Chad P. Bown: "Trump administration officials decided the best way to deal with recession risk which they of course aren’t personally worried about, was through a show of force on TV: Catherine Rampell: Move Over, Illuminati. The Conspiracy Against Trump’s Economy Is Massive: "Trump, aided by his economic brain trust of cranks and sycophants, believes any indicator showing the U.S. economy could be in trouble must be fabricated. It’s all part of an anti-Trump conspiracy, he rants, according to reports in The Post, the Associated Press and the New York Times. And move over, Illuminati, because this particular conspiracy is massive. It’s led by the Federal Reserve, Democrats and the media, of course, or so say Trump and his Fox News minions. But it also includes the entire U.S. bond market, which flashed a warning sign last week when the Treasury yield curve inverted (meaning long-term bonds had lower interest rates than short-term ones, which usually predates a downturn). Also colluding are the many farmers, retailers, manufacturers and economists who have been warning for more than a year that the burden of Trump’s tariffs is mainly borne by Americans, not China or other trading partners, and also that uncertainty over trade tensions can paralyze hiring, investment and purchasing decisions, which we need to keep the economy expanding.... The White House has reportedly declined to develop contingency plans for a downturn because it doesn’t want to validate this 'negative narrative'. This is, in a word, idiotic. As others have analogized, it’s like refusing to buy a fire extinguisher because you’re afraid of feeding a “negative narrative” that you might someday face a fire. Administration officials decided the best way to deal with recession risk, which they of course aren’t personally worried about, was through a show of force on TV.... Peter Navarro’s strategy was to deny that the data show Americans are paying higher prices on tariffed goods (though we are) and also that the yield curve had recently inverted (though it did).... Larry Kudlow... bizarrely pretended other troubling economic data (in this case, on consumer sentiment) didn’t exist.... It’s hard to imagine nervous Americans are really this credulous. Then again, perhaps we were never the intended audience for such performances. Sure, maybe White House aides are trying to fool the public into believing recession warning signs don’t exist. But maybe they’re actually just trying to fool their boss...


#noted #2019-10-04

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