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Complimenting last week show’s review of key economic events of 2016 and economic predictions for 2017, Rasmus provides a similar overview of key political events in 2016, their likely continuing impact into this year, and his political predictions for 2017.  Discussion includes the Trump victory in 2016 and the Democratic Party’s corresponding implosion at national, state and local levels. Rasmus predicts Trump quick legislative successes passing multi-trillion dollar corporate-investor tax cuts, gutting Obamacare, and repealing Dodd-Frank. On foreign policy, Jack predicts a deal with Russia over Syria, a continuing Trump ‘hard pivot’ to China already underway, a shift in US policy to allow Japan to remilitarize, and new US initiatives toward Taiwan, South Korea, Philippines and Australia as Trump attempts to ‘soften up’ China before engaging in bilateral renegotiation of the US-China relationship. Europe and Latin America key events in 2016 are reviewed, including Brexit, the Italian Referendum, and US-assisted legal coup d-etats in Argentina, Brazil, and efforts to destabilize Venezuela. Jack predicts elections in France, Netherlands, and Italy next year, and a renewed Greek debt crisis, will further destabilize Europe politically. Anti-US and Europe sentiment in Turkey could result in resumption of mass immigration. A National Front party victory in France will ensure the unraveling of Europe.  Jack further predicts Trump will go slow on NAFTA and TPP and shift to negotiating bilateral free trade deals, go slow on the Iran treaty and strike a ‘deal’ on east Europe (including Ukraine) with Russia.  Immigration policy will begin deporting millions, and a crackdown on civil liberties will result in more intense police action against protestors like Black Lives Matter and Standing Rock.  The feud between Trump and the US mainstream media (Times and Post) will continue, as the latter continue to build a case against Trump in the longer run.

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Dr. Jack Rasmus reviews the major economic events of 2016 and their likely continuing impact in the year ahead. Topics includes global trade stagnation, Federal Reserve rate hikes, global oil and commodity prices, property financial bubbles in China and capital flight and devaluation, Europe events involving the ECB, Italian and Europe banks, the UK economy post-Brexit, negative rates and non performing bank loans worldwide, the failure of Abenomics and bank of Japan’s QE, Latin American recessions, and the global corporate debt bubble. Also addressed are the US economy’s first quarter collapse and recovery, Fed rates, the shift to fiscal-infrastructure spending, the unwinding bond bubble and emerging stock bubble, health care and drug price inflation, and the rising US dollar and its impact on emerging markets. Jack offers his predictions for 2017 for the US economy, Europe, Japan, China, India, Latin America, emerging markets, and global commodity prices. (Next week show: review of major political events of 2016 and political predictions 2017).

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Dr. Rasmus reviews the US central bank’s decision this past week to raise rates, with three more hikes coming in 2017 (and more after in 2018-19). What’s really behind the Fed’s rate hikes’ decision? Why US economic elites have decided to shift policy to boost corporate and investor incomes more from fiscal policy in 2017 and after than from monetary policy over the past eight years, 2008-2016. What’s the impact on the US real economy from the shift and why it may not be as great as pundits predict.  Why rising rates for the rest of the rest of the US economy may destroy more jobs than infrastructure spending may generate, and the former happen faster than the latter. The outlook for US housing, autos, retail sales. Why real wages may fall.  How the euphoria of US stock markets conceals areas of real economic weakness that continue and may grow worse. Jack further reviews the effects of US Fed rate hikes on Europe, China and emerging market economies in Latin America and South Asia. How emerging markets are already now experiencing currency declines, capital outflows, financial instability, and will experience deeper recessions in the year ahead; why Europe will continued slow growth and stagnation and why China’s currency, the Yuan, will devalue beyond its trading band in coming months due to US rate hikes and dollar rise, and may intensify a US-China trade war.

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Jack focuses on the bubble growing in US stock markets, as money capital surges out of bonds and from Europe and emerging markets into US stocks. All US markets are at record levels, with the DOW having tripled since 2009 in value. Jack discusses the various causes and origins of the current bubble, including the global rotation from bonds, anticipated Trump infrastructure spending and massive corporate tax cuts, multi-industry deregulations coming, and devaluing foreign currencies. The recent Saez report on income inequality trends is reviewed in contrast. Why capitalists are switching from monetary, central bank policy now to fiscal policy to continue massive gains for the 1%. Other negative data for the US is reviewed, including productivity trends and public debt. The show concludes with a discussion of the recent Italian referendum and Italian banks and China’s pending currency devaluation and bank problems.

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Dr. Rasmus discusses key events of this past and coming week for the global economy, with a focus on US dollar, US short and long term interest rate hikes underway, and rising global oil prices. How the US dollar’s current rise is leading to a US and global bond market rout. Jack next discusses the origins of the bond-interest rate-oil price shifts, provoked by the Trump election but ultimately as caused by the unwinding of the Federal Reserve central bank bubble created since 2010. The congruent rise in US bond rates, dollar and global oil prices have set in motion an intensifying crisis in emerging market economies in the form of currency collapse, capital flight, and deeper recessions.  The dollar-bond rates-oil price shifts are also provoking instability in Europe, which, Jack predicts, will further intensify with Italian voter rejection of the Italian referendum vote December 4 and the Austrian national election vote that follows next week as well. Jack predicts a ‘No’ vote will mean a fall of the Italian government and will intensify that economy’s current Italian bank crisis in turn. Austria’s voting next week may also lead to Europe’s neo-Nazi Freedom Party’s control of government. Europe is on the edge of further economic and political instability.

