Trump's Next Move : Devalue The Dollar

Trump is using the tools normally reserved for recession times, when the next one comes, and they always do, there will be nowhere to turn. Buckle up and start planning now! Welcome to The Atlantis Report . President Trump has waged war on the U.S. Federal Reserve (Fed) for more than a year, launching salvos of tweet-bombs laced with criticism and ridicule. Trump’s main points have been that the Fed is too hawkish, and the U.S. dollar is too strong. Politics have made matters worse. But the Fed shows no interest in taking the more proactive approach to policy that Trump would like to help outflank China. Chinese authorities have not indicated that they will bend on U.S. trade demands. Trump cannot raise tariffs again without risking recession. Fiscal stimulus is unlikely. The one lever left is the U.S. dollar. Well, yeah, there is that, the dollar. Trump hasn't ruined that yet. Following right in Nixon's footsteps. Nixon fired the Fed chairman, and installed a crony who cut interest rates. Then he took us off the gold standard which devalued the dollar. Result: Mortgage interest rates as high as 18% through the 1970s and into the 1980s. Why did Nixon do it? The same reason Trump wants to do it: TO MASK THE COMING RECESSION BEFORE THE ELECTION. But the real question is whether a currency devaluation will really avert a coming recession. Would the world which is sliding into recession really "Buy American!" Would the world not retaliate with their own devaluations, particularly if their economies are decidedly worse than ours . Would a currency devaluation suddenly motivate Americans to "Buy American" widgets we might have no need. Devalue the dollar and foreign investors will stop financing the national debt. Interest rates will rise and the economy will tank. IF this comes about this will precipitate a race to the bottom. Trump doesn't care about bankrupting the US. 2020 cannot come fast enough when we can show this failure the door. We know Trump has at $1 billion in variable rate loans. Starting the trade war and having the Fed reduce interest rates benefits him greatly. That’s why we want to see his tax returns. If he owes $20 billion in variable loans, a single point enriches him by $200 million. If Trump thought a dollar devaluation would prop up his failing real estate portfolio he would devalue the dollar tomorrow. Everything he currently does is motivated by the fact he is in serious financial distress.




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