The Truth about The Coming Recession and how Trump will be blamed for it







The Fed yet again did another $104.15 billion of Not Q.E. in a single day. The Fed claims it's only temporary. But that is precisely what Bernanke claimed when the Fed started QE1. Milton Freedman once said, "Nothing is so permanent as a temporary government program." The same applies to Q.E., or whatever the Fed wants to pretend it's doing. Welcome to The Atlantis Report. There is a very Dark Cloud hovering over the world economy, and at the center of this cloud lies not just Europe, but Germany – the most robust economy holding up all of Europe. The German manufacturing sector is in freefall. President Donald Trump will be blamed, calling this the result of his Trade War. It is probably too late to get him even to understand that his advisers are old-school and utterly wrong concerning trade. Their obsession with currency movements is what they taught back in school during the 1930s. Trump has made the strength of the U.S. economy a cornerstone of his 2020 reelection campaign. But he has reason to be alarmed if the economy were to tank under his watch. My advice to China, let the yuan float, and Trump will quickly see that China has been supporting its currency, not suppressing it. Global Trade Is Deteriorating Fast, Sapping the World's Economy. As Trump intensifies his trade war with China, and as factories slow in major industrial nations, world commerce is deteriorating rapidly. Trump will be blamed for this, and his badgering the Fed to lower interest rates is also a fool's game. Nobody looks at the elderly who were told to save for retirement, and you will live off the interest. Their house values were undermined in the 2007-2009 New York Banker's Mortgage-Backed scam that blew up the world economy from which we have been unable to recover fully. The younger generation cannot afford to buy a house, as they have to cope with the increasing cost of college tuition, student loan debt, and job scarcity. Over the summer, there's been a significant slide among observers in their confidence toward the economy, as it shows signs of slowing down after a decade-long record expansion. Though jobs are abundant and wages are rising, Trump's trade war with China has depressed hiring, and businesses have sharply pulled back on their spending. The sour mood has threatened Trump's electoral prospects since 70% of the economy is powered by consumer spending, and any belt-tightening could actually accelerate a recession's arrival. The insanity of global political power knows no boundary when it comes to stupidity around the world. All they have is interest rates, and after more than ten years of excessively low to negative interest rates failing to stimulate the economy in Europe, what do they do? They argue that all real money must be eliminated because people are hoarding cash and thus defeat their lower interest rates policy. The longevity of low rates has upended long-standing assumptions about money and reshaped a generation of investors, traders, savers, and policymakers. The Federal Reserve had tried to push the U.S. into a higher-rate regime, raising rates nine times since 2015, when the key short-term rate was near zero. But now the central bank appears ready to reverse course and start cutting again when it meets at the end of July. This is the new abnormal. Normally, when you are in this phase of an expansion, you have a rising inflation problem, a Federal Reserve overtightening to slow the economy, and businesses that can't afford to borrow. None of that is true right now. The IMF recommends confiscating all cash and then driving interest rates profoundly negative to force recovery. They remain ignorant that they have destroyed the retirement of the elderly now, as well as those who have yet retired because they command pension funds must invest in government bonds to various percentages ensuring that pensions will collapse as well. Manufacturing has been contracting compared to the service sector, even on a global basis. The latest numbers from the Institute for Supply Management's (ISM) closely monitored survey of the country's manufacturing firms (the Purchasing Managers' Index, or PMI) shows not only that manufacturing activity has contracted for two consecutive months, but that August was the lowest point for the sector since June 2009 — a time in which the economy was mired in the Great Recession. The financial markets have appeared to be disconnected from the underlying economic trends because capital smells a huge rat. Money has been shifting toward preservation rather than how much profit can it make today. Even the 10-year 3-month interest rates in the USA have tipped into the inverted yield curve, confusing many that this is a sign of impending doom. They fail to read the tea leaves that capital is looking for a place to just park. Traditionally, inverted yield curves take place during recessions, and we are in one globally heading into a significant low come January 2020. Major central banks seem trapped in an era of ultra-loose monetary policy. Very low-interest rates for an unusually long period of time involve diminishing returns