Time and time again, I have complained on this blog that monetary and fiscal policy in this country are run like an infant in a candy store. We do whatever we want, spend whatever we want, throw a tantrum when we don’t get what we want, barely think about the decisions we make, and sacrifice and mortgage anything not nailed down to ensure that our quality of life as it exists today can continue for just one more day (speaking of which, have we audited Fort Knox yet?).
The nearsightedness of our policymaking in this country has been breathtaking.
At a very basic psychological level, people are opposed to change. It doesn’t matter whether it’s changing their cable provider or taking a detour in traffic. Extrapolating from this, people are really opposed to bigger, more consequential change.
Extrapolating from this, in the world of finance, I have consistently argued that market participants have been falsely conditioned by our monetary and fiscal policy in this country to always expect comfort and never expect interruptions from the market moving higher, or the quality of life status quo that we believe we are entitled to here in the United States to suffer.
This concept was the basis for my article explaining why I thought the next market crash would “break the brains” of market participants.
Now let’s zoom out and think about what President Trump is trying to accomplish with his tariff agenda. He is essentially saying that the status quo in the United States isn’t working and large changes need to be implemented—changes that will shock the global economy—to remedy the issue.
“Who is the status quo not working for?” some of you will ask me from your Porsche, driving down PCH, or from your desk overseeing your millions in the market.
If I had to venture a guess, I’d say it’s not working for people in towns like this: https://www.zerohedge.com/markets/your-discomfort-means-its-working
