The most remarkable aspect of today's fiscal situation is not the size of the deficit but its timing. Historically, governments ran massive deficits during wars, depressions, or major crises. Today, the U.S. is running crisis-level deficits during a period of low unemployment, record equity markets, and no obvious national emergency. As investors, the uncomfortable question is: if these are the numbers during relatively good times, what will the fiscal picture look like during the next recession?
High inflatiion contributed to Trumps win and rejection of the Democrats. High inflation was a catalyst for Milei's win in Argentina. Will we see America's version of Milei arise in the next inflation cycle?
The most remarkable aspect of today's fiscal situation is not the size of the deficit but its timing. Historically, governments ran massive deficits during wars, depressions, or major crises. Today, the U.S. is running crisis-level deficits during a period of low unemployment, record equity markets, and no obvious national emergency. As investors, the uncomfortable question is: if these are the numbers during relatively good times, what will the fiscal picture look like during the next recession?
High inflatiion contributed to Trumps win and rejection of the Democrats. High inflation was a catalyst for Milei's win in Argentina. Will we see America's version of Milei arise in the next inflation cycle?
I hope so.🤞
My hypothesis is that a poltical turnover happens before hyper inflation.
That treasury ain't gonna loot itself.
Government will continue to expand, in order to capture more surface area.
They will create problems, and never fully solve them, to guarantee continued expansion.
"The bureaucracy expands to meet the expanding needs of the bureaucracy."