{"id":7826,"date":"2025-04-22T09:13:38","date_gmt":"2025-04-22T13:13:38","guid":{"rendered":"https:\/\/dahlman.online\/?p=7826"},"modified":"2025-04-22T09:13:40","modified_gmt":"2025-04-22T13:13:40","slug":"holding-the-bag","status":"publish","type":"post","link":"https:\/\/dahlman.online\/index.php\/2025\/04\/22\/holding-the-bag\/","title":{"rendered":"Holding the Bag"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\">Dow Jones<\/h3>\n\n\n\n<p class=\"\">Jenn and I took a long ride in the truck yesterday, to check out a pole vault pit in Northeastern Ohio.&nbsp;&nbsp;Along the way we listened as the \u201cold fashioned\u201d indicator&nbsp;&nbsp;of the stock market, the Dow Jones Industrial Average, fell almost 1000 points.&nbsp;&nbsp;Like almost everything else today, \u201c1000 points ain\u2019t what it used to be\u201d.&nbsp;&nbsp;I remember teaching about Black Monday and Tuesday in 1929, the beginning of the Great Depression.&nbsp;&nbsp;The Dow lost over 60 points in two days, the mythical \u201cjump out of the 40<sup>th<\/sup>&nbsp;Floor window\u201d time on Wall Street.&nbsp;&nbsp;But 60 points was 23% of the market value back then.&nbsp;&nbsp;That\u2019s 9000 points on the Dow Jones today.<\/p>\n\n\n\n<p class=\"\">Thank goodness we aren\u2019t there yet.\u00a0\u00a0But the markets lost trillions of dollars in value yesterday, and that\u2019s not a \u201cgood thing\u201d for most people.\u00a0\u00a0In our era, most Americans are directly or indirectly invested in the market.\u00a0\u00a0Got a 401-k retirement plan at work?\u00a0\u00a0You\u2019re in the market.\u00a0\u00a0Got a full pension plan?\u00a0\u00a0You\u2019re in the market.\u00a0\u00a0Retired and collecting a government or teacher\u2019s pension now?\u00a0\u00a0A significant portion of the money \u201cbacking\u201d your pension is in the market.\u00a0\u00a0<\/p>\n\n\n\n<p class=\"\">We\u2019ve been through market \u201cdisasters\u201d before.\u00a0\u00a0Less than five years ago, the Covid pandemic caused a market crash, dropping by over 10,000 points and losing a third of its value.\u00a0\u00a0And many Americans remember the housing bubble crash of 2008, when the market lost half its value.\u00a0\u00a0But this particular economic disaster today is fully man made.\u00a0\u00a0And that man\u2019s name is Donald Trump.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Biden\u2019s Gift<\/h3>\n\n\n\n<p class=\"\">Joe Biden handed Trump a booming economy.\u00a0\u00a0The markets were at record breaking levels, with the Dow Jones over 45,000 (it closed yesterday at 38170, down 16% in just four months).\u00a0\u00a0Unemployment was down to under 4%.  And the bugaboo of the Biden administration, inflation, was finally back to under 3%.\u00a0\u00a0Sure, prices skyrocketed for a while under Biden\u2019s watch, the results of Covid supply issues and the Government programs that \u201ccarried\u201d many Americans through the Covid employment crisis.\u00a0\u00a0But prices not only stabilized, but were going back down on most goods.\u00a0\u00a0And meanwhile, wages increased almost to match the \u201cflow\u201d of costs.<\/p>\n\n\n\n<p class=\"\">All Trump had to do was keep his hands off the economy, and let the \u201cCovid recovery\u201d continue.&nbsp;&nbsp;Instead, to use a couple of worn out phrases, \u201che upset the apple cart\u201d, and \u201cthrew the baby (the economy) out with the bath water\u201d.&nbsp;&nbsp;And he did so because he subscribes to an arcane theory of world economics, one that Trump acknowledges comes out of \u201cAmerica\u2019s Gilded Age\u201d of the 1880\u2019s and \u201890\u2019s.<\/p>\n\n\n\n<p class=\"\">The \u201cGilded Age\u201d was really only \u201cgilded\u201d for industrialists.\u00a0\u00a0It was the age of Andrew Carnegie, John Rockefeller, JP Morgan, and Cornelius Vanderbilt.\u00a0\u00a0They were men of enormous wealth and power, able to control both their industries and political actions.\u00a0\u00a0\u00a0It was an era of the \u201cTitans of Industry\u201d, or the \u201cRobber Barons\u201d, depending on perspective.\u00a0\u00a0\u00a0But for the average American worker, it wasn\u2019t particularly gilded.\u00a0\u00a0Labor was cheap, hours were long, conditions were dangerous.