Tidbits

[Ulti]

https://paulkrugman.substack.com/p/the-economic-excuse-industry-is-booming?isFreemail=true&post_id=158833872&publication_id=277517&r=9qf5o&triedRedirect=true&utm_campaign=email-post-title&utm_medium=email&utm_source=post-email-title

[formthirteen]

48 minutes ago, Ulti said:

https://paulkrugman.substack.com/p/the-economic-excuse-industry-is-booming?isFreemail=true&post_id=158833872&publication_id=277517&r=9qf5o&triedRedirect=true&utm_campaign=email-post-title&utm_medium=email&utm_source=post-email-title

 

Thanks. Great analysis and valid points.

 

Just for laughs, and maybe to learn a thing or two, I used AI to create a virtual debate around two real articles published on the internet by two economists, Paul (The Economic Excuse Industry is Booming) and Torsten (What Is the Mar-a-Lago Accord?). Remember to not take AI too seriously, AI makes things up, just like politicians and magicians:

 

 

Spoiler

A Debate Between Pauly and Mar-a-lago

Pauly:

Let me be clear about what's happening here. The Trump administration made extravagant economic promises during the campaign without any concrete plans to deliver on them. Now that reality is setting in – with consumer confidence deteriorating and markets tumbling – they're manufacturing excuses.

Treasury Secretary Bessent claims we need a "detox period" from government spending addiction, but this is pure fiction. Government purchases as a share of GDP didn't surge under Biden. Government employment didn't either. The data simply doesn't support their narrative.

What we're seeing is a cover story for policy failure. They're blaming a non-existent problem to justify disappointing economic performance, all while Musk's DOGE initiative claims savings that don't stand up to scrutiny. This isn't economic strategy – it's dishonesty.

Mar-a-lago:

Pauly raises valid concerns about economic promises versus reality, but I think he's missing the bigger structural issue at play here. The core challenge isn't about government spending levels but about America's position in the global economy.

The US dollar faces persistent upward pressure as the world's reserve currency, which fundamentally hurts our manufacturing competitiveness. What I've outlined as the "Mar-a-Lago Accord" isn't about excuses – it's about rebalancing international economic relationships to America's advantage.

Yes, there will be adjustment periods, but the goal is strategic: the US provides security and market access to allies, and in return, these countries help weaken the dollar and support American manufacturing growth. This isn't about blaming the previous administration; it's about addressing a long-term structural imbalance through tariffs and currency management.

The question isn't whether the previous economy was "terrible" – it's whether we can transition to a more manufacturing-focused economy that brings jobs back to America without triggering excessive inflation or global economic friction.

Pauly:

That's precisely the problem with your "Mar-a-Lago Accord" concept. It sounds sophisticated but rests on dubious economic assumptions. First, currency manipulation isn't a magic solution – deliberate dollar weakening would risk inflation and potentially destabilize our position as the reserve currency.

Second, you're assuming other countries would willingly participate in this scheme while simultaneously facing American tariffs. Why would they help devalue the dollar when we're restricting their access to our markets? It's contradictory.

And your manufacturing focus overlooks a basic reality: manufacturing jobs have declined primarily due to automation, not just trade. Even with a weaker dollar, many of these jobs aren't coming back in the numbers being promised.

What's happening is classic misdirection. Rather than admitting their policies aren't delivering immediate results, they're concocting elaborate theories about dollar dynamics to justify disappointing economic performance.

Mar-a-lago:

Pauly, you're overlooking that the current global economic structure consistently advantages certain countries at America's expense. Reserve currency status has benefits, but it also creates persistent trade imbalances that have hollowed out American manufacturing for decades.

The Mar-a-Lago Accord isn't about currency manipulation in the traditional sense – it's about rebalancing a system that's become tilted against American workers. Yes, automation plays a role, but countries like Germany maintain strong manufacturing sectors despite high wages and automation. The difference is their strategic economic positioning.

Regarding why countries would participate: because America provides critical security guarantees and market access that they desperately need. Tariffs are a negotiating tool, not the end goal. They create leverage to bring countries to the table. Once agreements are reached, targeted tariffs would remain only where necessary to maintain balance.

This isn't about excuses for short-term performance – it's about the difficult but necessary transition to a more balanced global economic structure that better serves American interests. Yes, there will be adjustment costs, but the alternative is continuing a system that has systematically disadvantaged American manufacturing for decades.

 

Spoiler

Continuing the Debate

Pauly:

Let me focus on a fundamental economic reality that the administration seems to misunderstand. The only government spending that directly affects GDP — the spending Bessent says needs to fall — is spending that directly buys goods and services. It's a basic principle of national accounting.

Looking at the data on government purchases as a share of GDP over time, there was no surge under Biden. In fact, government purchases are a smaller share of GDP now than they were under Reagan, mainly because we spend less on defense. Transfer payments like Social Security have increased, but these aren't part of GDP calculation since they're simply moving money between Americans.

So when Bessent talks about a "detox" from government spending, he's creating a narrative about an addiction that doesn't exist in the data. The economic slowdown can't be blamed on withdrawing from excessive government spending because that spending wasn't driving our economy in the first place.

Mar-a-lago:

Pauly is technically correct about how GDP is calculated, but this focus on government purchases versus transfers misses the broader economic reality. While direct government purchases may not have surged dramatically, the total fiscal impact of government policies extends far beyond what shows up in the GDP calculation.

The massive fiscal stimulus during and after the pandemic created distortions throughout the economy. Yes, much of this was through transfers rather than direct purchases, but those transfers still influenced consumption patterns, labor market dynamics, and inflation pressures. The economy became accustomed to this extraordinary fiscal support.

