The U.S. economy contracts!

[atpeace]

33 minutes ago, BLMFem said:

Yes, you can. If you'd like I can send you actual real world examples of countries that have reduced spending without causing a recession.

I can PM you the links for your perusal. Would you like that?

Since the beginning of time and any country.  That should be easy  🙂 Insane spending over the last 15 years have boosted the USA economy.  Conservatives and liberals both have done it.  I think Trump realises a recession soon would be better than later.  He can exit with a growing economy.  Hmm, actually have no idea what his intentions are....

[Harrisfan]

Just now, candide said:

Trumponomics! 

 

https://www.bea.gov/news/2025/gross-domestic-product-1st-quarter-2025-advance-estimate

Good news

[placeholder]

1 minute ago, Harrisfan said:

Prices on Chinese goods not all goods.

Not true. Automobile tariffs are already in effect. And Trump's base 10% is also in effect. And tariffs on aluminum and steel.

[Harrisfan]

2 minutes ago, placeholder said:

Not true. Automobile tariffs are already in effect. And Trump's base 10% is also in effect. And tariffs on aluminum and steel.

Which are one offs. 

[jas007]

52 minutes ago, placeholder said:

How long will it take before Trumpists claim that the figures are fake. You know, like the stolen election.

 

The figures are real, no doubt.  What's surprising to me is that people didn't already know the economy was in trouble. Take a look at the US stock market right now. You'd think they just announced the end of the world.  

 

Whatever.  Anyone who didn't know the economy is in trouble deserves to lose all their money.  

[Harrisfan]

4 minutes ago, jas007 said:

The figures are real, no doubt.  What's surprising to me is that people didn't already know the economy was in trouble. Take a look at the US stock market right now. You'd think they just announced the end of the world.  

 

Whatever.  Anyone who didn't know the economy is in trouble deserves to lose all their money.  

3/4 of an M shaped low on the Dow. Should be a low in the next few weeks.

[jas007]

1 minute ago, Harrisfan said:

3/4 of an M shaped low on the Dow. Should be a low in the next few weeks.

I'm not worried about the stock market in the least.  I can't time the short to intermediate term, but for longer periods, all is well.  Better to have stocks than increasingly worthless dollars. 

[gargamon]

1 hour ago, placeholder said:

How long will it take before Trumpists claim that the figures are fake. You know, like the stolen election.

 

Not long. The Orange Buffoon is blaming the market drop and the GDP cratering is due to Biden. Easily predicted that this would be the moron's response, and the cult will suck it up, as usual.

[Harrisfan]

4 minutes ago, gargamon said:

Not long. The Orange Buffoon is blaming the market drop and the GDP cratering is due to Biden. Easily predicted that this would be the moron's response, and the cult will suck it up, as usual.

Wrong. It's due to spending cuts. 

[jas007]

4 minutes ago, gargamon said:

Not long. The Orange Buffoon is blaming the market drop and the GDP cratering is due to Biden. Easily predicted that this would be the moron's response, and the cult will suck it up, as usual.

Well, it's not that far fetched to blame Biden.  Trump hasn't been around long enough to cause too much trouble.  Anyway, the issue isn't who caused the problem, the issue is that some people didn't even know there was a problem.  Of course the economy is in trouble.  All you have to do is look at the news every day.  It's not rocket science. 

[gargamon]

46 minutes ago, jas007 said:

Trump hasn't been around long enough to cause too much trouble.  

100 days is more than enough. It's all about the tariffs and how Trump's billionaire buddies ordered their overseas requirements before the tariffs came into effect.

[placeholder]

 

4 hours ago, jas007 said:

The figures are real, no doubt.  What's surprising to me is that people didn't already know the economy was in trouble. Take a look at the US stock market right now. You'd think they just announced the end of the world.  

 

Whatever.  Anyone who didn't know the economy is in trouble deserves to lose all their money.  

Really? Employment was strong. Inflation, while slightly higher than the desired 2% level, was not a threat. Before Trump took office, the consensus of economists was that there wasn't much likelihood of a recession.

