As part of a long social media tirade unleashed on the masses Wednesday morning, Donald Trump weighed in again on the state of the economy and trade talks with China.
At this point, it is abundantly clear that he isn’t doing himself any favors when it comes to market sentiment and public confidence by incessantly bringing up a recession, but at the same time, the president seems to believe that now is the time to drive the point home when it comes to setting up the Fed, the media and Democrats to take the fall if the economy does roll over.
“The Fake News LameStream Media is doing everything possible the ‘create’ a US recession, even though the numbers & facts are working totally in the opposite direction”, Trump said, on the way to assessing that the media “would be willing to hurt many people, but that doesn’t matter to them”. “Our Economy is sooo strong, sorry!”, he went on to chide.
The president’s rhetoric is now bordering on the same kind of dangerous incitement to violence implicit in his characterization of the media as “enemy of the people”.
He is now trying to instill in his base the idea that the media can somehow “create” a recession, when, in reality, the person who is doing the most to perpetuate fear is the president himself, by raising the specter on an economic downturn over and over again on Twitter to 64 million people.
Over the past 48 hours, the media has amplified the recession story, but only because sources have told multiple outlets that the administration is looking at contingency plans including tax cuts, to help avert a downturn. Trump himself confirmed the tax cut discussions (both with respect to the payroll tax cut idea and the ongoing debate around indexing capital gains to inflation) on camera, at the White House, on Tuesday. Later, Politico reported that Mick Mulvaney essentially admitted that a recession was possible earlier this week at a closed-door luncheon with GOP donors.
The president continued to harangue the Fed on Wednesday ahead of the release of the July meeting minutes and Jerome Powell’s hotly-anticipated remarks in Jackson Hole on Friday.
“Doing great with China and other Trade Deals. The only problem we have is Jay Powell and the Fed”, Trump said, before re-upping his infamous golf allusion which led directly to the Christmas Eve stock market crash. “He’s like a golfer who can’t putt, has no touch”.
Relive the moment when Trump sparked the Christmas Eve Wall Street massacre with original Powell golf tweet
A delirious Trump persisted on Wednesday. “Big US growth if [Powell] does the right thing, BIG CUT – but don’t count on him!”, the president shouted into the digital void, before assessing that “so far [Powell] has called it wrong, and only let us down”.
For good measure, he rounded things out with a dollar diatribe (or what counts as a “diatribe” by Twitter standards):
We are competing with many countries that have a far lower interest rate, and we should be lower than them. Yesterday, “highest Dollar in US History.” No inflation. Wake up Federal Reserve. Such growth potential, almost like never before!
For the record, rates are much lower in the US than they are in China, and as far as the US being “lower than them” vis-à-vis Europe and Japan, that would entail the Fed cutting rates into negative territory.
It’s not clear whether Trump even realizes he just demanded negative rates in the US, but he did – at least to the extent he’s referencing the ECB and the BoJ, which seems likely considering trade discussions with Europe and Japan are ongoing.
Calls for NIRP (intentional or no) aren’t even remotely consistent with the idea that the US economy isn’t headed for a downturn and, notably, fly in the face of what the president’s own Fed pick Judy Shelton has repeatedly said about the dangers of negative rates.
Meanwhile, Global Times editor Hu Xijin suggested in a tweet of his own that if the US tries to link the trade talks to Hong Kong, Beijing will “scorn the idea”.
Somewhat ominously, Hu also said “China is making arrangements on [the] scenario of no deal”.