Quote:
Originally Posted by Bladewire
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i'm sorry but the person who wrote this article doesn't know much about economics. the dow jones can't be an indicator in this case because its rise was a simple reaction to the tax cuts.
with shares, the investors buy shares in the company value. if a company pays less tax, however, this value rises because these profits are invested for the most part in fixed assets in order to also save the remaining tax as best as possible.
unfortunately, most companies were already overvalued and the shares were 3 times as expensive as the actual company value. so here was hot air traded - similar to bitcoin.
trumpīs economic policy is based on the insane assumption that tax cuts have a direct impact on profits and that lost taxes are offset by higher profits. how absurd this is can be seen from the fact that this would presuppose that every company and every consumer would suddenly have 2.5 times as much money at their disposal to offset the loss - or that the money would have to turn 2.5 times faster in the cycle.
and even then the same tax revenue would only be achieved.
but america has so many debts that it needs MORE taxes and not less.
in addition, such an influx of consumption would lead to accelerated inflation, which can only be combated with higher interest rates. these higher interest rates then also directly affect the 22 trillion debts that have not been repaid for decades but increased.
and now we have several foreseeable effects together.
1. the companies will continue to be traded above their value.
2. corporate profits are at risk due to trumpīs economic policy
3. tax revenues have plummeted and the state is facing bankruptcy
4. companies migrate abroad to circumvent trumpīs trade restrictions. jobs are lost and consumption is reduced. this will paralyze the domestic economy.
all of this only leads to the conclusion that sooner or later the tax gifts MUST be withdrawn - in a phase in which the economy is already ill.
Interest rate cuts that allow cheap loans to get the economy going again are not possible because trump has previously prevented the necessary interest rate increases.
What is happening here is hopeless and can no longer be regulated with financial instruments.
since america is indebted throughout the world and an american crisis is pushing purchasing power down all over the world, this is not just an american crisis, but the biggest economic crisis in the history of the world.
and therefore the saying that foreigners stay out of discussions about american politics is pure nonsense, because trump not only destroys america - he sets the whole world on fire.