{"id":30911,"date":"2018-02-12T13:11:24","date_gmt":"2018-02-12T18:11:24","guid":{"rendered":"http:\/\/olduvai.ca\/?p=30911"},"modified":"2018-02-12T13:11:24","modified_gmt":"2018-02-12T18:11:24","slug":"reckless-deficit-spending-by-congress-set-to-wreck-the-dollar","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=30911","title":{"rendered":"Reckless Deficit Spending by Congress Set to Wreck the Dollar"},"content":{"rendered":"<h3><a href=\"https:\/\/www.moneymetals.com\/news\/2018\/02\/12\/congress-deficit-spending-to-wreck-dollar-001416\">Reckless Deficit Spending by Congress Set to Wreck the Dollar<\/a><\/h3>\n<div class=\"content-body\">\n<p>U.S. equities got a free ride on the Trump train after his election, even as Federal Reserve officials hiked interest rates. That ride may have ended last week.<\/p>\n<p><img decoding=\"async\" class=\"img-reponsive content-img-right\" src=\"https:\/\/www.moneymetals.com\/uploads\/content\/hiked-rates.jpg\" alt=\"Hiked Rates\" \/><\/p>\n<p>If commentators are correct and the blame for recent selling in the stock market falls on the burgeoning fear of rising interest rates, it looks like Fed tightening is finally having the effect many predicted when the cycle began.<\/p>\n<p>Most currently expect the FOMC to continue with hikes at about the same pace set in 2017. They have gotten away with several hikes, but attempting several more will be harder for them.<\/p>\n<p>The question is whether the Fed\u2019s tolerance for pain is any higher under new chairman Jerome Powell. We\u2019d wager that it won\u2019t take much in the way of flagging stock prices and slowing growth to have them reversing course and punching the stimulus button.<\/p>\n<p>No one should bet that last week\u2019s rally in the dollar means the bottom is in. The next few years look downright terrifying for the greenback. Here are some factors to consider:<\/p>\n<ul>\n<li>Congressional Republicans embarrassed themselves last week by proving the lip service they pay toward fiscal conservatism is nothing but lies. The Republican leadership shepherded through $300 billion in additional spending. Furthermore, they once again completely suspended the limit on borrowing;<\/li>\n<li>The Treasury will be issuing staggering amounts of new debt to fund the Congressional spending spree. Last fall\u2019s tax cut may be good news for taxpayers, but it will also magnify federal deficits. Net new debt in 2018 is expected to be $1.3 trillion \u2013 the highest since 2010!<\/li>\n<li>President Trump will soon begin the push for a trillion-dollar infrastructure program. That will almost certainly be paid for with additional borrowing.<\/li>\n<li>The creditworthiness of the U.S. is once again back in the news. Rating agency Moody\u2019s raised the idea of a downgrade for U.S. debt last week.<\/li>\n<\/ul>\n<p><img decoding=\"async\" class=\"img-reponsive content-img-right\" src=\"https:\/\/www.moneymetals.com\/uploads\/content\/debt.jpg\" alt=\"Debt\" \/><\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Reckless Deficit Spending by Congress Set to Wreck the Dollar U.S. equities got a free ride on the Trump train after his election, even as Federal Reserve officials hiked interest rates. That ride may have ended last week. If commentators are correct and the blame for recent selling in the stock market falls on the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[11944,3575,17726,1796,839,5024],"class_list":["post-30911","post","type-post","status-publish","format-standard","hentry","category-economics","tag-clint-siegner","tag-deficit-spending","tag-monetary-metals","tag-us-congress","tag-us-dollar","tag-us-equities"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30911","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=30911"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30911\/revisions"}],"predecessor-version":[{"id":30912,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/30911\/revisions\/30912"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=30911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=30911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=30911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}