[placeholder]

3 hours ago, jas007 said:

Well, it's not that far fetched to blame Biden.  Trump hasn't been around long enough to cause too much trouble.  Anyway, the issue isn't who caused the problem, the issue is that some people didn't even know there was a problem.  Of course the economy is in trouble.  All you have to do is look at the news every day.  It's not rocket science. 

Yes, it's real far-fetched. Just look at what's facing business owners. It's very hard to make plans when you've got an erratic President in charge. And lots of small business create designs for product and outsource them to China to be manufactured. There's a huge ecosystem over there that took decades to develop, Where do they go now?  A big chunk of machine tools come from China, Where do they go now? Etc... And not just about China. Who knows where tariffs on other nations will be 2 months from now?

 

[jas007]

5 hours ago, placeholder said:

 

Really? Employment was strong. Inflation, while slightly higher than the desired 2% level, was not a threat. Before Trump took office, the consensus of economists was that there wasn't much likelihood of a recession.

First of all, before Trump took over, the Biden Administration was issuing phony statistics on just about everything.  They wanted everyone to think everything was "fine."  That's why the phony numbers mow need revision, after the fact.  The lies are being corrected. If you don't know that, you should. 

[NoDisplayName]

Trump's got the Chinese just where he wants 'em!

 

Winning, Xi wrote.

 

The U.S. economy shrank by 0.3 percent in the first quarter of 2025, marking the country's first contraction in three years. The news of weak GDP figures came just as a parallel development unfolded abroad: China's economy grew faster than expected, expanding by 5.4 percent.

 

https://www.newsweek.com/trump-loses-first-round-trade-war-us-economy-shrinks-chinas-grows-2066364

[jas007]

5 hours ago, placeholder said:

Yes, it's real far-fetched. Just look at what's facing business owners. It's very hard to make plans when you've got an erratic President in charge. And lots of small business create designs for product and outsource them to China to be manufactured. There's a huge ecosystem over there that took decades to develop, Where do they go now?  A big chunk of machine tools come from China, Where do they go now? Etc... And not just about China. Who knows where tariffs on other nations will be 2 months from now?

 

I think you have a selective memory problem and do not understand how money printing and inflation go hand in hand, how inflation develops, and the relationship between bank reserves, credit expansion or contraction, and inflation or deflation in the economy. And you certainly have a problem with taking phony government statistics at face value.  

 

In any event, there's usually a time lag involved as the new dollars leave the banking system and bleed into the consumer and business economy.  As so, the trillions of new dollars that came into existence during Biden's term are, to this day, affecting prices. Inflation can be "sticky," as they say.  Prices go up, but merchants are often reluctant to lower them for any number of reasons.  I could go into that, but you can look it up. 

 

And I think I explained to you the other day about Chinese-made machine tools. Assuming that we're talking about high precision CNC machines tools, there is no "big chunk" of them that come from China into the USA.  Even in China, only 6% of the CNC machine tools they use there are made in China. They don't even use their own machines, for the most part, as the ones they manufacture are not known for precision or accuracy.  Instead, they primarily use CNC machine tools manufactured in Germany, Switzerland, Japan, and the USA.  They use Chinese-made CNC machines to manufacture low and middle grade parts where precision and accuracy are not so important. 

 

But according to you, even though China knows better than to use the CNC equipment they manufacture, for some reason US manufacturers are clamoring to get their hand of a a supposedly "big chunk" of Chinese machine tools?  LOL

 

And even if you're talking about manufacturers in the USA who routinely use low-end Chinese machine tools, the immediate need for a "big chunk" of those is questionable.  They're not the kind of thing that you use once and then throw it away.  They can last for years before needing replacement.  

 

This trade war stand-off will be over long before US manufacturers are hurt by a shortage of low-end Chinese machine tools.  

[jas007]

23 minutes ago, NoDisplayName said:

Trump's got the Chinese just where he wants 'em!

 

Winning, Xi wrote.

 

The U.S. economy shrank by 0.3 percent in the first quarter of 2025, marking the country's first contraction in three years. The news of weak GDP figures came just as a parallel development unfolded abroad: China's economy grew faster than expected, expanding by 5.4 percent.

