Is USA heading to economic collapse?

[es20490446e]

It's starting to look like when Nero burned Rome.

Yes

No

[loveslongnails]

Like George Carlin once said: "There are a lot of effin stupid people out there!", so let's dumb this down as much as possible for the magats out there, especially the ones who think "America is getting a reboot".

* Approximately 265,000 people have been illegally fired by DOGE. Judges have ordered approximately 26,000 of them must be hired back, immediately. That order has been ignored by the Executive Branch: contempt of Court, but no arrests, no consequences. Economic impact on those fired is immediate, on USA, about 6 months.

* Dollar has weakened worldwide by 10% since November election.

* Farm subsidies have been cut off despite government program participation promising them funding. This will cause the intended bankruptcies and sell offs of properties by small businesses to corporations and foreign investors.

* China has already turned to Brazil and Mexico to match the volume of soybean and row crop purchases it previously obtained from the USA. 60% of all soybeans grown in the USA were going to China. In dollars, that's about $40 billion.

* There's been absolutely NO movement or indication that major companies are planning to bring manufacturing back to the US and accept lower profit margins. In fact, after the Trump tariffs in his first term, the uncertainty led to a trend for manufactures to relocate to Mexico, India, Southeast Asia, Turkey, and Morocco. Now that the only certainty is Trump's economic un-certainty and market manipulation, that trend is growing.

* Small businesses learned, often at the stroke of midnight, that the goods they purchased overseas not yet delivered would be tariffed and they'd be the ones paying for it, not the foreign governments, if they still wanted the goods. They were warned, they voted for it anyway.

* Last but not least, the evil twins comprised of the surviving Koch brother and Leonard Leo are SUING the Trump Administration over his illegal implementation of these tariffs. The U. S. Constitution gives control over tariffs to Congress. It doesn’t hint it, imply it, or suggest it., it SAYS IT..

The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises.

It will be interesting to see what the bought and paid for Conservative judges have to say when confronted with the choice of siding with Trump or siding with the money and power who gave them their jobs.

Executive orders can not override the will of Congress if Congress rejects them. By doing NOTHING, these orders have been allowed to operate with impunity. It's unclear if Trump would accept them being overridden anyway by the Legislative branch, since he is already in contempt of the Judicial branch.

So not only is the USA headed for financial disaster, it's headed for extinction if this keeps up.

[OneViewpoint]

@loveslongnails,

Nice factual summary. I'll ad a few points...

So the stock market (equities) collapse was just a "market correction" @AviatorTom. Last week the debt markets (bonds) cratered too. The yield on the 10 year treasury bill is up sharply as people are selling off US T-bills. That means the US can't find buyers for new debt at current interest rates. Why? Because the risk profile has changed radically. No buyers means the US can't fund itself with debt. Oops.

Banks have started to see an uptick in defaults on credit cards, car loans, mortgages, and corporate borrowing. The banks are raising liquidity concerns. As in... they don't have the cash reserves to cover what they see coming. As in... banks are worried about going belly up.

Real estate activity is cratering as people in some areas can't find buyers or banks willing to write loans or insurers willing to take on risk.

A recession is 3 consecutive quarters of negative GDP change.

Do you know what it's called when ALL asset classes are losing value at the same time? It's called a depression.

Guess which one we're staring down the barrel of right now. Equity markets crashing. Debt markets crashing. Interest rates rising. Massive inflation across all sectors of the economy. Real estate values cratering. US government cost of borrowing increasing substantially. Banks worried about running out of cash.

Yes boys and girls, we're not looking at a recession. We're looking at a depression. This is what morons voting for imbeciles owned by Oligarchs can do for you. You're gonna feel some generational pain like it's 1929 all over again. You wanted to go back to the "Good Old Days", Make America Great Again. Congratulations. Your orange Jesus and the Oligarchs took you all the way back to the Great Depression.

[loveslongnails]

@OneViewpoint Well said and indisputably accurate, unless of course you're in the cult.

[MuddyMole]

Slowly, but surely.
The root cause is social rather than economic, though, and tariffs aren't going to help one bit.
The US should continue importing low tech, low value goods (not competing with much poorer countries) - but in order to pay for them, they do need to be able to compete with China when it comes to exporting high tech, high value goods.

However, right now, the US doesn't stand a chance, because of social attitudes.
China embraces science, education and professional expertise, but the US is full of flat-earthers, anti-vaxxers, religious zealots, etc. In China, academic achievement is celebrated and demanded, while in the US, it's a source of ridicule and bullying. All of the top universities all around the world are packed with Chinese students.

