.
This is not some 4D chess move, its because its the only cudgel he can wield, and he wields it like a buffoon
Does he seem like someone who plays 4D chess. Really?
Every response here incorrectly thinks the Fed controls long term interest rates. In the absence of QE, they don’t. The bond market does.
Trump’s actions are to drive the bond market to lower rates by creating a recession through tariffs because the Fed is not lowering rates until inflation is back to target levels.
I guess it is always Trump First not America
first like he claims.
yup this probably nails it… maybe not the reasons, but certainly the effects.
the bullish crypto analysts pretty much say the same thing but for different reasons
fuck bitcoin
I’m a big Trump fan. This is completely wrong. The basis is wrong from the start. The Fed does not base their interest rate policy on the stock market. They look at unemployment and inflation. Those two factors, that’s it. The stock market is reactive to those things, but the market does not drive what the Fed does.
Russians have a meme called “Многоходовочка”, translated as “Many-steps-scheme”. It’s when Putin does something stupid and supporters with propaganda try to find logic behind stupidity. The post looks like a case of it.
Only that this will not happen
You just described Steve Bannon’s anti globalist agenda which was adopted by Project 2025. Sorry, I think he is a hapless narcissistic 4 year old groping in the dark who thinks he in control but is being manipulated by an anti-globalist. He’s a Project 2025 stooge screwing millions of Americans. He is weakening the US position globally creating adversaries whilst wiping his ass with the Constitution. Economic indicators drop quickly and rise very slowly. Maybe by the end of his term, my portfolio will be back to where it was under Biden. I think another war is imminent in this fucked up climate.
While it could be a reasonable explanation, I think the more plausible one is that if he truly replaces income tax with tariffs, it’s a regressive tax that places a higher burden on the middle and lower class while giving a tax cut to the upper class.
Sure, you keep more income since you don’t pay taxes, but EVERYTHING gets more expensive. Not just because of import tax, but also because everyone knows everyone has more income, so housing will go up, service charges go up, and soon enough you are paying more at the end of the day then you did when you had to pay income tax.
This would serve to benefit Trump and the billionaires who backed him, as well as wealthy people who own property and business. There are literally photos of some of the most powerful billionaires standing behind Trump during his inauguration party.
that guy copes so hard
Can we stop pretending like there is a plan?
He’s not smart enough to think through the consequences of any action.
The billionaires have already squeezed all the excess cash out of the middle and working class. The billionaires need a cash infusion so they can keep hoarding it.
37 comments
I think it oversimplifies a few things. Trump pushing for lower interest rates makes sense from a debt-servicing standpoint, but the Fed doesn’t operate purely on political pressure—it reacts to economic conditions. If inflation resurges or the economy stays strong, rate cuts aren’t guaranteed.
As for the dollar weakening, it’s true that other countries could respond with their own currency moves, but that’s not a given. China has its own economic struggles, and the EU’s spending plans don’t necessarily mean they’ll prioritize weakening the euro.
The idea that increased liquidity will boost stocks and Bitcoin makes sense in the short term, but markets don’t move in a straight line. If inflation spikes again or confidence in the economy wavers, things could get messy. 2026 being “bearish by comparison” depends on a lot of unknowns—global politics, interest rate policy, and overall economic growth.
So while Trump’s influence on economic policy is real, it’s not a one man game. The Fed, global markets, and economic fundamentals all play a role.
As if the only (or even main) factor in lowering interest rates was the stock market
absolutely not. It makes sense but is not what he has planned.
Too much thought for DJT and i cant believe it is Bessener or Lutnick (sp?)
Lots of risks to theis AND Trump will worry buyers
The. Why didn’t any other president ever do this if it’s a genius plan? What about the concentration camps? Is that just for the long term benefit 🤣
The first clue that this is rubbish is the qualifier “not a trump fan but”
This is silly. Trump will replace Powell next May with a more dovish fed chair so rates will come down then. Doesn’t make sense to crash the market just to reduce debt servicing costs (think of the lost tax revenue due to a weaker economy).
Trump definitely uses tariffs as a negotiating tactic but he also believes they’re good to attract investment and raise revenue.
Finally, Trump is obsessed with the stock market and he didn’t see this coming. He just gave a speech in Miami in February where he bragged the market was up since he won. Remember all his stock market comments during the election campaign and first term.
