November 10, 2016

Why didn't the stock market crash when Trump won — like the experts said they would?

Ben Casselman looks into the wrong/bullshit prediction:
Investors didn’t necessarily want Trump to win...
You could stop right there. That's the answer. These people were lying to scare us out of voting for Trump.
... (although many probably liked some of his proposals, such as lower corporate taxes and reduced regulation), but even more than that they feared the chaos that could result from an uncertain or disputed outcome....

A few weeks back, I warned that it was risky — even irresponsible — to confidently predict how markets would react to a Trump victory. But it is just as unwise to read too much into one day of trading....

Even more uncertain is the effect that Trump’s victory will have on the economy as a whole.... But it’s too early to say how much of Trump’s agenda will be enacted.... Not all of Trump’s proposals would necessarily be bad for the economy. He wants to boost infrastructure spending, a position that’s broadly supported by economists (although Trump hasn’t given many details). He wants to implement a new tax deduction for child care expenses and expand the Earned Income Tax Credit. Some elements of his tax plan, such as eliminating the estate tax and lowering the corporate income tax rate, hew to standard conservative orthodoxy, although he departs from it in other ways.....
That reminds me. A day after hearing Trump's victory speech and thinking about what he would actually do in his endeavor to be a great President (which I believe he means to be), I thought of this paragraph:
We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals. We're going to rebuild our infrastructure, which will become, by the way, second to none. And we will put millions of our people to work as we rebuild it.
The man is a builder, and I think he can get these things built. Do that as your signature achievement, and we'll love it. Don't mess anything else up, and it will be enough.

ADDED: Don't forget: Obama wanted to build the infrastructure. He cared about putting people to work, and he got played out of it. In 2011, I wrote about how he got played. Read that and think about what a different political environment Obama had to operate within:

Here's a fascinating passage from Ron Suskind's new book "Confidence Men: Wall Street, Washington, and the Education of a President" (pp. 18-19)(boldface added). Obama and his advisers are plotting campaign strategy in August 2007 and the subject turned to the problem of jobs for 10 million low- to moderately skilled male workers. What "sunrise" could the government subsize and stimulate. The advisers hit on health care:
That was where the jobs would be: nurse’s aides, companions to infirm seniors, hospital orderlies. The group bandied about ideas for how to channel job-seeking men into this growth industry. A need in one area filling a need in another. Interlocking problems, interlocking solutions. The Holy Grail of systemic change.

But Obama shook his head.

“Look, these are guys,” he said. “A lot of them see health care, being nurse’s aides, as women’s work. They need to do something that fits with how they define themselves as men.” ...

As the room chewed over the non-PC phrase “women’s work,” trying to square the senator’s point with their analytical models, [Alan] Krueger—who was chief economist at the Department of Labor in the mid-1990s at the tender age of thirty-four—sat there silently, thinking that in all his years of studying men and muscle, he had never used that term. But Obama was right. Krueger wondered how his latest research on happiness and well-being might take into account what Obama had put his finger on: that work is identity, that men like to build, to have something to show for their sweat and toil.

“Infrastructure,” he blurted out. “Rebuilding infrastructure.”

Obama nodded and smiled, seeing it instantly. “Now we’re talking. . . . Okay, let’s think about how that would work as a real centerpiece.... Don’t even get me started about potholed highways and collapsing bridges,” Obama said....
Isn't it strange that collapsing bridges are exactly what Obama is back to talking about in September 2011?
And just like that, a policy to repair the nation’s infrastructure was born. The federal government, in partnership with the private sector, would call upon the underemployed men of America to rebuild the country, and in doing so restore their pride
Obama wanted to rebuild masculine pride!

But what happened? Why didn't the original stimulus, in early 2009, rebuild America and America's men? I seem to remember some pushback. There was this NYT op-ed in December 2008, by Linda Hirshman:
Mr. Obama compared his infrastructure plan to the Eisenhower-era construction of the Interstate System of highways. It brings back the Eisenhower era in a less appealing way as well: there are almost no women on this road to recovery....

The bulk of the stimulus program will provide jobs for men, because building projects generate jobs in construction, where women make up only 9 percent of the work force....

Fortunately, jobs for women can be created by concentrating on professions that build the most important infrastructure — human capital. In 2007, women were 83 percent of social workers, 94 percent of child care workers, 74 percent of education, training and library workers (including 98 percent of preschool and kindergarten teachers and 92 percent of teachers’ assistants)....
And then what happened? Did Obama ever openly express his enthusiasm for masculine jobs? The terminology became "shovel-ready jobs." He couldn't say "manly jobs" or "men's work." Not only did Obama's abandon his dream of lifting up men, we didn't even get the construction work done.

And now here he is, last week, posing by a bridge that's — what? — falling down and getting accused of using the bridge as a "prop."

Oh! The masculinity!

129 comments:

Big Mike said...

Trump also made some promises to the inner cities while campaigning for black votes. In the end it really earned him nothing in the way of votes, but I think in addition to infrastructure he should follow through on those promises because it will be good for those cities and good for the United States.

traditionalguy said...

Buy Caterpillar stock. And watch for the world recession disappear as the USA gets its mojo back. You will see it when world oil prices go up.

And add to that, Putin wants to join the Christian Anglosphere and stop the Jihadists (all of the Muslims) from their drive for world conquest and murder. That alliance is what Obama fought the hardest to prevent.

Sydney said...

We got a couple of bridges in our area.

Mick said...

PULEASE. Althouse still trying to make excuses for the Usurper, whom she helped elect. Give it up already, you already proved how women should not be allowed to vote.

PackerBronco said...