Although US (and European) brands have been falling behind for a long time now, until quite recently they could still rely on their prestige to help them sell products and remain competitive, but that's no longer the case - especially in China, where consumers now prefer to buy homegrown tech.
And why wouldn't they? Imagine spending $240k on a Lamborghini Urus in this day and age - everyone knows it's really just an Audi (which is just a VW), and it's powered by an internal combustion engine (how old-fashioned!) with a mere 650bhp. In China, you could spend $200k less (yes, just $40k), and get an electric luxury SUV with 1100bhp! It's a similar story with the iPhone too.

[FreyaRed]

No. According to some "experts" China should collapsed in last 10 years at least 200 times and EU should be uninhabited bare desert.

Trump wants to weaken US$ to reduce real value of astronomic debt US govt has. This debt was taken due printing long and short time obligations. US govt has to pay in back in USD. Weak USD means those obligation won't be paid with worthless currency back. Of course owner of those obligation will be pissed.
USD will lose very likely the the status of currency used in transactions for oil or resources. On the other hand some countries devaluated their currency 3 times in last 100 years and still prosper and exist. However there is a mechanic that strengthens economy with currency devaluation. Cheap USD means, cheaper labor and US resources, what means more export and better competition of US products on international market. This will work against an economical collapse.
If I had my assets in USD I would very likely exchange it in balanced and diversified portfolio of gold, Swiss frank or EUR and real estate, that's for sure.

[NimbleOcelot]

Are you actually trying to argue that weakening the USD is a good thing?

[FreyaRed]

For US citizens it's surely bad but it's not that bad for economy and it's only way for US govt to get rid of 37 Trillion debt. US pays over 1 trillion USD annually just to paid interest and buying back long and short US obligations, while military budget is around 870 Billion (87% of a trillion).

Trump isn't the bad boy, he is a necessary scapegoat who will be sacrificed when the destructive job is done. His main task is to turn US Dollar in Zimbabwean dollar.

[NimbleOcelot]

So in other words, the rich getting richer is fine, because it's good for the economy, even if it's at the expense of the working class? You realize having a rich USD is good for the economy, right?

[FreyaRed]

Nope. Capital companies around the world own US obligations. If obligation interests are much lower than inflation in specific currency those capital companies lose money. Rich people will lose lot of money

[Kelley1]

No! That is because in ten years, the national debt will be twice as much, but the dollar will only be worth half as much. In effect, it leaves us in the same situation we are not in. Then in another ten years, the national debt will double again, but so much new money will be printed that the value of dollar will be half again.

In fifty years, the national debt will be 30 to 40 times as high but it will take $30 to buy what $1 buys now. Therefore, although it may seem we can't continue spending more than we bring, we will print enough dollars to continue without an economic collapse because in effect, nothing really changes.

[genericname85]

@Kelley1 intersting. so what do you think happens to the price of goods and services when the dollar value is reduced?

[Kelley1]

@genericname85 The same it is been for the last 100+ years. The price increases.

[genericname85]

and what happens with the living wages people make on average?

[Kelley1]

@genericname85 I don't know what "living wages" are. My guess is "living wages" is a meaningless political term. Regardless, wages are highly correlated with prices. When prices increase, wages tend to increase by a similar percentage. However, it is not always a one-to-one relationship. Prices increase when the money supply increases but wages are based on the law of supply and demand. Therefore, in the near term, prices may increase at a rate greater than the increase in wages, which appears to be the case for the last couple of decades, since, for the first time in ages, the current generation appear to be less well off than their parents.

[genericname85]

so you understand all this and you do not see a big problem there? xD that's what's sort of confusing to me

[NathanDavis]

nope... all propaganda

it should start to slow down, though... third and quarter reports have started to pop-up, which are going to further illustrate the nonsense and how futile it is, so...

[Anonymous]

Yes.
Because of ONE moron.
Trump is the moron.

He openly celebrated at the crashing Stock Market, only reason why it went up was because of his 90 day pause on most tariffs.

This is a man who is ignorant and will lead us to economic ruin. Inflation, shrinkflation, etc. have gotten worse under this piece of shit.

Tariffs are a tax on an import company, not a country. Google it.

