NewsMax Roundup, 11/5/2024
Booming Stock Markets, Boeing Strike, and Political Spending
This Election Day, I appeared on NewsMax’s National Report.
For those that don’t know how “going on the news” works, you’re asked to appear on a certain program at a certain day/time a day or two in advance, sometimes more, sometimes less. In my case, I was asked yesterday, Monday 11/4. You’re scheduled to log in to their program by 9:15 AM for mic and video checks and then at 9:25 AM, you’re on live TV.
What’s less well known, though, is that you often don’t get any information on what you’ll be talking about until about 8:30 AM. Sometimes you’ll have a sense of what they’ll likely ask you about. In my case, if there’s a major economics report being released that day (which happens at 8:30 AM), I’m pretty confident that they’ll ask me about that. Other times, it’s a total crap shoot. Sometime before you go on, they’ll send you two or three links to some news articles that you’ll be asked about. For previous appearances, I’ve gotten these links as early as 7:30 AM and as late as 8:55 AM.
In a way, it’s a lot like studying for an exam in college. You have a pretty good sense of what the questions will be about, but you won’t know what the questions will actually be until you’re live. This can be nerve-racking but you get used to it and thanks to wonderful media training, you quickly develop some strategies to pivot to the points you want to make and are comfortable making.
Finally, you also know that your segment lasts a total of about 10 minutes and you’ll be sharing the spotlight with one other guest (though you won’t know who until you’re live). This means that you have to be succinct in your answers. Today, I was joined by Bryan Ganz, who was lovely and made some great remarks.
Here are the links I was sent this morning, fortunately at 8:15 AM:
https://www.cnbc.com/2024/11/04/stock-market-today-live-updates.html
https://www.cnbc.com/2024/11/04/striking-boeing-machinists-vote-new-contract.html
Given that I’m on NewsMax every week on Thursdays at 9:25 AM, I figured I’d use this space to elaborate on the issues presented and give a more longer-winded explanation of the stories I’m asked about. On this day, I got the stock market question while Bryan got the election spending question.
Stock Market Soars 400 Points
The stock market, at least as of this writing, is on a bit of a tear. This isn’t unprecedented during an election, especially the day of. While people like Jim Cramer argue that this is evidence that traders think Harris will win, I’m not totally convinced. What I think is going on is the market realization of two things: the near-certainty at this point of a 25 basis point cut in interest rates by the Fed later this week and that both Harris and Trump have effectively promised a massive fiscal stimulus, albeit of different flavors.
Harris is, obviously, promising a litany of spending programs and increased funding for existing programs.
Trump, at least in the last few weeks of the campaign, is giving out tax cuts like Oprah Winfrey gives out cars.
Both of these have the same macroeconomic effect: boosting aggregate demand.
What concerns me about all of this, though, isn’t so much the why the stock market is rallying right now, it’s more about the following questions:
What steps are being taken to get the economy off of the government’s teat?
Are these tax cuts and spending programs even remotely sustainable in the long term?
The US economy is currently very much on the government’s teat. Just looking at raw numbers reveals this: with a federal budget for FY23 of almost $7 trillion and a GDP of $27.7 trillion, we’re already at over 20% of total GDP coming from the federal government alone. Moreover, this is a massive understatement, as “spending money” is not the only way in which the government exerts influence over the economy. This needs to change.
Similarly, the CBO projects that, regardless of who wins the 2024 election, the federal debt will exceed $50 trillion by 2034. With the Census Bureau projecting a population of about 365 million people in 2034, this gives us $137,000 of debt for every man, woman, and child in the US in 2034, as a minimum. This cannot continue.
Something needs to be done to reverse these trends.