Obama was never a builder. He was a faculty lounge leader.

traditionalguy said...

The way to understand Obama is simple. He was always lying. His smile comes from knowing weak minded people are lulled into believing his BS.

Big Mike said...

You could stop right there. That's the answer. These people were lying to scare us out of voting for Trump.

Professor, it was a win-win for Wall Street. If they scared enough voters out of voting for Trump they would have someone openly for sale in the White House. If not, then probably enough stupid people would engage in panic-selling that the investing class would make millions.

And so they did.

Nonapod said...

Obviously in the short term, the market always prefers stability and dislikes uncertainty. A presidential election happened successfully without crisis (despite many liberals losing their minds due to the result). I wouldn't try to infer anything else beyond that at this point.

Gabriel said...

Whatever Mick lacks in birth certificate analysis he more than makes up for it in election predictions.

rhhardin said...

The economy is hobbled by Obama and eaarlier regulation.

Most businesses operate on the edge. Each regulation drives a large number bankrupt.

The flip side is that removing those regulations brings them back. Large numbers.

Big businesses like regulation. It keeps small competitors from succeeding.

Big Mike said...

@PackerBronco, he was never a leader, in the faculty lounge or anywhere else.

rhhardin said...

Obamacare is a huge regulatory cost.

Even perversely obviously. Don't grow to more than 50 employees, don't let people work more than 30 hours, or your costs skyrocket.

rhhardin said...

The earned income tax credit is a bad idea because it _increases_ the marginal tax rate on the poor, discouraging work.

A flat tax on all income is much less damaging. If you don't earn much, you don't pay much. That's all you need.

rehajm said...

Even more uncertain is the effect that Trump’s victory will have on the economy as a whole....

It's only uncertain if you don't have a clue about micro and macro..

But it’s too early to say how much of Trump’s agenda will be enacted.

It in NOT too early to say. Pretty much anything that can be enacted using reconciliation will be enacted...

For starters, here's about how much can be enacted on day one with out any permission from Democrats.

boycat said...

The stock market is primed to take off in a Trump presidency. Bigtime.

steve uhr said...

Bad dream last night -- Trump became president and all the dems were telling us to rally around and show him respect.

Quaestor said...

Quaestor wonders where America's Politico is hiding. Could it be he drank himself to death in one of those snazzy K Street clubs he frequents?

rhhardin said...

Leftists are always doing tax things that mathematically can't work.

Larry J said...

Why should anyone be surprised that this prediction was just as inaccurate as all the other ones?

Scott said...

On infrastructure: In New Jersey, we passed a referendum as to whether we should devote the entire 23 cent-per-gallon gas tax increase* to the transportation trust fund. Now we have an extra billion and a half for roads, and continue to have an unfunded state pension liability that will drive the state to bankruptcy.


*NJ had the lowest gas taxes in the nation; and even with a 23 cent hike, gas taxes are still lower than New York State.

TreeJoe said...

The IRS is overworked, understaffed, underresourced, politicized, and unable to perform their duties adequately - including providing refunds/processing returns for 6 million illegal immigrants who filed taxes erroneously or fraudulently.

Now is not the time to give them added complexity.

MayBee said...

Obama is so petty. Not letting photographers take pictures of his meeting with Trump. What a coward he is sometimes.

traditionalguy said...

Fake Climate graft and coal power destruction by EPA fiat was the biggest drain of them all. And it was always a complete hoax without a speck of realty in any part of the False Religion.

So we rightfully celebrate the only full fledged Climate Warming Denier raised up to authority over any nation on this earth.

The Secret Service needs more agents.

Ron Nelson said...

Professor Althouse, how did Obama "get played"? I read through your commentary a few times and I simply miss how Obama got played rather than the American taxpayer. It seems that Obama was looking for a meme. Just like when the Stimulus bill was passed he equated handing money out like lottery winnings had the same economic benefit as money earned in productive effort.

buwaya puti said...

He was lying from the beginning.
The entirety of his economic policy was to reward his supporters. The stimulus went to political organizations and to support government employment.

Also, I am convinced there is an inherent political bias in industries, in lines of work. Anything concerned with the concrete, the physical, the material is inherently conservative. This is why I think California has worked so hard to drive out industry.

Dust Bunny Queen said...

Rebuilding infrastructure....or any building of anything, is done best by the private sector. Getting incompetent and corrupt government bureaucrats out of the picture will be the first best thing that Trump could do.

Just like the ice skating rink in New York that the city was wasting huge amounts of money on...when they turned it over to a private entity, one that has to be cognizant of expenses and profits, Trump got it done before schedule and under budget.

Getting rid of the onerous and ridiculous EPA rules will also go a long way to speeding up project completions. Instead of taking years upon years for study after study....the process can be truncated. I'm not advocating getting rid of ALL regulations, but come on! let's be realistic. It shouldn't take 10 years to get approval to build a building, repair a road.

Getting rid of the Unions strangle hold on construction would also go a long long way to revitalizing the inner cities and more importantly allow small businesses and their employees to benefit as well.

Trump can do this. It just requires a will of steel. I think he has shown us this.

Luke Lea said...

In the past Trump has proposed massive tax increases on the wealthy. Like the good old-fashioned Democrat he really is at heart, I predict he will do it again if massive deficits continue to run up the national debt. For instance, don't be surprised if he lifts the wage cap on Social Security and Medicare taxes or even removes the cap entirely and extends it to unearned income in addition to wages and salaries. Not only would that shore up Medicare and Social Security, two programs he has promised not to cut, but it might be enough to balance the budget all by itself.

