Guest Post by Peter Schiff
The most likely legislation Congress can pass that Trump will sign will preserve all the tax cuts Trump brags about but include all the extra spending that Democrats want. It may also contain a complete repeal of the national debt ceiling and price controls on credit card interest rates. The result will be massive increases in already massive federal budget deficits.
If the economy also slips into recession due to a big slowdown in AI capex, budget deficits currently running at around $3 trillion annually could rise to nearly $5 trillion. That will send the national debt soaring to $50 trillion by the end of Trump’s term. To accommodate those massive deficits, the Fed will open up the monetary spigots like never before, launching the mother of all QE programs. The U.S. dollar will tank, and consumer prices will go through the roof.
This will also put substantial upward pressure on long-term bond yields and mortgage rates, crushing the economy and housing market. To avoid a worse financial crisis than in 2008, the Fed will choose higher inflation instead and buy Treasuries and MBS in record amounts. Since the Fed won’t buy corporate or municipal bonds, expect those yields to soar, wreaking havoc on state and local governments and the stock market.
Since credit card interest rates will likely be capped, expect most consumers to be completely cut off from credit. If price controls extend to consumer goods, expect shortages, long lines, black markets, widespread power outages, and civil unrest.
Since the war can’t really end unless we surrender by caving in to Iran’s demands, it will likely continue. Since the Strategic Petroleum Reserve will run dry if we don’t stop the drain, oil prices will rise sharply, perhaps to $150–$200 per barrel. Even if Trump manages to end the war by promoting a defeat as a great victory, oil prices will rise anyway.
The 2028 election will be a blame game, with each party accusing the other of being responsible for the worst economy ever and the highest inflation in U.S. history. Voters have a track record of blaming presidents and their parties for the affordability crises, so not only will the Democrats win the White House, but they will also increase their majorities in both houses of Congress, likely reaching a filibuster-proof 60 seats in the Senate. Their policies will risk turning record-high inflation into hyperinflation.
The only thing you can do now is protect yourself, as there is nothing you can do to protect the country. In fact, by not going broke like the vast majority of Americans will, you will be better positioned to help rebuild what both Democrats and Republicans will have destroyed.
Load up on gold and silver now while you can still afford to buy them.
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[ H/T The Burning Platform ]
The most likely legislation Congress can pass that Trump will sign will preserve all the tax cuts Trump brags about but include all the extra spending that Democrats want. It may also contain a complete repeal of the national debt ceiling and price controls on credit card interest rates. The result will be massive increases in already massive federal budget deficits.
If the economy also slips into recession due to a big slowdown in AI capex, budget deficits currently running at around $3 trillion annually could rise to nearly $5 trillion. That will send the national debt soaring to $50 trillion by the end of Trump’s term. To accommodate those massive deficits, the Fed will open up the monetary spigots like never before, launching the mother of all QE programs. The U.S. dollar will tank, and consumer prices will go through the roof.
This will also put substantial upward pressure on long-term bond yields and mortgage rates, crushing the economy and housing market. To avoid a worse financial crisis than in 2008, the Fed will choose higher inflation instead and buy Treasuries and MBS in record amounts. Since the Fed won’t buy corporate or municipal bonds, expect those yields to soar, wreaking havoc on state and local governments and the stock market.
Since credit card interest rates will likely be capped, expect most consumers to be completely cut off from credit. If price controls extend to consumer goods, expect shortages, long lines, black markets, widespread power outages, and civil unrest.
Since the war can’t really end unless we surrender by caving in to Iran’s demands, it will likely continue. Since the Strategic Petroleum Reserve will run dry if we don’t stop the drain, oil prices will rise sharply, perhaps to $150–$200 per barrel. Even if Trump manages to end the war by promoting a defeat as a great victory, oil prices will rise anyway.
The 2028 election will be a blame game, with each party accusing the other of being responsible for the worst economy ever and the highest inflation in U.S. history. Voters have a track record of blaming presidents and their parties for the affordability crises, so not only will the Democrats win the White House, but they will also increase their majorities in both houses of Congress, likely reaching a filibuster-proof 60 seats in the Senate. Their policies will risk turning record-high inflation into hyperinflation.
The only thing you can do now is protect yourself, as there is nothing you can do to protect the country. In fact, by not going broke like the vast majority of Americans will, you will be better positioned to help rebuild what both Democrats and Republicans will have destroyed.
Load up on gold and silver now while you can still afford to buy them.
Tweet
Continue reading...
[ H/T The Burning Platform ]
