No. of Recommendations: 7
I'm trying to stay calm like you, Al, but it's hard.
You just need to remember that Trump wants to be thought well of. Not universally - he's perfectly happy for his enemies to hate him. But he generally wants to be flattered and admired and esteemed. So he wants the stock market to rise. He wants the economy to grow. He wants to preside over a successful economy. He was annoyed that he got no credit for the solid economy of his first term (pre-pandemic).
Hence, Scott Bessent. Trump's had all kinds of dodgy, kooky picks - but for Treasury, he went with the guy that Wall Street wanted. Because he doesn't want to roll the dice with the economy. Tariffs, sure - but I don't think anyone thinks that an across the board flat tariff is coming. Trump wants to cut deals. His theory of the case is the U.S. has been derelict in not throwing its weight around and using access to our markets as something that other countries have to pay for, rather than just get "for free" under some MFN regime.
So while there's no doubt that Trump will juice the gas on the economy using tax cuts, rather than spending increases, as his preferred fiscal juice, he's not going to try to wreck the economy the way he wants to wreck various parts of the federal bureaucracy. And he's going to go hard with tariffs, but ultimately strike bargains rather than scorched earth wars.