Of course I'm just dreaming. He would be clobbered in the press. Not.

Clyde said...

A lot of Wall Street had to be unhappy that all of that money they spent trying to buy influence with the Clintons was totally wasted. They might as well have tied it up in a sack, weighted it with a rock and dropped it into the middle of ocean. However, the good news is that a Trump administration will hopefully follow through on his promise to cut government regulation. That alone should make the productive people of this nation (and those who trade stocks in those companies) happy.

Karen said...

It seems naive in the extreme to actually believe that Obama wanted to rebuild infrastructure. The first trillion dollar omnibus that Congress gave him to do just that was instead spent on advocacy groups that support the leftist agenda. The money was just frittered away and nothing got built. He played that game. No one played him. He's a very smart guy.

coupe said...

By the way, the new web site to follow your new leader:

https://www.greatagain.gov/

Tune into twitter to catch the lamentations of the defeated.

clint said...

Obama didn't get *played* out of the shovel-read infrastructure jobs. He used the rhetoric about such jobs to get his trillion dollar handout to Democratic advocacy groups passed. And then he dropped the blue-collar white guys the second he didn't need their support anymore. And then their anger gave us Trump.

Barack Obama was not a victim in this. He was the culprit.

Pianoman said...

@shiloh hardest hit.

Wasn't he predicting market meltdown on Wednesday, in the wake of HRC's loss?

I guess it was all he had left.

rehajm said...

A lot of Wall Street had to be unhappy that all of that money they spent trying to buy influence with the Clintons was totally wasted.

What about all those foreigners expecting a return on their 'investment'? They must be steaming and looking for clawbacks from Hillary right about now...

Quaestor said...

Well said, Clint.

rcocean said...

The whole MSM campaign narrative was a bizzaro-world distortion of reality.

Trump is a moderate, NY business man. If anyone could be expected to be "good for Business" it was Trump. Instead, because of the liberal MSM and his comments about Wall Street excesses and bad trade deals, he was turned into some populist radical who was going to destroy the Stock market!

Alexander said...

Like Obama was every really behind any plan that would have restored pride and prosperity to the white working class.

It was explicitly because it would help too many white men that everything was shelved in favor of money handouts to banks, scams pretending to produce green energy, and service (female) industry support.

It's going away lads. We're going to have the best roads, the best bridges, and the best airports. Those things, we're NOT going to make Mexico pay for, by the way. Just the wall.

Alexander said...

rcocean,

Good for business no longer means, "will this result in more goods and services available and provided."

It means, "will this result in more opportunities for graft, and funnel more power and money through the right people."

Trump will NOT be good for newspeak business.

Amexpat said...

There were plenty of dubious scare tactics on both side, but this wasn't an example. Before the election, the market was moving up and done in reaction to expected results. There was a rally a couple of days before when it looked like HRC was going to win. When it was obvious that Trump was going to win, the DOW futures were down 1000 points at one time. The market opened down and then rallied after Trump's victory. Many reasons why, but making a political point is not one of them.

Wilbur said...

I get very suspicious whenever I hear a politician tout the need for more spending for "infrastructure". Too little money goes to repair existing roads and bridges and too much is spent on brand new roads and crap like high speed rail.

If $$$ is appropriated for this purpose, it must be tightly tied to its intended repair use. Local and state pols love shiny new stuff that voters can see. And we already know how Obama lied (or misspoke from ignorance, if you will) about "shovel-ready jobs".

The Drill SGT said...

10 Things that POTUS Trump can do to stimulate the economy.

1. Kill the EPA's impending new regs on Clean power. That alone will redirect $500 Billion into useful growth by preventing the early retirement of useful fossil power

2. Rework the tax code

3. kill the ethanol subsidy and the other renewable power subsidies. If new energy can compete, let it.

4. shorten the regulatory approval process for infrastructure. This lowers costs in many ways.

5. kill obamacare

6. invest in pipelines, powerlines, and roads

7. sell off some federal lands and make them productive

8. restart logging on federal lands

9. open up off shore drilling

10. kill the CFPB, Tune up SOX

NOTE: Only #6 spends money. the rest stimulate and save tax dollars at the same time

Lyle said...

I was just listening to the Diane Rehm's replay on XM, and they had foreign policy journalists on lying about how Trump is being cheered by our enemies and threatens fights with allies like Japan and Mexico. What nonsense. Why have political journalists on to talk about this stuff?

Big Mike said...

@clint, I agree whole-heartedly. With Obama it's very important to ignore what he says (and especially stories planted by his flunkies in an unusually gullible media about what they said he said) and focus on what he does.

tcrosse said...

In Donald Trump's Amerika we will all be required to change our underpants every 25 minutes. To make it easier to check, we will be required to wear our underpants outside our clothes. I read it somewhere....

OldManRick said...

I have trouble believing that the Obama stimulus was anything more than payouts to cronies when Michael Mann of the famous (or infamous) hockey stick got $2.4M. See http://www.wsj.com/articles/SB10001424052748704541004575010931344004278

Gretchen said...

I know a few college kids who seemed to have it all together but are falling apart in college. They are all SJWs and I have to wonder if for bright kids who take all this stuff seriously the horror of Trump isn't overwhelming.