 

https://www.newsweek.com/trump-loses-first-round-trade-war-us-economy-shrinks-chinas-grows-2066364

That's nice, but sort of beside the point.  For purposes of this supposed stand-off between Xi and Trump, what matters is staying power. And in my mind, the Fed can and will keep printing money for as long as it takes for China to come to the table with some real concessions. Actually, that's what Trump seems to want, in any event, right?  More money printing. A lower dollar. A competitive edge for US exporters. All Trump has to do is stay the course.  

 

The supposed stand-off between Trump and Powell is a sideshow.  The Fed Put is always there. That's policy. 

 

At some point, printing more and more money is counterproductive, but I think Xi will be in trouble long before that happens. China already has trouble in its manufacturing sector, and its real estate market has crashed.  Mortgage lenders are either on life support out have been nationalized. 

 

And whatever is going on, the US markets are now supposedly reflecting an easing of trade tensions, especially in the aftermarket today.  I didn't see any specific news, but the markets always seem to sniff things out.  

[placeholder]

 

3 hours ago, jas007 said:

First of all, before Trump took over, the Biden Administration was issuing phony statistics on just about everything.  They wanted everyone to think everything was "fine."  That's why the phony numbers mow need revision, after the fact.  The lies are being corrected. If you don't know that, you should. 

As I predicted, Trumpists would claim that the BLS was lying. No proof offered. No proof that the BLS has now changed how it operates. Just self-serving falsehoods. Impossible to have a rational exchange with people like you who inhabit an alternatiive reality.

[placeholder]

2 hours ago, jas007 said:

I think you have a selective memory problem and do not understand how money printing and inflation go hand in hand, how inflation develops, and the relationship between bank reserves, credit expansion or contraction, and inflation or deflation in the economy. And you certainly have a problem with taking phony government statistics at face value.  

 

In any event, there's usually a time lag involved as the new dollars leave the banking system and bleed into the consumer and business economy.  As so, the trillions of new dollars that came into existence during Biden's term are, to this day, affecting prices. Inflation can be "sticky," as they say.  Prices go up, but merchants are often reluctant to lower them for any number of reasons.  I could go into that, but you can look it up. 

 

And I think I explained to you the other day about Chinese-made machine tools. Assuming that we're talking about high precision CNC machines tools, there is no "big chunk" of them that come from China into the USA.  Even in China, only 6% of the CNC machine tools they use there are made in China. They don't even use their own machines, for the most part, as the ones they manufacture are not known for precision or accuracy.  Instead, they primarily use CNC machine tools manufactured in Germany, Switzerland, Japan, and the USA.  They use Chinese-made CNC machines to manufacture low and middle grade parts where precision and accuracy are not so important. 

 

But according to you, even though China knows better than to use the CNC equipment they manufacture, for some reason US manufacturers are clamoring to get their hand of a a supposedly "big chunk" of Chinese machine tools?  LOL

 

And even if you're talking about manufacturers in the USA who routinely use low-end Chinese machine tools, the immediate need for a "big chunk" of those is questionable.  They're not the kind of thing that you use once and then throw it away.  They can last for years before needing replacement.  

 

This trade war stand-off will be over long before US manufacturers are hurt by a shortage of low-end Chinese machine tools.  

There's a reason why manufacturers buy machine tools from China What reason could that be...hmmm. And if  no else can currently make up for the shortfall, what are the consequences for American manufacturers?

[placeholder]

8 minutes ago, placeholder said:

 

As I predicted, Trumpists would claim that the BLS was lying. No proof offered. No proof that the BLS has now changed how it operates. Just self-serving falsehoods. Impossible to have a rational exchange with people like you who inhabit an alternatiive reality.

Further thoughts on this. It seems you have a predilection for relying on absence of evidence . First it was Trump understands the trade balance because he has never betrayed in words  any understanding of it at all. Now, it's the BLS has changed from its previous fraudulent practices despite the fact there has been absolutely no news about that. Do you understand how nuts that is? That the Trump administration wouldn't publicize something that would incriminate the Biden Administration and make them look better? That they wouldn't trumpet reforms they have made to the system?