Explains why gold is at ATHs
The Fed feels no pressure from the stock market, this person lost me immediately at that statement.
They care about macroeconomic data, not stock prices, which can fluctuate for many reasons. The Fed looks primarily at inflation and jobs numbers.
If anything this is 100% backwards, tariffs actually cause inflation to rise. Which can eventually result in a recession, that would then lower inflation, but it’s a pretty crazy way to achieve that result and can MASSIVELY backfire into a depression or stagflation.
Weakening the dollar also generally spikes inflation, so again, this is totally backwards. A strong dollar has always been great for America overall, though overly strong does present some challenges for international businesses.
I have a simpler theory. Trump is an imbecile, and he knows nothing about actual economics or fiscal policy. Tariffs are something the president fully controls, so it’s basically his biggest button to push. When you put a moron in a room with a button, they tend to push the button.
He’s talking about the “fed put”, the only problem is the inflation, it can go against him, and the fed keeps interest high ,or outflows of foreign capital due to risky environment.
And the support for Russia / Putin in the war against Ukraine? Explain that?
I think the US is trying to inflate its way out of debt as you suggest, but there’s no way Trump is smart enough to figure this out. It’s coming from his handlers.
Trump is not that intelligent.
Tariffs are inflationary. So if this is their plan it has a gaping hole in the theorem.
His tax cut proposal is also projected to be deficit increasing and inflationary.
Why not just raise taxes and cut government spending? Both would contract the economy without adding inflationary pressures and reduce the deficit and likely lead to lower rates as both actions are deflationary?!?
This isn’t about rates. It’s about power and the economy running through Trump.
This explanation is dumb. No economic or financial policy should go without explicitly and publicly explained. It just created unintended consequences. Most recent event is Milei’s policy. Whether it is good or bad, he clearly stated what he wants to achieve using these tools.
The problem with Trump’s policy is it keeps shifting, first boarder security, then annex Canada, and then fair trades. Who knows what else. That is the problem.
Maybe this is what will happen. But to suggest this is trumps “plan” is fucking ridiculous. He doesn’t even know how tariffs work.
Honestly the mental gymnastics people go thru is astounding. Trump is an idiot and just trying to strong arm the world to give the us “the best deals.”
Ah yes the fabled macro economics fan who somehow also believe Feds get pressured by the stock market lmao. Should dig up Volcker and ask him to tell that guy what Feds think about stock market, then let Volcker show him what he did.
He so dumb….
This post shows how not being well or enough educated in complex topics such as economics or finance can lead to erroneous assumptions. I don’t even know where to start, but I’ll give it a try.
Firstly, The US is currently a large net importer regarding trade balance, a weak dollar will drive costs and prices up, making businesses struggle to keep the supply chain and the prices sustainable. Even worse, a sharp decrease of the US Dollar might even lead them straight into insolvency or bankruptcy. I don’t think people realise the consequences of a such downward spiral.
Secondly, as it’s partially true that some countries might want to keep their currency parity to the US Dollar stable, in order to keep their exports competitive, this can’t be generalised to the entire world. For instance, if Europe manages to create a growing and sustainable economy, the Euro appreciation is a nice meal tip and give it a strong economic leverage.
On top of that, cutting rates, and hell (what the fucking hell) QE, in such an unstable economic environment might actually delay in short-term, but worsen the chances of a debt death spiral on the long run. Like, how the fuck aren’t people realizing that the current US huge debt is partially caused by mad QEs, which failed to be kept up by the US GDP.
What negotiation tactic? This argument made a lot more sense the first term and is actually the only legitimate use of tariffs. What does Trump want? His asks are incoherent.
Why would a country wanna weaken their own currency?
I think Trumps tactics are a mix between a mafia boss from the movies and colonialism.
Trump is a 1 trick pony taking what he did in his businesses and applying it to our economy. In his businesses he threatened and insulted people, strong armed smaller companies, disregarded contracts by attacking with lawyers.