They have been lead to believe he is going to round up Muslims and Hispanics, he's going to make rape legal (actual heard a variation of this), and these female students who have been lead to believe they have a 1 in 5 chance of getting raped (or being accused of rape for a consensual encounter if they are male) in college that is terrifying. They have been told Trump hates black people, will ruin the economy and they attend classes that no longer teach a balanced perspective on anything. History only talks about the oppression, hatred and slave ownership of America, literature no longer talks of heroic human struggles, romance love and hopefulness but is a constant tirade the worst impulses. Halloween is now an occasion that can involve the campus police, not due to tricks gone bad, but because an offensive costume was worn. In order to be a good person, students not only need to make sure they wear a costume that offends no one, they must signal they are virtuous by judging every costume on SJW standards to make sure they are not laughing at a funny costume that turns out to be politically incorrect, and they in turn are worse than Nazis.

Women are pressured to fight to ensure transgendered women (with penises) are allowed to use the women's locker room, which should not make them uncomfortable because if they feel even the slightest bit of discomfort they are terrible anti-trans bigots. They are also told that the planet will uninhabitable by the time they graduate, because Trump and his minions are in the pocket of Big Oil.

Did I mention they will be $200K in debt when they graduate? No wonder these kids are having mental breakdowns.

Ann Althouse said...

"Professor Althouse, how did Obama "get played"? I read through your commentary a few times and I simply miss how Obama got played rather than the American taxpayer. It seems that Obama was looking for a meme. Just like when the Stimulus bill was passed he equated handing money out like lottery winnings had the same economic benefit as money earned in productive effort."

He wanted to make manly construction jobs a signature achievement. He got played out of that. He wanted to put his brand on boosting masculine pride.

Achilles said...

I am one of the earliest Trump supporters. I am very happy he won. I don't have to resist the usurpation of my country by corrupt criminals.

But there is optimism here people need to temper. Remember what has been going on the last 8 years. We have printed/borrowed 15% of our GDP. We have had less than 2% growth. Interest rates have been held artificially low to help obama and they necessarily will be raised. The stock market has doubled on 2% growth. At least 10 million people will be forcibly dislocated from their jobs by distuptive technology.

Most importantly get ready for the economy to suck every day. Unexpectedly will disappear from daily economic reports. The media is going to trash the economy every day and though they destroyed their credibility it will still have an affect.

We are still in a fight with evil people. They are going to pull the plug on the stock market. There will be a correction for the last 8 years. World debt is 225% of world GDP. The correction is baked in and they will blame it on Trump.

dreams said...

"But what happened? Why didn't the original stimulus, in early 2009, rebuild America and America's men? I seem to remember some pushback. There was this NYT op-ed in December 2008, by Linda Hirshman:
Mr. Obama compared his infrastructure plan to the Eisenhower-era construction of the Interstate System of highways. It brings back the Eisenhower era in a less appealing way as well: there are almost no women on this road to recovery...."

All the tarp money went to keep public employees from being laid off including a bunch of teachers while the private sector was laying off their employees and getting more efficient and there weren't any shovel ready projects so Obama and the crooked Dems just blew the money.

Also Obamacare, it was all about Obamacare. We sure do have short memories.

bagoh20 said...

Let me break it down for you. As with many things,

experts are not.

Matthew Sablan said...

Because the experts are not very good at predicting Trump related things.

dreams said...


"He wanted to make manly construction jobs a signature achievement. He got played out of that. He wanted to put his brand on boosting masculine pride."

There weren't any shovel ready projects and Obama even made jokes later about his being so wrong about shovel ready projects.

Freder Frederson said...

The man is a builder, and I think he can get these things built.

He is also proposing massive tax cuts and increased military spending. How is he going to pay for all that. Even if we somehow managed to get to 4% growth under Trump (which I will confidently predict ain't gonna happen), he will blow up the debt and the deficit. He also wants interest rates to increase, which will increase the cost of borrowing.

Achilles said...

For the next 4 years 300,000 jobs created every month will be low paying jobs and it will be below expectations.

And we will be hearing about the popular vote that had at least 2 million illegal voters pumping up Hillarys numbers.

Just because we won doesn't mean they will stop. The same cronies own the media today that owned it before.

Bob Boyd said...

"It is amazing what you can accomplish if you do not care who gets the credit." - Harry S Truman

Limited blogger said...

The stock market and the economy are going to roar. Bigly.

Quaestor said...

He also wants interest rates to increase, which will increase the cost of borrowing.

You obviously don't understand fiat currency theory.

Freder Frederson said...

9. open up off shore drilling

Recent leases have had no bidders. Producing more oil under current prices is just not feasible. While coal may be harmed by environmental regs, the decline in coal has much more to do with the cheap price of gas.

Roughcoat said...

Also, I am convinced there is an inherent political bias in industries, in lines of work. Anything concerned with the concrete, the physical, the material is inherently conservative.

This is an interesting theory. I'm not sure "bias" is the right word, but still: it is a theory that merits further thought, and development.

steve uhr said...

Now we enter the stage of the game where trump will try to do some of the same things Obama was vilified for doing. Obama could do no right. Trump can do no wrong. Even when it is the exact same thing.

n.n said...

Obama didn't get played. Everything he did was "shovel-ready" from the "affordable care tax" -- not affordable care -- to the saved and created wars around the world (from Baghdad to Tripoli to Kiev) to immigration "reform" to the progressive debt to renewable class diversity.

rehajm said...

How is he going to pay for all that.

Trump victory is already paying dividends: fiscal accountability has returned!!!

dreams said...

Most people I respect were calling for only about one or two day stock market crash and suggested it would be a good buying opportunity but we didn't even get that but the market had sold off nine straight trading days prior to the election which is when I suggested it would be a good time to buy if people had some money to invest.

Achilles said...

Blogger Freder Frederson said...

He is also proposing massive tax cuts and increased military spending. How is he going to pay for all that. Even if we somehow managed to get to 4% growth under Trump (which I will confidently predict ain't gonna happen), he will blow up the debt and the deficit. He also wants interest rates to increase, which will increase the cost of borrowing.

