The Economy

In the case of Trump, I was always quick to say that the stock market gains weren't because of him per se. I mean, mailing out "stimulus" checks to people with a central bank monetizing increasing debt loads cetainly was the cause, but it was really Jay Powell creating a stock market bubble, not Donald Trump. The debt monetization is what is creating inflation, not the trillions of dollars of new debt constantly being created itself pouring liquidity into risk assets and turning anything risky into a casino. The debt couldn't have happened. ... without debt monetization ... and it's that monetization that is sending prices of risk assets higher and higher (and also creating serious instability beneath it). So it was never really Trump. ... it was Jay Powell. And most Americans are clueless about this.

In the case of Biden. ... We have running up a trillion dollars of new debt every 100 days under him. His brand of reckless populism turned it into an even more berzerk game. This is not a good thing for the long-term health of the country.That debt has been massively inflationary (and what you are talking about in stocks is simply an effect of massive monetary inflation). In the shorter term, the inflation which was more limited in its effects to risk asset bubbles in the decade + before (because this predates Trump and Biden, it's a story of the radical monetization of debt that became the norm after the financial crisis as we got very irresponsible to try to avoid dealing with a debt problem), spilled over into consumer price inflation that is kicking half the country in the ass and has created an intractible situation for the real architect of those stock market gains:



Right now, the Fed is trying to get us through the election without pulling the rug out from under the facade, because they don't want to be seen as influencing the election. They will absolutely tank the economy and the stock market will deflate if they did what they needed to do to deal with the runaway consumer prices problem we now have as a result of all the recklesness. They are praying they can keep some kind of statsis until December, wthout a banking crisis, without CPI prints that get too out of hand (they have no credibility), and without masive defaults on debt kicking in due to the show of raising short-term interest rates (while pumping liquidity in to try to counteract it via Reverse Repos and pulling back on tapering the size of the massive balance sheet they created). Financial conditions are so loose, M2 money supply is expanding again. ... and yeah, we are seeing it get the "animal spirits" going again in the stock market. None of that is a good thing for the healht of the country.