“This was a speech to basically say ‘I think we need some perspective and let’s look at what’s happened under this administration'”, Steve Schwarzman said, in an interview with Bloomberg TV.
He was commenting on Donald Trump’s address at Davos. “That is not just for domestic consumption, it’s meant to be heard in the broader context”, Schwarzman went on to muse.
You can just ignore that assessment. Trump’s speech was an unmitigated disaster.
“Today I’m proud to cluair that the United States is in the midst of an economic boom the likes of which the world has never seen before”, Trump said, viciously murdering the word “declare” on the way to leaving little doubt that the current occupant of the Oval Office suffers from acute delusions of grandeur.
Trump’s economic boasts used to contain kernels of truth, even if you sometimes needed a microscope to find them. Now, he doesn’t even try.
There are, in fact, any number of economic data points the president can point to in the course of talking up America’s economic prowess, and he did allude to some of them on Tuesday. But the blanket claim that the US economy (which, at last check, was growing at a 2.1% clip) is “in the midst of an economic boom the likes of which the world has never seen before” is so wildly ridiculous that even when you consider the source (Trump) it’s hard to fathom the sheer scope of the exaggeration – the audacity of the balderdash.
Again, there is plenty to like about the US economy in 2020. The consumer is quite healthy by most accounts and the services sector never really caught down to the factory slump that started to manifest in PMIs during the dog days of summer.
But business spending has been a drag for two consecutive quarters, corporate America is entering an earnings recession (assuming estimates for Q4 EPS hold) and ISM manufacturing is still sitting at the lowest since the crisis, consistent with a roughly 1.5% pace of expansion for the broader economy.
One more time: There are a ton of nice things you can say about the US economy. Indeed, you could conjure a fairly long list of economic accomplishments attributable in one way or another to Trump-o-nomics.
But, there is no sense in which the US economy is experiencing a miraculous boom of historic proportions that will be immortalized in the history books as some kind of epic renaissance, as Trump suggests. That is wholly absurd.
The rest of Trump’s Davos address was equally ridiculous. He claimed, among other things, that he is responsible for a “blue collar boom”, that he has created “the most inclusive US economy ever”, that US relations with China “have never been better” and that he and Xi Jinping are in love. “He’s for China and I’m for the US, but other than that, we love each other”, Trump tried to joke.
He also didn’t miss an opportunity to malign Jerome Powell. Here is the moment when Trump, – in Davos, mind you – decried the Fed:
“We’re competing with nations that are getting paid to borrow money”, the US president told the crowd, as though the luminaries gathered at the World Economic Forum are somehow unaware of the current state of monetary policy. “[That’s] something I could get used to very quickly”, Trump added.
Commenting further on the utopia he imagines the administration has created back home, Trump declared the American dream “back, bigger better and stronger than ever before”.
“I see such tremendous potential for the future”, he added. “We have not even started, because the numbers we’re talking about are massive”.
Now please, Steve Schwarzman, tell us again about how it’s everyone else who “needs some perspective”.