Get ready people. 4 years of the left suddenly caring about the deficit. They didn't care when obama didn't pay for anything but that will all change now. 4 years of 3 and 4% growth being not good enough. 4 years of reports on the economy being sluggish and only for the wealthy every time the stock market goes down.

People like Freder are absolutely dishonest and disingenuous and they control the media.

rhhardin said...

boosting masculine pride

Those are union jobs. Obama was after getting unions government money.

rhhardin said...

I saw a "Men Working" sign last summer, on a tree-trimming crew way up there in the branches.

Hagar said...

To Obama and his crowd (and to economists) "rebuilding infrastructure" are just words meaning we will print up some money and set it out on the stoop and something will happen. The nerds will take care of it, and "the economy" will pick up. They do not have a clue to how things actually work and especially not how to get something built.

bagoh20 said...

Obama's only experience managing anything before running for President was being put in charge of $387 million to improve education in Chicago schools. They spent the money alright - got that part down pat, but

"..., results suggest that among the schools it supported, the Challenge had little impact on school improvement and student outcomes, with no statistically significant differences between Annenberg and non-Annenberg schools in rates of achievement gain, classroom behavior, student self-efficacy, and social competence."

That's a lot of money that could have gone to school vouchers.

So why is it surprising that he blew a bunch of money with no success when he had the opportunity. It's kind of his thing. Think of how many health insurance policies for the poor could have been subsidized with all the billions spent on Obamacare: websites, outreach, regulators, paperwork, databases, payoffs, etc., plus all the extra money spent by people on grossly increased premiums. If you added up all the costs, and compared the benefits, I don't know how you could even imagine a bigger failure in history of government work.

Achilles said...

Blogger steve uhr said...
Now we enter the stage of the game where trump will try to do some of the same things Obama was vilified for doing. Obama could do no right. Trump can do no wrong. Even when it is the exact same thing.

Hahahahahahahahaha

Birkel said...

Obama is loved. He told all the right lies and people swooned. Mainly women. And that was why Obama focused on women.

Payoffs for political supporters.

The Godfather said...

I knew Obama wasn't serious about fixing the economy when he announced in his first State of the Union Address that he was going to push "high-speed rail". High-speed rail isn't needed. If you build it, passengers won't ride it. It's only a way of throwing money at some favored politicians, labor unions, and environmental fanatics.

But this is a cautionary tale for Trump, too. Building infrastructure is great, but it costs money. We're already hugely in debt; should we borrow even more to build roads and bridges? Or should we fix the economy, so it generates more wages and more taxes, cut expenditures that are less vital than infrastructure, and then start work on the roads and bridges?

The Godfather said...

I knew Obama wasn't serious about fixing the economy when he announced in his first State of the Union Address that he was going to push "high-speed rail". High-speed rail isn't needed. If you build it, passengers won't ride it. It's only a way of throwing money at some favored politicians, labor unions, and environmental fanatics.

But this is a cautionary tale for Trump, too. Building infrastructure is great, but it costs money. We're already hugely in debt; should we borrow even more to build roads and bridges? Or should we fix the economy, so it generates more wages and more taxes, cut expenditures that are less vital than infrastructure, and then start work on the roads and bridges?

rhhardin said...

Althouse would like the chapter "Call It a Day for Democracy" in Derrida's _The Other Heading_.

Probably in the university library. Maybe out of print, I don't know.

It's on the differences between public opinion and a vote, and what journalism is.

Deeply etymological thought.

dreams said...

"steve uhr

Now we enter the stage of the game where trump will try to do some of the same things Obama was vilified for doing. Obama could do no right. Trump can do no wrong. Even when it is the exact same thing."

steve uhr, you err in your assessment and your prediction.

Todd said...

Obama wanted to build the infrastructure. He cared about putting people to work, and he got played out of it.

Really? That is how you saw it? My take was that he did exactly what he wanted to and when the money started rolling, it went to his picks, not to boring bridges and highways. He didn't get played, he played everyone else (just like some of us said) and the money was then just gone. Cronies got wealthier and no jobs for men materialized.

Matthew Sablan said...

Trump won the election on the cheap; I think he gets a bit of the benefit of the doubt on how to handle budgets.

Rusty said...

der Frederson said...
The man is a builder, and I think he can get these things built.

He is also proposing massive tax cuts and increased military spending. How is he going to pay for all that. Even if we somehow managed to get to 4% growth under Trump (which I will confidently predict ain't gonna happen), he will blow up the debt and the deficit. He also wants interest rates to increase, which will increase the cost of borrowing.

Maybe he'll just fire a bunch of you guys. Problem solved. 4% is eminently do-able if 30% of federal workers are on the street.

Fabi said...

Obama and 'masculine' should never be used in the same sentence.

Hagar said...

Last I heard of it, which must have been in 2022 or so, about halfway into Obama's reign, only half of the money appropriated by the Bush administration for re-building New Orleans had been spent.
Likewise with Obama's near trillion dollar "pump priming." It has just slowly been running out into the sands with little or nothing actually getting built. These guys just have no idea of how to actually accomplish anything.

Hagar said...

2012, not 2022!

Gahrie said...

he will blow up the debt and the deficit.

Well considering that the last two presidents have each doubled the debt (Bush 43 $5 trillion to $10 Trillion, Obama $10 trillion to $20 trillion) why is that suddenly a problem?

I know why I think it is a problem, I'm just curious as to why you do.

Jack Wayne said...

