Saturday, January 27, 2018
A chilly reception
If you are like me, listening to Trump is the equivalent of having someone run his nails across an old chalkboard. Apparently that was the case for many who were forced to listen to him at Davos as he made his pitch to the world. As a journalist, you have to cover him no matter how painful it is.
Trump wasted no time bashing Clinton, claiming if she had been elected the stock markets would have crashed. Of course, we have no way of knowing, but most likely they would have still reached record heights, as Trump inherited an economy on the rise with the stock market already at a record high. Not that the Dow is the best indicator of an economic recovery, as conservative pundits told us throughout the Obama administration. But now that Trump is President the Dow is once again regarded as the top economic indicator. Just listen to Richard Quest crow about the stock markets. In a few years we can expect Quest to be filling Lou Dobbs seat at Fox.
A lot of persons are surprised the stock markets have been doing so well, as the economy doesn't seem to be supporting such high expectations. Fourth quarter reports show that the economy failed to reach Trump's target of 3.2% growth. Yet, the stock markets just keep rising. It seems a lot of persons are betting on these tax cuts and the deregulation policies coming out of Washington to usher in another highly speculative environment like we had in the middle years of Bush. However, major retailers continue to shut down stores and lay off employees.
Part of it is that the internet has become the chief hub of retail sales, but it also appears that big business remains cautious. After all, the last time we saw stocks soar like this we ended up with the worst banking crisis since the Great Depression. What goes up, eventually comes crashing down, as we are currently seeing with crypto-currency.
Trump also has a way of hitting the wave late. This is the same guy who decided to open a mortgage company in 2006, proclaiming that the real estate market is going to remain strong for a long time to come. Real estate was already beginning to slump with foreclosures on the rise that year, and it all came crashing down two years later. Little wonder the folks at Davos weren't overly impressed with his sales pitch.
Of course, that doesn't stop others from blowing Donald's trumpet. Ed Rogers thought the Big T was in command of Davos. Allana Petroff went even further to proclaim Davos loves the Trump tax cuts. Seems like Trump brought his own cheering section to counteract what he called the fake news.
Many were wondering what he was even doing there since so many of his statements run counter to the prevailing wisdom of Davos. Lithuania's president, Dalia Grybauskaitė tried to explain it in an interview with CNBC, saying that she is more concerned with America's actions than she is Trump's tweets, and from what she sees America still plays a strong military and economic role in Europe.
Macron is credited for having convinced Trump to come to Davos. On Amanpour last night, Sylvie Kauffmann, the chief editor of Le Monde, and Richard Haass, President of the Council of Foreign Relations, tried to explain why Macron was cultivating this relationship with Trump. Their general impression was that Macron saw security as the main issue here and that it was in Europe's interest to retain America's involvement in the counter-terrorism effort, especially since France has proven weak in this regard. Haass was a little bit more circumspect than was Kauffmann.
Oddly enough, Trump talked little about security. He mostly crowed about the American economy, taking full credit for its robust growth. Meanwhile, Europe and the rest of the world is bracing for the eventual downturn, knowing full well the wave lasts only so long. Trump once again appears utterly oblivious to the warning signs. What, me worry?