He now has the strongest military and economy behind him so he bullies other countries to give him something favorable or he hints at causing “problems” – examples, Canada – threat of being the 51st state, Taiwan & Ukraine – threat of removing protection and aid, EU – threat of taking Greenland and leaving NATO, Mexico – renaming Gulf of Mexico to America, China – threat of taking the Panama Canal etc…
The problem is that even if the bully tactics work in the short term, now the US now can’t be trusted as an ally bc he’s breaking signed agreements and disrespecting many countries. The vitriol from regular Canadians and Europeans will cause damage even after Trump gets what he wants in some manner and tariffs are pulled. I think we as Americans forget that the rest of the world’s population actually follows global politics and will become very anti-American. Look at Tesla in Canada and Germany, that’s the long-term future of all American products and services if this continues.
If debt is the question. Then inflation is the answer.
Why?
1st: US cannot default (if doesn’t want to). Its debt it’s in dollar it can freely print dollars. So it cannot default unless ir wants.
But if you print such an amount of dolar straight away for paying your debt people will loss confidence in you.
How you print such an amount of dollars naturally?
Inflation explained:
Easy to understand:
” if you have 105.000 dollars in bank and a 5% inflation, next year you will be able to buy the equivalent to 100.000 dollars of products or services”
Everyone understands this.
Hard to understand:
” if you owe 105.000 dollars to the bank and there is a 5%inflation, next year you will owe the equivalent to 100.000 dollars of products and services”.
(Yeah: if you have more debt than cash, inflation benefits you. And I know this is a mindblowing fact that is hard to accept).
So: is really debt what moves Trump economic politic?
Then tariffs, crash, immigration policy… is al about having inflation at Argentina style. 300% annually so my debt gets divided by 3 every year.
Problem solved!
100p bullshit, the fed is not driven by the stock market, increasing money supply increases inflation which is deadly at this point, and this is truly what you wanted to do, using tariffs is the most round about way of going about something which will also cause a shit ton of collateral damage.
This is not some 4D chess move, its because its the only cudgel he can wield, and he wields it like a buffoon
Does he seem like someone who plays 4D chess. Really?
Every response here incorrectly thinks the Fed controls long term interest rates. In the absence of QE, they don’t. The bond market does.
Trump’s actions are to drive the bond market to lower rates by creating a recession through tariffs because the Fed is not lowering rates until inflation is back to target levels.
I guess it is always Trump First not America
first like he claims.
yup this probably nails it… maybe not the reasons, but certainly the effects.
the bullish crypto analysts pretty much say the same thing but for different reasons
fuck bitcoin
I’m a big Trump fan. This is completely wrong. The basis is wrong from the start. The Fed does not base their interest rate policy on the stock market. They look at unemployment and inflation. Those two factors, that’s it. The stock market is reactive to those things, but the market does not drive what the Fed does.
Russians have a meme called “Многоходовочка”, translated as “Many-steps-scheme”. It’s when Putin does something stupid and supporters with propaganda try to find logic behind stupidity. The post looks like a case of it.
Only that this will not happen
You just described Steve Bannon’s anti globalist agenda which was adopted by Project 2025. Sorry, I think he is a hapless narcissistic 4 year old groping in the dark who thinks he in control but is being manipulated by an anti-globalist. He’s a Project 2025 stooge screwing millions of Americans. He is weakening the US position globally creating adversaries whilst wiping his ass with the Constitution. Economic indicators drop quickly and rise very slowly. Maybe by the end of his term, my portfolio will be back to where it was under Biden. I think another war is imminent in this fucked up climate.
While it could be a reasonable explanation, I think the more plausible one is that if he truly replaces income tax with tariffs, it’s a regressive tax that places a higher burden on the middle and lower class while giving a tax cut to the upper class.
Sure, you keep more income since you don’t pay taxes, but EVERYTHING gets more expensive. Not just because of import tax, but also because everyone knows everyone has more income, so housing will go up, service charges go up, and soon enough you are paying more at the end of the day then you did when you had to pay income tax.
This would serve to benefit Trump and the billionaires who backed him, as well as wealthy people who own property and business. There are literally photos of some of the most powerful billionaires standing behind Trump during his inauguration party.
that guy copes so hard
Can we stop pretending like there is a plan?
He’s not smart enough to think through the consequences of any action.
The billionaires have already squeezed all the excess cash out of the middle and working class. The billionaires need a cash infusion so they can keep hoarding it.
Comments are closed.