The way Obama got played is simple: he let his party talk him into union wages and full union employment for the shovel-ready jobs. That brought the whole thing to a crashing halt. It took about 4 years to get the plans in place and the money lined up. The result is that shovel-ready jobs started coming online in 2013 and later. But the scope was cut considerably because of the union rules. Plus, the government only builds gold-plated infrastructure constricting the output even more. And then there's the economic downside that all those jobs are being paid for by the government. In the end, Obama caved and handed out welfare by the truckload. He's a man that ALWAYS takes the easy road.

William said...

Infrastructure is a vague amorphous term.. A lot of construction projects are ill advised and grandiose. Not every construction project is the Hoover dam. The two trillion dollar Obama library and amusement park seems to me to be a foolish waste of money and resources, but it will provide many useful jobs in Chicago. Many people from the Clinton Foundation have already signed on to supervise diversity hires and drug counseling services........ I live in NYC. The fabled, almost mythological 2nd Ave Subway is nearing completion. It was first shovel ready ninety years ago. It should be finished sometime in the new year. The cost overruns are in the billions. The subway will serve exclusively the upper east side of Manhattan. This is the neighborhood in which I live so I'm not complaining. It will definitely increase the value of my coop. Still, I can't help wondering where all those billions went and why this most expensive construction project serves mostly to increase the value of one of NYC's most expensive neighborhoods.

robother said...

Have any of these people ever driven by a large construction project (new hotel, Highway overpass, etc.) and actually looked? Compared to the 60s, when I was last involved in construction labor, even the largest projects have only a handful of guys in hardhats. Cranes, giant Cats and Deeres operated by a few people. There's almost more people involved in traffic control than actual project work. "Shovel ready jobs" is literally a phrase from the 1930s workplace.

Hagar said...

As for Eisenhower and the Interstate system, that came from one of his missions in the 1930s which was to lead an army detachment from the East to California and turned out to be an epic trek of adventures comparable to the Mormon Battallion 90 years earlier.
Eisenhower wanted those roads built one way or another. It was not about "the economy."

Todd said...

Freder Frederson said...
The man is a builder, and I think he can get these things built.

He is also proposing massive tax cuts and increased military spending. How is he going to pay for all that. Even if we somehow managed to get to 4% growth under Trump (which I will confidently predict ain't gonna happen), he will blow up the debt and the deficit. He also wants interest rates to increase, which will increase the cost of borrowing.

11/10/16, 10:50 AM


You are so RIGHT! Let us just keep doing the same stupid crap that got us into this instead of doing something else. If the last 8 years got us here, all we have to do to fix it is do the same thing, just more of it and faster, right? Don't remember hearing you crying about the deficient a week ago, why is that? Is it so much bigger now?

bgates said...

He wanted

No, it was reported that he said that he wanted.

How is he going to pay for all that.

Throwing Muslim women over the border wall with a giant catapult and putting it all on pay-per-view, is what I heard. What's it to you?

Hagar said...

And I think that today, 60 years later, it will still take an estimated 44 million dollars to complete the system - though of course, these are just Obama dollars, not Eisenhower solid silver ones.

Hagar said...

Geeze!!! 44 billion dollars!

Rick said...

Ann Althouse said...
He wanted to make manly construction jobs a signature achievement. He got played out of that. He wanted to put his brand on boosting masculine pride.


You're assuming the conclusion. What evidence exists that he didn't simply want a stimulus and believed "manly" infrastructure was the best selling point, always aware the final funding would be largely elsewhere?

You seem to think that his selling statements are conclusive, but they equally support the alternate position. This is true for any politician but for those who require evidence Obama has proven he will mislead the public about his programs if necessary to pass them (Obamacare will save 2,500 / year / "typical" family, if you like your doctor you can keep your doctor). Other evidence is exactly how did he get played? He's the new President and Hero to the Party, but he can't get the Party to do what he wants? This seems unlikely.

I don't see how any selling statement can be concluded as clearly true rather than political marketing.

Freder Frederson said...

Get ready people. 4 years of the left suddenly caring about the deficit.

The reason I pointed this out is that I thought it was you guys who were concerned about the deficit. Apparently not.

protestmanager said...

The big questions are:

1: Does Trump want to build infrastructure, or graft
2: How much graft will congress demand in order to build any infrastructure

The Obama / Pelosi / Reid Porkulus was worthless for the economy because it was about graft for the Left, not actually helping America.

Actual construction jobs building and repairing valuable and productive things would be a win for the US.

Getting that through Congress will be a challenge.

rehajm said...

Just watching press coverage of Trump's visit to The White House. Rumor has it Trump's first request was to see where they keep the pen to sign executive orders.

HoodlumDoodlum said...

I stayed up past 4am watching returns (and posting/reading posts here at Althouse) and the news (ABC) said over and over again "futures markets way down, dropping so much the circuit breakers are tripping, oh no, oh no!." NPR mentioned several times that Dow futures were down more than 500 points Wed. morning. That was the story...

But then when US markets rebounded sharply and ended the day UP 250 points, almost 1.5% in a single day...silence. No story, no mentions, no big deal.

Almost like it's some sort of bias at work, huh?

Seeing Red said...

Bought 2 new stocks, now have to investigate mutual funds.

Drill, baby drill, build baby build!


We need to bury our grid, that's #1.

JAORE said...

I was with the Federal Highway Administration, Alabama Division, during that first stimulus. We got a slug of money to spend. I held meeting with two of the larges Regional Planning Commissions,Cities and the State DOT. I went over their "wish list" for the stimulus. As always the wishes were far larger than the funds available.. Then I explained all the regulatory delays with certain of their project. I also highlighted which projects could be advanced right away. In fact I used my authority to environmentally clear several on the spot. Others I explained potential short cuts through the Federal maze and probable time lines. I was clear that they could,despite my advice select any eligible projects they wanted.