[jas007]

3 minutes ago, placeholder said:

There's a reason why manufacturers buy machine tools from China What reason could that be...hmmm. And if  no else can currently make up for the shortfall, what are the consequences for American manufacturers?

Either to you or to another poster, I explained why this issue doesn't much matter.  China produces machine tools that are only suitable for work not requiring great precision.  For that, even the Chinese know better than to use their own equipment. They use CNC machines from Europe, Japan, and the USA.

 

As for the machines purchased from China by manufacturers in the USA? Surely you must realize that this type of machine doesn't wear out and need replacement every other week. They can last for years. So, if certain manufacturers can't get their hands on replacements for the time being, so what? And if some factories want to relocate and need new machinery, they'll have to just wait or find another source. The US economy will not grind to a halt.  Not by a long shot, and in any event, China and the USA will have a deal by then, I believe. So the entire "issue" exists only in your head, not in reality. 

[ThreeCardMonte]

Notice how the Trump haters and MSM were all over Trump when the market took a downturn earlier over tariffs.  Doomsday.

 

Not a peep over the great comeback. And it’s not over yet.

 

 I predicted 6-9 months.  I stand corrected.

 

Biden’s first two years in office were much worse.  
 

Trump will win the tariff war.  Once China figures out how to “save face”.

[placeholder]

26 minutes ago, jas007 said:

Either to you or to another poster, I explained why this issue doesn't much matter.  China produces machine tools that are only suitable for work not requiring great precision.  For that, even the Chinese know better than to use their own equipment. They use CNC machines from Europe, Japan, and the USA.

 

As for the machines purchased from China by manufacturers in the USA? Surely you must realize that this type of machine doesn't wear out and need replacement every other week. They can last for years. So, if certain manufacturers can't get their hands on replacements for the time being, so what? And if some factories want to relocate and need new machinery, they'll have to just wait or find another source. The US economy will not grind to a halt.  Not by a long shot, and in any event, China and the USA will have a deal by then, I believe. So the entire "issue" exists only in your head, not in reality. 

I've noticed this repeatedly this falsity cropping up in your economic arguments. Because most people don't need something now that means that they can do without it until such time as it's available. And maybe it was just one item there might be some truth to that. But when it's a myriad of items, that doesn't work anymore. If a company needs a machine tool now, it needs it now. It can't put off purchases until sometime later. This applies to all sorts of things. And the accumulative effect of not buying many things at a certain time means there is going to be damage to the economy. And of course many of the things that you can buy will cost more. More damage.

As for your claim that the trade war is going to be settled soon, thank you traveler from the future. That's so reassuring. 

[xylophone]

28 minutes ago, ThreeCardMonte said:

Not a peep over the great comeback. And it’s not over yet.

 

LOL......"The great comeback".

 

Some stats regarding trumps 'winning ways"........

 

 

US stock markets took a hit in the first 100 days of Trump’s second term. It is the biggest drop seen this early in any presidential term in the last two decades. This follows Trump’s attacks on the head of the independent Federal Reserve - which his aides have urged him to soften - and uneven rollout of tariffs, including in an area mainly inhabited by penguins.

Trump has visited a golf club nearly every weekend

Trump has spent nearly every weekend at a golf course, according to a review of his schedule, media reports and publicly available information.

In 2011, Trump complained that Obama “plays golf to escape work while America goes down the drain”. Later, Trump wrote, “Can you believe that, with all of the problems and difficulties facing the US, President Obama spent the day playing golf.”

In 2016, as Trump sought to make the leap from reality TV celebrity to commander in chief, he told supporters in Virginia he “may never see” his golf courses and properties again. “Because I’m going to be working for you, I’m not going to have time to go play golf.” Yeah right!!!

 

And the gullible and "poorly educated" still fall for his lies. Never in all of my decades on this earth would I believe that so many Americans could be so foolish as to fall for the lies of this grifter, felon and multi-bankrupt, but since when has "common sense" been a strong point of the Yanks?

[Digitalbanana]

[ThreeCardMonte]

5 minutes ago, xylophone said:

LOL......"The great comeback".

