Entries by David Stockman

How to Cut $2 Trillion of Fat from the Federal Budget

Estimated Reading Time: 6 minutes

A goal of $2 trillion of budget savings is crucial to the very future of Constitutional democracy and capitalist prosperity in America. In fact, the soaring public debt is now so out of control that the Federal budget threatens to become a self-fueling financial doomsday machine. So more power to the DOGE of Musk and Ramaswamy. In spades! For want of doubt, just recall this sequence. When Ronald Reagan was elected in 1980 on a call to bring the nation’s inflationary budget under control, the public debt was $1 trillion. By the time Donald Trump was elected the first time it had erupted to $20 trillion, which has now become $36 trillion. And under current built-in spending and tax policies it will hit $60 trillion by the end of the current 10-year budget window.

What Did $6.5 Trillion in Money Printing Achieve?

Estimated Reading Time: 7 minutes

Here we go again. The Fed has spent the last 16 years fueling the mother of all financial bubbles on Wall Street. And by way of spillover effects on the mortgage market, it has also fostered parallel bubbles in commercial and residential real estate assets alike, across the length and breadth of the land. Now […]

Here Is What Stagflation Looks Like

Estimated Reading Time: 4 minutes

Yes, we have some stagflation. Subsequent to the pre-Covid peak in Q4 2019, real final sales of domestic product have slowed to a crawl, rising by just 0.73% per annum during the last 2.5 years. We much prefer this measure over real GDP because it removes the abrupt inventory swings from quarter to quarter, which can have […]

Weekend Read: Inflationary Pressure Is Worse than They Say

Estimated Reading Time: 8 minutes

We are apparently back in the spend-your-way-to-prosperity mode. Last week Wall Street greeted the “strong” April PCE [Personal Consumption Expenditures] number with a spree of dip-buying, but you have to wonder just how long households can keep reaching into their cookie jars in order to spend what they are not earning. According to the Commerce […]

Real Personal Income Down 20% from One Year Ago

Estimated Reading Time: 8 minutes

Editors’ Note: Some readers may find it offensive to see the criticism of Donald Trump. We think Trump did many good things and we admire his courage. However, he and the Republican leadership did abandon one of the key elements of conservative Republicanism, fiscal prudence. Yes, he was bullied by the medical establishment, but the […]

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