My boss was impressed and described my efforts up the line. You'd think I might have gotten an atta-boy. Instead word came down that I was to quit interfering with the local project selections.

In the two areas I met with, they largely followed my advice. Projects were built rather quickly (as these things go). There were still stimulus projects undergoing environmental review in other areas of the State when I retired in 2000.

Seeing Red said...

Back to the 80s we go, Achilles!


How fitting, chair rails, wallpaper and grey are already in!

Rick said...

Freder Frederson said...
The reason I pointed this out is that I thought it was you guys who were concerned about the deficit. Apparently not.


See, how it works is, we don't whine until we see the bill. Then we don't look like idiots for claiming Trump's going to re-segregate the races.

holdfast said...

I have no problem with doing useful infrastructure upgrades and improvements, but we have to acknowledge that modern construction techniques are much more mechanized - and as such need a lot less grunt labor.

I am very much in favor of permitting big projects like Keystone XL and other big private projects. With oil and gas prices currently low, there won't be a lot of drilling and other investment at the well-head for the immediate future, so it's a great time to do the bigger projects like continental pipelines, export terminal construction and expansion, and refinery upgrades. These sorts of projects rely on a lot of the same skilled workers - pipe-fitters, crane-operators, etc. - as do smaller well-head projects and a lot of these folks are idled right now - so they are available cheap. Smart companies with good liquidity can do the big stuff now on the cheap and when the price of energy takes off again, as it will eventually, they will look like geniuses. All the Feds need to do is issue the permits and get out of the way.

Hagar said...

All the Feds need to do is issue the permits and get out of the way.

They are not getting out of the way unless somebody takes them out of the way.

holdfast said...

They are not getting out of the way unless somebody takes them out of the way.

I agree. Big league.

eric said...

I'd like to make a prediction of which I am confident. Sadly, few will see it or even know it was made.

The markets will go down, big, and soon. All the right people expected a Hillary win, so they weren't ready for a sell off. It's not easy positioning for a sell off when you manage billions and billions. But the sell off is coming.

Just keep this addage in mind. Markets must be kept propt up during a democrat administration and the chickens come home to roost during a Republican administration.

BrianE said...

What's good for main st. isn't necessarily good for wall st.

There is only a casual correlation between GDP growth and the stock market, in fact there is evidence that the correlation is inverse.

So, after 8 years using wall st. as a cheap proxy for the economy, what might happen if we concentrate on the issues of real job growth/stemming the exporting of jobs/free trade vs. fair trade-- however you want to characterize it, is that the stock market will probably drop in the short term and recover over time.

But first he has to be inaugurated.

buwaya said...

"Kill the EPA's impending new regs on Clean power. That alone will redirect $500 Billion into useful growth by preventing the early retirement of useful fossil power"

Ditto x 100

Achilles said...

Blogger eric said...
I'd like to make a prediction of which I am confident. Sadly, few will see it or even know it was made.

The markets will go down, big, and soon. All the right people expected a Hillary win, so they weren't ready for a sell off. It's not easy positioning for a sell off when you manage billions and billions. But the sell off is coming.

Just keep this addage in mind. Markets must be kept propt up during a democrat administration and the chickens come home to roost during a Republican administration.


Exactly. And trump will get the blame. My post above details the fundamentals behind the correction. The press will have an orgy.

But most of the people out here won't even notice though.

320Busdriver said...

Confidence Men was a great read. What I got out of it was how Obama whiffed on healthcare reform. He did not take the advice of leaders in healthcare like Wennberg of Dartmouth and instead we got sausage from the likes of Zeke Emmanuel and J Gruber.
How'd that work out?

That and how his choices of R Emmanuel and L Summers made it impossible for him to find his feet as leader of the free world until he got rid of them after 2 years.

I don't see Trump making big mistakes in choosing his inner circle, but we will see.

Bad Lieutenant said...

Even if we somehow managed to get to 4% growth under Trump (which I will confidently predict ain't gonna happen)

How confident were you that Hillary Clinton and the D Machine would curbstomp Donald Trump in this election?

320Busdriver said...

To be sure, the cbo projections are for the deficits to rise substantially over the next 20 years primarily due to rising healthcare costs and explosion of 65+ population.

If Trump gets the economy heated up and can make progress on SS and Medicare, yes those NEED to be reformed and neither you nor I are going to be happy about whats required, we will be in much better shape fiscally.

320Busdriver said...

Eric said
....... "All the *right*people expected a Hillary win, "<----irony

CWJ said...

eric and Achilles,

Not just a sell-off. Now that Hillary lost and once Obama is out of office, I fear Yellen may finally raise the fed rate knowing that the R's will take the blame should the economy tank.

Michael said...

cwj

Yellen will raise rates in Dec. Higher rates will not make the "economy tank", on the contrary higher rates will give the Fed room to move in the event the economy goes into recession. That is what she has been trying to get these last 18 months: headroom in case of disaster.

At present capital is leaving the fixed income market driving up rates as a result and moving into equities. The ten year crossed 212 midday.

Equities are getting the attention because capital gains rates and corporate rates will be lowered come spring time.

Not sure where you are getting your economic advice but I would make a change.

dreams said...
This comment has been removed by the author.
dreams said...
This comment has been removed by the author.
dreams said...

And this on 11/2/16

dreams said...
Now would be a good time to buy stocks if you have some money to invest. Buyer beware though.