 

Some stats regarding trumps 'winning ways"........

 

 

US stock markets took a hit in the first 100 days of Trump’s second term. It is the biggest drop seen this early in any presidential term in the last two decades. This follows Trump’s attacks on the head of the independent Federal Reserve - which his aides have urged him to soften - and uneven rollout of tariffs, including in an area mainly inhabited by penguins.

Trump has visited a golf club nearly every weekend

Trump has spent nearly every weekend at a golf course, according to a review of his schedule, media reports and publicly available information.

In 2011, Trump complained that Obama “plays golf to escape work while America goes down the drain”. Later, Trump wrote, “Can you believe that, with all of the problems and difficulties facing the US, President Obama spent the day playing golf.”

In 2016, as Trump sought to make the leap from reality TV celebrity to commander in chief, he told supporters in Virginia he “may never see” his golf courses and properties again. “Because I’m going to be working for you, I’m not going to have time to go play golf.” Yeah right!!!

 

And the gullible and "poorly educated" still fall for his lies. Never in all of my decades on this earth would I believe that so many Americans could be so foolish as to fall for the lies of this grifter, felon and multi-bankrupt, but since when has "common sense" been a strong point of the Yanks?

The current market tells a different story compared to your unproven graphs/spreadsheets. blah blah blah.

 

Check the news. 
 

DOW currently about 40,700.

[fondue zoo]

14 hours ago, placeholder said:

How long will it take before Trumpists claim that the figures are fake. You know, like the stolen election.

 

 

I read it's being referred to as the Biden Overhang?

 

 

 

[jas007]

6 minutes ago, placeholder said:

Further thoughts on this. It seems you have a predilection for relying on absence of evidence . First it was Trump understands the trade balance because he has never betrayed in words  any understanding of it at all. Now, it's the BLS has changed from its previous fraudulent practices despite the fact there has been absolutely no news about that. Do you understand how nuts that is? That the Trump administration wouldn't publicize something that would incriminate the Biden Administration and make them look better? That they wouldn't trumpet reforms they have made to the system?

 

First, anyone in the US will tell you that government CPI numbers are BS. All a person has to do is go shopping once in a while. So it's not as if the government isn't capable of distorting reality. They have a lot of experience doing just that. Will that practice continue under Trump? Probably. It makes his life easier, I'm sure, not having to pay retirees fairly. The system is already bankrupt and they're trying to save it, if possible. 

 

As for other government statistics?  Unless I was hallucinating, I do think I've heard news stories about recent revisions to government data oriiginally released during the Biden administration. To be sure, that kind of thing can occasionally be required, but in these cases, it was characterized as more of a systemic thing based on a past pattern or practice where the Biden administration wished to portray things in a good light. 

 

As for Trump's understanding of the trade balance in the context of the World Reserve Currency?  You keep bringing that up as if repeating the same nonsense over and over somehow makes it true.  It's common knowledge how it all works and is now part and parcel of economic theory.  No "proof" is necessary.  It's called the Triffin Dilemma. Trump knows, his advisors know, everyone knows. There are even formulas and frameworks published for understanding the dilemma and why it's considered part and parcel of having the world reserve currency. 

 

If I may use some AI to assist here (emphasis mine). Or,  if this gets deleted, go to Grok or Perplexity and ask it to explain why the Triffin dilemma is part and parcel of having the world reserve currency. 

 

The Triffin Dilemma, identified by economist Robert Triffin in the 1960s, highlights a fundamental conflict for a country whose currency serves as the global reserve currency. This conflict arises between domestic economic stability and international obligations to provide liquidity. Below, I’ll explain the dilemma, outline proposed "formulas" (solutions or strategies) to address it, and clarify why it’s an inherent issue for the world reserve currency issuer. Note that the term "formulas" in this context refers to proposed solutions or frameworks, as there are no literal mathematical equations for resolving the dilemma.

