I question the validity about liquidity issues. The Bank of Canada has currency swaps with EU, Japan, South Korea, China, and the UK. We should be able to have Euro denominated trade in a pinch, or USD collapse.
Stopped listening when Eichengreen said that the US economy was healthy until bad orange man came over and kicked the hornet nest.
Let’s be serious for once:
• An economy having 38 trillion dollars (38,000,000,000,000 $) debt IS NOT (cannot be) healthy
• An economy having an annual deficit of 2 trillion dollars (to put it in perspective, that’s close to Canada’s GDP) that must be financed, adding to the monster quantity above, IS NOT healthy
• An economy where the debt-financed government expenses represent 20+ % of the GDP (that figure is considerably higher in Canada, BTW) IS NOT healthy
• An economy having a bankrupt social net IS NOT healthy
• A stock market valued close to 30 times earnings as a whole IS NOT healthy
I don’t know if tariffs (and everything else the Americans are currently trying to do) are the solution. What I do know is that something must be done before the American economy (and the world economy with it) collapses, and despite the horrible way it is being handled and communicated, Trump is trying to do just that, no matter the political consequences, instead of keep kicking the can down the road like everyone else has done so far (and are doing in Canada). He has my respect for it.
Cheery thought, on the pushback you got on loosing reserve status being nflationary, and he pushed back saying the Fed would control the inflation: that assumes the Fed's independence. Trump wants low interest rates. If the Fed is taken over, all bets are off...
Fascinating discussions. Mr. Trump's capricious behaviour makes predictions impossible, but our response need not be reactionary but considered.
We remain the Two Solitudes. Perhaps I missed it but did the English MSM report on how all parties except the CPC have signed on to « Consensus québécois en environnement »? Moderate, by Quebec standards, but tells you who drives the bus.
And yet the US economy was growing as it has consistently in the post war era, and being the central reserve upon which the global economy rests affords it the opportunity to borrow and borrow. Agreed - that can’t be good indefinitely but that position has always come with some responsibility. Its not likely that Trump will be able to reign in his deficit, provide a tax break , bring manufacturing back to the U.S. and contribute to the global economic system that has made the US the richest country in history. The domino effect of this irrational and ridiculous tarriff strategy is likely to tank the US economy.
Thanks Jen. The most informative, interesting, serious, right- on- point podcast from The Line. Pure excellence. And the questions not quite yet formulated but bouncing around my brain were asked and answered in clear language by both guests.
What gives me great solace is economists only reliability seems to be in being wrong. (And then not paying the price for being wrong). I remember Long Term Capital, the Great Recession, COVID...
I better suit the profile of a Walmart greeter these days. Isn’t that where guys go after politicians eviscerate their life’s savings and inspire rebellion?
I chuckled because whenever Jen says economists, there is usually a "we love you, but...." As in after the carbon tax letter: "we love you, but read the room." So for her to be serious fan-girl was great. No better guest than Barry Eichengreen to talk about the history of economic disasters. As Jen and Matt pointed out during Jen's Friday rant, experts aren't always rihgt. but it is not because they are dumb
No coincidence that Trump announced his tariff "pause" just as soon as markets found a new bottom and levelled off. It's becoming fairly clear that Trump is using his big unilateral economic lever to deliberately crash and revive the stock markets at will, while his allies and surrogates are insider trading on a scale never seen before in history.
Dear God, to have 15 minutes' warning before his announcements last Wednesday and today, I could have bought the craziest amount of options and made more money than I need for the rest of my life.
However, it seems like every time he does this it needs to be more extreme, random, and harmful to assure the markets that he "means it this time" otherwise he won't get the crash that his short positions require.
I have trouble taking these announcements as seriously as many others - particularly voters in Canada who think determining who has the best vibes on vaguely "dealing with Donald Trump" is the number one election issue. Nonetheless, there is a very real hazard that one of Trump's market manipulations will result in an uncontrollable economic disaster as a side effect.
Look I understand Mr Eichengreen is highly regarded but can we find another expert in the dismal science who will tell us not to do that? I'm scared guys
A big picture item that should become a national project along the lines the the trans Canada highway - you know, nation building. That project needs to be done, full stop. Everyone in Canada has a right to clean drinking water. It was supposed to be done by 2021. First nations clean drinking water now, please. Might even be a big step toward reconciliation.
I question the validity about liquidity issues. The Bank of Canada has currency swaps with EU, Japan, South Korea, China, and the UK. We should be able to have Euro denominated trade in a pinch, or USD collapse.
