from @jam_croissant :
If you didn’t already understand the current White House’s approach from their budget, Bessent is telling you 🔊 loud & clear, if you care to listen👂.
This is what he is saying in plain English:
- They want to slow demand in the real economy & hence slow inflation, by distributing less 💰 to people, via slowing wage growth and less social services to American’s in the median income on down?
How?
A/ Cut Government Employment
B/ Cut Medicare
C/ Cut Snap Food assistance and School Lunches
D/ Cut Low income Housing Assistance
Then, as these cuts take hold in the next 3-6 months…
- Meanwhile, they plan to in Equal amounts Increase supply side stimulus to get ‘private Industry moving,’ this will send money to the top 0.1% of the top wage earners. Not increasing inflation, while stimulating economic growth.
How?
A/ Massive Corporate Tax Cuts
B/ Gut the IRS and corporate financial oversight to reduce taxes further.
C/ Deregulate to allow corporations to operate untethered to increase profitability.
D/ Drill baby Drill
The demand side policies take effect quicker than the supply side, So… as cyclical deflation takes hold in 6 months or so… they plan to respond quickly with:
Loose Monetary Policy switching back from QT-> QE