--

The Triffin Dilemma emerges when a national currency, like the U.S. dollar, is the global reserve currency, meaning it’s widely held by foreign governments and central banks for international trade, debt settlement, and reserves. To meet global demand for this currency, the issuing country must supply enough of it, typically by running trade or balance of payments deficits (spending more abroad than it earns). However, persistent deficits can erode confidence in the currency’s value, leading to economic instability both domestically and globally. This creates a paradox:

 

1. **International Obligation**: The reserve currency country must provide sufficient liquidity (its currency) to support global trade and economic growth. This often requires running trade deficits, as dollars flow abroad through imports or investments.

 

2. **Domestic Stability**: Persistent deficits increase the country’s debt and can weaken the currency’s value, causing inflation or loss of confidence, which conflicts with domestic goals like price stability and economic competitiveness.

 

The dilemma was particularly evident under the Bretton Woods system (1944–1971), where the U.S. dollar was pegged to gold, and other currencies were pegged to the dollar. The U.S. had to supply dollars to meet global demand, but this led to a "dollar glut" that strained its gold reserves, culminating in the Nixon Shock of 1971, when the U.S. suspended dollar-to-gold convertibility. Even today, in a fiat currency system, the dilemma persists as the U.S. runs chronic trade deficits to supply dollars, raising concerns about debt sustainability.[]

 

### Why the Triffin Dilemma is Part and Parcel of Having the World Reserve Currency

 

The Triffin Dilemma is inherent to the role of a global reserve currency because of the dual role the currency plays:

 

1. **Global Public Good**: A reserve currency acts as an international public good, facilitating trade, investment, and reserve accumulation worldwide. The issuing country must supply enough currency to meet this demand, which often exceeds domestic needs. This supply typically comes through trade deficits, as the country imports more than it exports, sending currency abroad.

 

2. **Domestic Constraints**: Running persistent deficits to supply the world with currency can undermine the issuing country’s economic health. It may lead to:
   - **Debt Accumulation**: Chronic deficits increase external debt, as seen with the U.S., where foreign-held federal debt exceeds $7.6 trillion as of Q3 2023

   - **Loss of Confidence**: If deficits grow too large, foreign holders may doubt the currency’s stability, potentially triggering a currency crisis

 

3. **No Escape from the Trade-Off**: The issuing country cannot simultaneously maintain a strong currency (for domestic stability) and provide unlimited liquidity (for global needs) without risking imbalances. If it reduces deficits to stabilize its economy, global liquidity shrinks, potentially slowing world trade and growth. If it continues deficits, it risks devaluing its currency and losing reserve status.

 

This tension was historically evident in the Bretton Woods collapse and remains relevant today, as the U.S. dollar’s dominance (about 60% of global currency reserves) requires ongoing deficits, contributing to a debt-to-GDP ratio projected to hit 150% by 2040. The dilemma is "part and parcel" because any country issuing the global reserve currency faces this conflict, regardless of the monetary system

---

 

Conclusion:

 

The Triffin Dilemma is an inherent challenge for any country issuing the global reserve currency, as it must balance domestic stability against the international need for liquidity. This conflict, rooted in the need to run deficits to supply currency, risks debt accumulation, inflation, and loss of confidence. Proposed solutions—global currency, multi-currency system, gold standard, digital currency, or enhanced coordination—offer ways to mitigate the dilemma but come with significant challenges. The U.S. dollar’s continued dominance underscores the dilemma’s relevance, but its persistence suggests a need for systemic reform to ensure long-term global economic stability.

 

[jas007]

43 minutes ago, ThreeCardMonte said:

Notice how the Trump haters and MSM were all over Trump when the market took a downturn earlier over tariffs.  Doomsday.

 

Not a peep over the great comeback. And it’s not over yet.

 

 I predicted 6-9 months.  I stand corrected.

 

Biden’s first two years in office were much worse.  
 

Trump will win the tariff war.  Once China figures out how to “save face”.

Some people think it's already happening.  Publicly, they maintain that they won't back down, and yet privately they've established a large list of items that are exempt from tariffs.  This list is widely circulated in China. 

[simple1]

Trump mocked as he ducks blame for 'stunning' economic news

The New York Times characterized President Trump’s first quarter results as “a stunning reversal from the strong growth at the end of last year.”

 

'This is going great': Trump mocked as he ducks blame for 'stunning' economic news