[Opinion Owner]

The tariff situation is not good, he has not been transparent about anything. As a former supporter of his, he tends to claim ‘I have a plan’ then does things on instinct rather than a well formed plan. I view leaders as needing to showcase their strategy in depth to allow the public (whether they like him or not) to analyze every piece and pick out what works / what doesn’t work. When you act like a bull in a China shop, fear will be derived from confusion among the American public.
One. He increased the total tariff amount from $78 billion to $718 billion and not on specific goods / products or material, it seems to be based on the country of origin which is baffling a lot of economists. My top concern from this is, small businesses / consumers are going to be squeezed the hardest into submission. When you make a product for a local community and your supplier’s location in the world is a place being heavily tariffed, you’ll have to raise prices since you are going to be paying more for the materials to be shipped to you. A tariff is a tax on an import company, this import company increases the tax on the corporations moving their goods to be imported there, then the corporations put a tax on the consumers. Since no one likes to lose money, you want to make money.
I don’t think I’m explaining this the best I can, though to boil it down 1. Not having a clear plan written up is leading to confusion which leads to fear among the American public and 2. Tariffs are a tax on an import company which means the importer will push new tax to be reciprocated onto corporations to not lose money in which the corporations will push inflation / shrinkflation / new prices onto the consumer to not lose money too.

[Lliam]

It's been heading for economic collapse for decades. I don't know if Trumps policies will help or hurt at this point. All we can do is wait and see.

[Darklydarkened]

Collapse is coming in the shape of middle class losing its wealth. Is Trump targeting to mend that? No, he just wants to keep US hegemony intact.

He isn't trying to save "your economy"

[Lliam]

@Darklydarkened. Whatever you say. How long has the middle class been losing its wealth? Things were great for a while after WWII. I'd say it started declining under Bill Clinton. And Biden sure fucked us over.

[blackeagle007]

Obviously you forget what happened under g. w.

[Lliam]

@blackeagle007. Oh,, I didn't forget that. The coup against the Constitution.

[blackeagle007]

I dunno what that is. But I ment how bad the economy was under his watch

[AviatorTom]

We had a long-overdue correction in the stock market. What's the big deal?

Most economic statistics are looking good. Most financial "experts" who said a recession was inevitable have changed that opinion.

[genericname85]

it has been for quite a while and it still is. they are making more and more dept every ear. which by itself isn't a problem. but they are accumulating so much debt that they are paying a significant portion of the budget simply on interest. every private person who did that would have a terribly low credit score and every financial advisor would tell them to immediately change their behavior cause bancruptcy is guaranteed if nothing changes.

[DrPepper12]

Yes. Plus the tulip bubble, sack of Baghdad by the Mongols, Cortez & the Aztecs, battle of Trafalgar, sale of Manhattan Island to the Dutch, trail of tears, triangle trade, niké riots, Operation Barbarossa and so much more...

[Luopio27]

Not just America but the whole world with it. The dam wars in the streets, the wars in middle eadt, the wars in Russia/Ukraine.


It all is nothing but terror, death, destruction & debt!

[WindAtMyBack]

No. There is absolutely no reason to think so. The idea is absurd.

[bddddd]

The USA is moving there slowly. Hopefully by the end of his term the furniture will still be intact.

[Pohjolan]

Impossible to say at this point.

USA doesn't currently have a long term economic policy and it's short to medium term policy is not entirely based on reality.

[Shiprex]

The smart people in US will soon squish the Chump in charge before irreparable damage is done.

[FunkyMonkee]

Just the opposite! We nearly had an economic collapse over the previous 4 years!!

[Avicenna]

Only if you listen to deranged leftists. Collapse is something really extreme.

[RingOfFire]

"It's starting to look like when Nero burned Rome."

Only if you're dumb enough to fall for the fake news.

[Kelly6]

@es20490446e Maybe or Maybe no, but US is investing too much in War profit just like Rome did.

Rome’s fall had multiple reasons, one was also that it depended lot on war profit

[exitseven]

No, the US is undergoing a reboot and will come out better.

[Dargil]

It was under Democrats. President Trump may save it or he may not. Depends in Congress.

[Filthy_Immigrant]

No, if it didn’t collapse months ago when democrats were running the show then it’s less likely to happen now

[DCVsMarvel2]

It's what putin wants. It's always been Russia vs. U. s. with a bunch of proxy wars in between. Trump, is a putin puppet

[ABC1x1x]

It's going to sell all of it's gold to buy 30% of the Bitcoin Network and be permanently the strongest nation on the planet in 4 to 8 years.

[Phoebe85]

Yes it what he does. He’s gone bankrupt 6 time.

[beefcakebradybatson]

Trump and his cohorts are burning and sacking America !!!

[jimmy2]

Not just US but rather the world. All countries are on a war footing

[abc3643]

No. It's headed to an assassination.

[Sluttt]

Donald banckrupt 6 times

[Sluttt]

I can see how he did it

[Sluttt]

America was selling their dreams now the world is waking up

[robocop666]

look at the national debt, its YUGE

[Jerre]

Not at all.