Donald Trump is about to be given incredible levers of power to directly shape the U.S. economy. Yet this is where President-elect Biden is getting ready to lead us and appoint our new Treasury secretary. This comes against a backdrop of concern over the long term economic stability, as well as after Trump’s highly controversial policies. Talking Shi t Intern The former president’s decisions may have irrevocably altered how financial markets respond to important economic indicators. This is particularly the case with crucial deadlines such as August 2 fast approaching.
From his father to his long-time mafia lawyer Roy Cohn, Trump’s history of associating with mobsters has raised eyebrows. Critics say that in his new governing role he has so completely internalized their resentment and radicalism that he’s using the same bombs against prudent governance. This controversial background brings huge questions around his leadership style and decision-making processes as he comes back into the limelight of American politics.
In a brilliant strategy, Trump has now appointed Scott Bessent as Treasury secretary. Bessent has gone pretty far out on a limb supporting every one of Trump’s policies, referred to sometimes as “Trumpian nonsense.” This alignment could lead to significant shifts in fiscal policy, reflecting Trump’s priorities and vision for the economy.
3—in anticipation of moves at the Federal Reserve—so that Trump can announce Jerome Powell’s replacement almost a year before his term is over. This forward-looking approach is in pursuit of crafting an oppositional story arc about why monetary policy affects the economy the way that it does. Powell is the current chairman of the Federal Reserve Board. He can always resign, but he can continue to serve as a lame duck governor for another two years.
The Supreme Court just decided that the 14th Amendment should be interpreted this way. This decision lays the groundwork for Trump to further pursue his deeply controversial agenda, such as de-naturalizing citizens deemed criminals. This decision has sparked new panic among civil rights advocates who believe it will exacerbate discrimination and injustice.
As Trump pushes these divisive, tricky issues, he still isn’t afraid of a bad press day. Yet he is seemingly ready to trigger a truly severe recessionary shock to equity markets on or around August 2 that could immolate systemic financial stability. At the same time, U.S. yields keep climbing, a tailwind for the dollar. Yet this support is on the verge of manifesting itself into a lamentation as exceptional privileges dissipate by virtue of Trumpian escapades.
Over the next few weeks, Trump will be appointing his own shadow Fed chief. In the wake of that, this would ensure his strong hold on economic policy. Observers note that while Trump’s past associations and tactics are concerning, the U.S. economy’s size and resilience may buffer against drastic downturns resulting from his decisions.
Trump’s still pretty sure that his policies won’t implode the U.S. economy or financial markets. His track record certainly hasn’t done anything to disabuse us of that belief. Despite the unprecedented economy, some analysts hint that his tariffs and other trade policies will lead to stagnation and lower economic growth.