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‘Trump’s ‘faux’ populism from the right is replacing Obama’s ‘faux’ populism from the left. Rasmus discusses how Trump will govern on economic issues (tax cuts, trade, business deregulation) no different than past mainstream establishment politicians. But will govern more repressively and radically on social issues, especially immigration, law and order, environment, health care privatization (ACA and Medicare), and Education privatization. How Trump’s trade policy is still free trade by another name and his Infrastructure proposals will not boost jobs as promised. Rasmus argues Trump represents an attempt to forge a ‘Neoliberalism 2.0’, i.e. more intense economic support for corporations-investors amidst more reactionary social measures—to appeal to the establishment as well as his base. Examples of Trump’s retreat already, revealed by interviews this past week. Rasmus also reviews Trump cabinet appointments to date as well as those to soon come as indicators of how he’ll govern from two directions to placate his base and the Republican-business elites. Jack concludes with a review of the various measures by which the Republican-Capitalist elites will continue to pressure Trump on main neoliberal policies (taxes, trade, deregulation) to ensure they continue: his business conflicts, his foundation, his tax returns, charges of nepotism and alleged violations of law by him and his cabinet representatives.  For Trump’s taming, watch especially appointments to Treasury, State, and Defense.  NEXT WEEK: the upcoming Italian vote and the political unraveling of Europe in 2017.

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Dr. Rasmus reviews the early effects of anticipated Trump policies, which are already significant: How the rising value of the US $dollar and long term interest rates, in expectation of Trump proposals for infrastructure fiscal spending, are already having major consequences for the US and global economies. Jack explains how the current rise in the dollar and long term rates ensure rising Fed short term rates, lower global oil prices, will result in a decline in US net exports and thus manufacturing production and jobs in the US. Why rising rates may negate Trump fiscal-infrastructure spending and job effects? How the rising dollar and US rates will have negative effects in Europe and Japan; will force China’s currency to devalue and accelerate a global currency war; and why Latin American other emerging markets economies destabilization will now intensify with more capital flight, currency collapse, inflation and recessions. Jack concludes with a discussion of Trump tax proposals to repatriate US multinational corporations’ $2.5 trillion offshore cash hoard by reducing their tax rate from 35% to 10%, explaining how that was tried with disastrous results already in 2005.  How Trump tax proposals are a continuation of established Republican neoliberal tax policy since Reagan and will mean another $4.5$ trillion in corporate tax reduction—following Obama’s $6.1 trillion corporate-investor cuts 2009-2013 and GW Bush’s $3.4 trillion handouts in 2001-04.

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Jack Rasmus discusses the economics behind why Trump won the election, and the economic legacies of the Obama regime behind why the white working class in the great lakes region—from Pennsylvania to Wisconsin—abandoned the Democrats and voted against the political elites and Clinton. Jack refers listeners to his shows earlier this year and predictions this would happen. (see also articles on his blog, jackrasmus.com). The no-college white working class vote was key, along with lower turnout for Clinton among Latinos, youth, and even African-Americans compared to 2008 and even 2012.  The show then reviews the areas of economic consequences expected from a Trump election, including: booming stock markets, rising bond interest rates, big corporate tax cuts coming quickly, Infrastructure spending, more price gouging by pharmaceutical companies and health insurers, the early dismantling of Obamacare and Dodd-Frank bank regulation acts, likely repeal of alternative energy credits, restoration of the Keystone pipeline project, gutting of the EPA’s funding, suspension of proposed industrial plant emissions, refusal to implement the Paris climate accords, boosted production of gas fracking, pipelines, and coal production, an immediate Federal Reserve rate hike in December and more likely in 2017 now, renewed attacks on social security, surging government deficits and debt, general deregulation of business and across the board repeal of Obama executive orders and passage of anti-Latino immigration legislation. The consequences for the global economy are also considered, with focus on emergency markets currency collapse, capital flight and further recessions, rising US dollar and falling oil prices, China’s currency devaluation, Europe and Japan QE policies, and likely measures addressing free trade including NAFTA, TPP, and TTIP.

 

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 Dr. Rasmus interviews Jill Stein, Green Party presidential candidate, discussing the real issues of the presidential election and her Party’s positions and solutions to the deepening political and economic crisis in the USA. Topics addressed include Green party proposals for tax reform. Reversing job destroying NAFTA, TPP, and free trade treaties. What to do about escalating healthcare costs and prescription drug price gouging. How to eliminate student debt and provide free public college education. Solutions to the growing retirement crisis and how to fund doubling of social security benefits and Medicare for All. Who Jill would appoint to the Supreme Court and reverse Citizens United. Her proposals for immigration reform. And Green party positions on preventing US military confrontation with Russia in Syria, East Europe and with China in the south China seas, toward which the US continues to drift.  How claims of ‘lesser evilism’ to vote Democrat to oppose Trump is a dead end and why voting a third party is the only way forward.  

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 Jack steps back and discusses the three presidential debates in a broader context, focusing on what the debates reveal about what is coming in 2017:  i.e. more aggressive US foreign policy action in Syria, against Russia, and in Southeast Asia (Philippines) soon after the election. More attacks on civil liberties by US political elites to silence alternative perspectives like Wikileaks and other media. More internecine conflict within the elite ranks of the two main political parties as they deal with rising popular rebellion against the ‘political class’, on both left and right. Republican and Democrat party elites ‘shoring up’ their rules to avoid Sanders-Trump type internal challenges re-occurring in 2020 and elite efforts to more tightly control their primary nomination processes and conventions. A growth of independent political parties as ‘rebellion against the political class’ moves outside the two party structure. Rising rent, healthcare, and inflation, and continuing wage stagnation for the bottom 90% of the workforce as US recession returns in late 2017. Growing disaffection of the millennials from the political system.  (Next week: interview of Jill Stein of the Green Party and Gary Johnson of Libertarians).

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