Macro Musings with David Beckworth David Bahnsen on the Incoming Trump Administration and the Financialization of the US Economy
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Jan 13, 2025 David Bahnsen, a Wall Street veteran and managing director of The Bahnsen Group, discusses the challenges posed by the Trump administration's economic policies. He dives into shifts within the Republican Party, revealing a move from optimism to a zero-sum mentality. Bahnsen critiques financialization, highlighting its impact on debt and capital allocation. He also compares traditional financial practices with emerging trends, like cryptocurrencies, and discusses the implications for growth and investment in the U.S. economy.
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Shift in Republican Party
- The Republican party has shifted from a positive-sum view of economics to a zero-sum view.
- This shift is driven by cultural anxieties, not economic arguments.
Cultural and Economic Shifts
- Globalization and cultural shifts like declining family values coincided, making it hard to determine causation for economic changes.
- The resentment towards non-assimilation among immigrants plays a significant role in current economic nationalism.
Entitlement Reform
- Entitlement reform is crucial for addressing the growing U.S. debt, but lacks political will.
- A future crisis may force politicians to address it, but it will involve painful choices.