11/2/16, 11:16 AM

dreams said...

Also this 11/4/16

Blogger dreams said...
Well, there is this.

"Fast forward to today when as noted earlier, the S&P500 has declined nine consecutive trading days, the first time it has done so since 1980. But more importantly, this is how the market has performed in the past 3 months:

The chart above, which shows that the S&P has fallen some 4.5% over the critical three month period, suggests that based on this indicator, Trump has a roughly 86% chance of winning the presidential election. Alternatively, if only looking at the eight distinct cases in which the market declined in the 3 months heading into the election, there was just one occasion in which the pattern did not hold and the incumbent party was booted out on 7 of those occasions, boosting Trump's implied odds of success even higher, to 87.5%."

http://www.zerohedge.com/news/2016-11-04/market-indicator-gives-trump-86-chance-winning-election

11/4/16, 9:03 PM

Freder Frederson said...

How confident were you that Hillary Clinton and the D Machine would curbstomp Donald Trump in this election?

Not very confident at all. As I told my mother (who lives in England), if the Brits were stupid enough to vote to leave the EU, the Americans might be stupid enough to elect Trump.

jr565 said...

I don't know if infrastructure is necessarily the best way to do a stimulus. However, when obama promised the same thing he ended up with no shovel ready jobs and a sop to liberal interest groups. So he didn't even really address infrastructure OR STIMULUS. It seems like trump is.
Granted, the proof is in the pudding, but if he knows anything it's how to build stuff. With obama the economy was an afterthought (growing liberalism was his primary focus) with trump it seems like it's his only focus. (Though some free traders might take issue with his protectionism) I don't think he's that ideological at all. Judges he can take or leave. If repubs are his congress and they want judges he'll give them whatever judges they want. But the economy and infrastructure. That's his baby.

jr565 said...

"Not very confident at all. As I told my mother (who lives in England), if the Brits were stupid enough to vote to leave the EU, the Americans might be stupid enough to elect Trump."
Maybe the U.K. Wasn't stupid for doing brexit at all. Especially now that trump won. England and the US are about to get along like peanut butter and jelly.

mockturtle said...

It's Europe that is stupid, not the UK or the US.

buwaya said...

"Maybe the U.K. Wasn't stupid for doing brexit at all."

Not so far at any rate. FTSE and other London Indexes are up nicely -

http://www.londonstockexchange.com/exchange/prices-and-markets/stocks/indices/summary/summary-indices.html?index=UKX

No effect on unemployment - still at full employment more or less - Note the British formula for unemployment rate calculation is far more valid than the US method.

http://www.bbc.com/news/business-37701672

Otherwise looking good -

http://www.focus-economics.com/countries/united-kingdom

Freder Frederson said...

Not so far at any rate. FTSE and other London Indexes are up nicely -

The process hasn't even started yet. In fact one of the most egregious aspects of Brexit is that the main proponents of it (Farage and Johnson) not only didn't have a clue what the consequences of leaving were, but quit as soon as they won. "Let someone else worry about the mess we have created."

Big Mike said...

The process hasn't even started yet. In fact one of the most egregious aspects of Brexit is that the main proponents of it (Farage and Johnson) not only didn't have a clue what the consequences of leaving were ...

Perhaps not, but they understood the consequences of staying very well indeed.

buwaya said...

"The process hasn't even started yet."

But the markets are already pricing in the consequences of the process as well as the uncertainties. They may be wrong of course.

Nancy Reyes said...

We run a business here in the Philippines, and you know, not being publicized are the Asian business news articles, including from China, figure that since he is a businessman they can work with Trump because he is pragmatic.

CWJ said...

Michael,

Thank you sincerely for your input. I hope you're right that raising the fed rate proves beneficial. However, I didn't appreciate the semi snark of your last sentence. That you could have kept to yourself.

retail lawyer said...

Obama got played by whom? The system, man? He got played by his own stupidity and ignorance. He said at first he knew there were "shovel ready" projects in all 50 states. At the end, he chuckled that there were actually no shovel ready projects. Funny. Why weren't there? Because they take environmental impact statements, review, and then lawsuits. They are too slow to start for a stimulus. Why did he not know this, why did all the brainpower in the White House not know this? How could a Harvard trained lawyer not know about the lawsuits? How could a "Student of History" not know the story of the Alyeska pipeline - where an act of Congress of was needed to halt the lawsuits. He got played by not knowing how the world works. And he doesn't give a shit about blue collar jobs - example: Keystone XL Pipeline.

Rusty said...

Blogger Freder Frederson said...
How confident were you that Hillary Clinton and the D Machine would curbstomp Donald Trump in this election?

"Not very confident at all. As I told my mother (who lives in England), if the Brits were stupid enough to vote to leave the EU, the Americans might be stupid enough to elect Trump."


Here's a thought. Maybe it's you what is stupid. Examine that and get back to us.

Michael McClain said...

The words "Obama and Manliness" are not words I would associate with each other.

Gahrie said...

A flat tax on all income is much less damaging.

Yes..but it is less damaging to everyone, including the rich, so we can't have that. The purpose of the IRS and the Income Tax is no longer the funding of government. Now its primary purpose is the redistribution of wealth and harassing of thought criminals.

it _increases_ the marginal tax rate on the poor, discouraging work.

Yes. but the problem at its base is that the Left sees this as a feature, not a bug.

The second thing Trump should do after taking the oath is sign an executive order mandating that welfare and the tax code be changed to reward two parent families instead of punishing them.

Gahrie said...

The first thing is sign an executive order rescinding all of Obama's executive orders.