and rising costs that make normalization of monetary policy increasingly difficult. While central banks have tried to "stimulate" the economy, federal, state, and local governments are in dire need of money and have been raising taxes and increasing enforcement. Government pensions are wiping out budgets in Europe, America, and Japan. The forces of the central banks have been directly opposed by the political, fiscal side of government. Central banks are trapped, stuck with ultra-low interest rates and expansionary policies that produce astonishingly little real growth. Central banks are doing nothing but print and binge on bonds, and this will ultimately create hyperinflation and a bust. The world economy is heading for the rocks of the recession, mass default, and financial collapse. The global bond markets might seem to suggest quite unprecedented downward pressure, worse than in the Great Depression of the 1930s, on economies. And they will lay all the blame on Trump and attribute this to trade rather than finance. It obviously would not be his fault; it is the result of decades of bad policy, corruption, and abuse that much should be clear to anyone long before Trump was anything more than a reality show host and a guest on WWE Monday night raw. However, what is his fault is his incessant need to brag about his stock market and take all the credit so long as it was going up, then start blaming everyone else once it started to take a downturn and show anything less than from here to eternity growth. He pegged to much of his policies' success to the markets and recently has been desperately trying to reverse course to try and avoid what amounts to a P.R. disaster. Hence the laser-like focus on the trade war and Iran. China is particularly helpful as he can peg any market issues to the trade war, and he has done just that by saying the markets would be 10,000points higher if he weren't saving America from the evil Chinese. Now that may be partially true. Clearly, U.S. and Chinese trade relations have long been in desperate need of a serious overhaul, and equally clear is that there would be some pain in the process in the event that China did not simply roll over and give Trump everything he wanted in a new trade deal. The problem, as I see it, is Trump did not prepare the American people for any adverse consequences; all he said was trade wars are fun and easy to win. That set a certain expectation with people that the U.S. was going to roll right over China and skate through this unscathed under his leadership. In fact we the people would do nothing but benefit from the hundreds of billions of dollars that would flow into the economy. Clearly, that was never a realistic approach, and all those hundreds of billions of dollars were never going to benefit the average American in a way that Trump could exploit in the way of brand management. I'm not sure what Trump's expectations are in this or what his endgame is as neither he nor his administration has laid what exactly the conditions for victory are supposed to be in this trade war. It also absolutely did not help when he claimed he could order U.S. companies out of China, regardless of whether he really can it came off as the extremely rash actions of someone who had lost the narrative and was desperately trying anything to get back on top of things. And him going after the FED was just another attempt to redirect attention away from Trump's personal responsibility for the path he is taking us down. While the FED deserves any shade thrown on it and preferably should be shut down, what Trump is demanding, they do nothing more than a continuation of the failed policies of the past. No to mention he has done nothing to address what's really going to destroy the economy in the end, out of control spending and out of control debt, in fact, he's made things worse during his term. Again overall, you can't throw this on Trump's lap as this has been a ticking nuclear bomb for generations. Maybe at this point, there is nothing to be done except delay the great reset for as long as possible. Trump will not be at fault when the next Great Recession hits, and it will hit and most likely during his presidency. Blaming or praising a president for things that they clearly do not deserve either for is just myopic cult of personality that so many Americans get caught up in. This is known as being left holding the bag, and it would happen to anyone at that post in a recession. I thought this would happen sooner, but I was wrong. Best I can come up with is perhaps Trump won't roll over and give the banks and friends the whole world and a handbasket like the last guy. Perhaps in his rage of lost power, he might take from them or establish some kind of antitrust. They need a real puppet to pillage the things they want. Hopefully, Trump won't play along. No point in bringing down the whole world if they can't buy it up for pennies on the dollar. These people didn't get to where they are by being reckless. Trump is neither a savior or villain in this; he is just a mediocre businessman who happens to win the Wrestlemania of politics.



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