Stopped listening when Eichengreen said that the US economy was healthy until bad orange man came over and kicked the hornet nest.
Let’s be serious for once:
• An economy having 38 trillion dollars (38,000,000,000,000 $) debt IS NOT (cannot be) healthy
• An economy having an annual deficit of 2 trillion dollars (to put it in perspective, that’s close to Canada’s GDP) that must be financed, adding to the monster quantity above, IS NOT healthy
• An economy where the debt-financed government expenses represent 20+ % of the GDP (that figure is considerably higher in Canada, BTW) IS NOT healthy
• An economy having a bankrupt social net IS NOT healthy
• A stock market valued close to 30 times earnings as a whole IS NOT healthy
I don’t know if tariffs (and everything else the Americans are currently trying to do) are the solution. What I do know is that something must be done before the American economy (and the world economy with it) collapses, and despite the horrible way it is being handled and communicated, Trump is trying to do just that, no matter the political consequences, instead of keep kicking the can down the road like everyone else has done so far (and are doing in Canada). He has my respect for it.
Cheery thought, on the pushback you got on loosing reserve status being nflationary, and he pushed back saying the Fed would control the inflation: that assumes the Fed's independence. Trump wants low interest rates. If the Fed is taken over, all bets are off...
Fascinating discussions. Mr. Trump's capricious behaviour makes predictions impossible, but our response need not be reactionary but considered.
We remain the Two Solitudes. Perhaps I missed it but did the English MSM report on how all parties except the CPC have signed on to « Consensus québécois en environnement »? Moderate, by Quebec standards, but tells you who drives the bus.
And yet the US economy was growing as it has consistently in the post war era, and being the central reserve upon which the global economy rests affords it the opportunity to borrow and borrow. Agreed - that can’t be good indefinitely but that position has always come with some responsibility. Its not likely that Trump will be able to reign in his deficit, provide a tax break , bring manufacturing back to the U.S. and contribute to the global economic system that has made the US the richest country in history. The domino effect of this irrational and ridiculous tarriff strategy is likely to tank the US economy.
Thanks Jen. The most informative, interesting, serious, right- on- point podcast from The Line. Pure excellence. And the questions not quite yet formulated but bouncing around my brain were asked and answered in clear language by both guests.
What gives me great solace is economists only reliability seems to be in being wrong. (And then not paying the price for being wrong). I remember Long Term Capital, the Great Recession, COVID...
South Park nailed the dismal profession: https://youtu.be/wz-PtEJEaqY
Time to start looking for a job again, I guess.
At Walgreens?
I better suit the profile of a Walmart greeter these days. Isn’t that where guys go after politicians eviscerate their life’s savings and inspire rebellion?
In Canada they learn French, move to Ottawa, and apply for a civil service job…
Was remembering so many seniors in Florida working in the grocery stores.
That'll be me!
I chuckled because whenever Jen says economists, there is usually a "we love you, but...." As in after the carbon tax letter: "we love you, but read the room." So for her to be serious fan-girl was great. No better guest than Barry Eichengreen to talk about the history of economic disasters. As Jen and Matt pointed out during Jen's Friday rant, experts aren't always rihgt. but it is not because they are dumb
No coincidence that Trump announced his tariff "pause" just as soon as markets found a new bottom and levelled off. It's becoming fairly clear that Trump is using his big unilateral economic lever to deliberately crash and revive the stock markets at will, while his allies and surrogates are insider trading on a scale never seen before in history.
Dear God, to have 15 minutes' warning before his announcements last Wednesday and today, I could have bought the craziest amount of options and made more money than I need for the rest of my life.
However, it seems like every time he does this it needs to be more extreme, random, and harmful to assure the markets that he "means it this time" otherwise he won't get the crash that his short positions require.
I have trouble taking these announcements as seriously as many others - particularly voters in Canada who think determining who has the best vibes on vaguely "dealing with Donald Trump" is the number one election issue. Nonetheless, there is a very real hazard that one of Trump's market manipulations will result in an uncontrollable economic disaster as a side effect.
We're... going to have to resort to government spending to stabilize the economy? Great
Hopefully the Liberals will be judicious in their use of fiscal policy
Look I understand Mr Eichengreen is highly regarded but can we find another expert in the dismal science who will tell us not to do that? I'm scared guys
A big picture item that should become a national project along the lines the the trans Canada highway - you know, nation building. That project needs to be done, full stop. Everyone in Canada has a right to clean drinking water. It was supposed to be done by 2021. First nations clean drinking water now, please. Might even be a big step toward reconciliation.