\u00a0\u00a0Injury meant loss of income; there was no such thing as \u201cworkmen\u2019s compensation\u201d.\u00a0\u00a0\u00a0It was good time for industrialists, but bad for industrial workers.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Robber Barons<\/h3>\n\n\n\n<p class=\"\">Trump sees America in a second \u201cGilded Age\u201d, and surrounds himself with the \u201crobber barons\u201d of our current era:&nbsp;&nbsp;Musk, Linda McMahon (who\u2019d have thought \u201cBig Time Wrestling\u201d was a billion dollar business!), Burgham, Bessett, Lutnick and the rest.&nbsp;&nbsp;&nbsp;To those folks, like their predecessors in the 1880\u2019s; the absolute \u201cfreedom\u201d to do what they want with their fortunes without government restriction is paramount.&nbsp;&nbsp;That outlook is demonstrable in the Trump Administration\u2019s widespread attack on government regulation.&nbsp;&nbsp;All of that is \u201cgood for the billionaires\u201d, but not so good for the rest of us.<\/p>\n\n\n\n<p class=\"\">The second \u201ctheory\u201d lifted from the Gilded Age is Trump\u2019s tariff policy.&nbsp;&nbsp;In the 1880\u2019s, the United States was a growing industrial competitor in the world, working to build industry under protection against foreign competition through tariffs.&nbsp;&nbsp;Most products, from shoes to shirts to vehicles, were made here.&nbsp;&nbsp;But the US wasn\u2019t a \u201cworld leader\u201d in anything in those days.<\/p>\n\n\n\n<p class=\"\">Today, the US has the most powerful economy in the world.\u00a0\u00a0The US has 26% of the world\u2019s gross  production.\u00a0\u00a0China is second with 16% and Germany third with 4%.\u00a0\u00a0The world\u00a0leader\u00a0doesn\u2019t need \u201cprotection\u201d. Realistically, other economies need protection from the US.\u00a0\u00a0So the tariff policy of the \u201cGilded Age\u201d essentially puts the United States in the wrong role.  We have the advantage right now, instead of other nations (like China) who are in the \u201cup and coming\u201d position.  Ultimately, tariffs are likely to hurt our economy more than help.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Wrong Tariffs, Wrong Time<\/h3>\n\n\n\n<p class=\"\">Meanwhile, the tariff policy completely disrupted the \u201cCovid Recovery\u201d economy of Joe Biden.\u00a0\u00a0Instead of things continuing to improve for the average American, we now are looking at a looming recession, with prices and unemployment going up, and investments and retirements at risk.\u00a0\u00a0The \u201cgilded advisors\u201d of Trump say we just have to \u201ctake the medicine&#8221;.   But the resulting cure is likely to be good for them, not us.<\/p>\n\n\n\n<p class=\"\">Trump essentially won the Presidency on two issues; inflation and America\u2019s changing culture.\u00a0\u00a0His economic policy is going to give America more inflation, lower wages, and less economic security.\u00a0\u00a0What it will do is help his billionaire friends.\u00a0\u00a0There\u2019s no better time to have money, then when no one else has it.\u00a0\u00a0That\u2019s how Joseph Kennedy, grandfather of the current Secretary of Health and Human Services, made his fortune.\u00a0\u00a0The Great Depression made his millions worth even more.\u00a0\u00a0But that didn\u2019t help America\u2019s regular folks, then, and it won&#8217;t now.\u00a0\u00a0<\/p>\n\n\n\n<p class=\"\">They just get left holding the empty bag.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Dow Jones Jenn and I took a long ride in the truck yesterday, to check out a pole vault pit in Northeastern Ohio.&nbsp;&nbsp;Along the way we listened as the \u201cold fashioned\u201d indicator&nbsp;&nbsp;of the stock market, the Dow Jones Industrial Average, fell almost 1000 points.&nbsp;&nbsp;Like almost everything else today, \u201c1000 points ain\u2019t what it used to &hellip; <a href=\"https:\/\/dahlman.online\/index.php\/2025\/04\/22\/holding-the-bag\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Holding the Bag&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","om_disable_all_campaigns":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[],"class_list":["post-7826","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - 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