What Secretary Bessent is describing as a "detox" is the economy adjusting to a more sustainable fiscal path. This adjustment isn't just about the accounting definitions of GDP; it's about the broader macroeconomic environment and market expectations that were shaped by unprecedented government intervention.

The Mar-a-Lago Accord approach recognizes that we need to transition to a different growth model – one less dependent on fiscal stimulus and more focused on manufacturing competitiveness and export growth. This requires both domestic policy adjustments and international coordination to rebalance global trade and currency relationships.

Rather than debating what counts in GDP calculations, we should focus on the practical challenge: how do we transition to sustainable growth without the extraordinary fiscal measures of recent years? That's the adjustment process the administration is addressing.

 

Edited March 15, 2025 by formthirteen

[Spekulatius]

Squid games:

https://www.acadian-asset.com/investment-insights/owenomics/the-squid-game-stock-market?utm_source=substack&utm_medium=email

[Spekulatius]

I said this before, manufacturing jobs don’t pay that well any more and service jobs have closed to the gap since COVID-19. It’s going to be hard to bring these jobs back because people won’t take them, at least not those that are qualified.

 

[DooDiligence]

Ignore the headline. This is a provocative discussion about RE brokerages.

 

 

[Spekulatius]

Just me:

https://archive.ph/kQJ9y

[dwy000]

And its showing up in the birth rates. We are going to see population declines resembling the results of China's one-child policies of decades ago. 

[DooDiligence]

3 hours ago, Spekulatius said:

Just me:

https://archive.ph/kQJ9y

 

The patriarchy is not amused.

[Gregmal]

This is what happens when you raise boys not to be alphas…

[gfp]

1 hour ago, dwy000 said:

And its showing up in the birth rates. We are going to see population declines resembling the results of China's one-child policies of decades ago. 

 

sounds bad!  If only there were some way we could lure some young latinos to our country - we'd have it made!

[Sweet]

3 hours ago, Spekulatius said:

Just me:

https://archive.ph/kQJ9y

Expectations have changed.  The people who get married and have kids are also the people who are happy not having the biggest house, nicest car, hottest partner, or best career.  
 

In other words, if you are a person looking to be the best and have the best I don’t think you’re ready for the compromises it takes to get married and have kids.  

 

It’s hard.

[DooDiligence]

6 minutes ago, Sweet said:

Expectations have changed.  The people who get married and have kids are also the people who are happy not having the biggest house, nicest car, hottest partner, or best career.  
 

In other words, if you are a person looking to be the best and have the best I don’t think you’re ready for the compromises it takes to get married and have kids.  

 

It’s hard.

 

I don't think expectations have changed. Women are simply tired of the "grab 'em by the pussy crowd".

[cubsfan]

15 minutes ago, Sweet said:

Expectations have changed.  The people who get married and have kids are also the people who are happy not having the biggest house, nicest car, hottest partner, or best career.  
 

In other words, if you are a person looking to be the best and have the best I don’t think you’re ready for the compromises it takes to get married and have kids.  

 

It’s hard.

 

Damn, for once we agree!

[Sweet]

Just now, cubsfan said:

 

Damn, for once we agree!

Before Trump we agreed on nearly everything lol.  

[cubsfan]

Just now, Sweet said:

Before Trump we agreed on nearly everything lol.  

 

Good to see you are coming around ! 

[Sweet]

8 minutes ago, DooDiligence said:

 

I don't think expectations have changed. Women are simply tired of the "grab 'em by the pussy crowd".

Not many men are actually like that in my experience though.

 

Have you ever seen how men and women score the opposite sex on dating apps?

 

Its quite a story.

 

[cubsfan]

1 minute ago, Sweet said:

Not many men are actually like that in my experience though.

 

Have you ever seen how men and women score the opposite sex on dating apps?

 

Its quite a story.

 

 

Holy shit!  Good thing I'm married!

[DooDiligence]

2 minutes ago, Sweet said:

Not many men are actually like that in my experience though.

 

Have you ever seen how men and women score the opposite sex on dating apps?

 

Its quite a story.

 

 

You must not talk to many women.

[Gregmal]

Doo no one is talking about being the gay friend…

[Sweet]

1 hour ago, cubsfan said:

 

Holy shit!  Good thing I'm married!

Lol, same.  Marriage is about settling for me.  When I just accepted yeh, I just have to accept this is my lot lol.

 

 

1 hour ago, DooDiligence said:

 

You must not talk to many women.

You’re right, I’m married now

[LC]

It's an economic warzone out there:

Married couples had $393,000 in median wealth in 2022, according to the St. Louis Federal Reserve, while unmarried people, including those who were partnered but not married, had $80,000

 

Men who are educated, have decent jobs, and don't have 1950s attitudes towards gender roles - they do great.

 

The remaining stay poor, single and wind up voting for Trump

I mean, have you seen single dudes out there these days? I wouldn't want my daughters marrying "Proud Boys"

 

(And speaking of the gay friend - can you think of a more fabulous name than the 'Proud Boys!')

 

Jokes aside - look I was in my 30s, divorced, had a decent job, decent prospects, halfway in-shape, semi-progressive values...I was beating them back with a stick. And trust me, I am no Brad Pitt - not by a long shot.

 

I think if a lot of men just made even half an effort to temper and modernize some of their values, they would do a lot better.

Edited March 23, 2025 by LC

[Sweet]

6 minutes ago, LC said:

 

(And speaking of the gay friend - can you think of a more fabulous name than the 'Proud Boys!')

 

[Gregmal]

20 minutes ago, LC said:

Jokes aside - look I was in my 30s, divorced, had a decent job, decent prospects, halfway in-shape, semi-progressive values...I was beating them back with a stick.

You went to the Middle East for a sabbatical, did you? Heard its a blast there!

[LC]

Crap,  I laughed

 

You know the ME is the one region I haven't traveled. I had an old friend who vacations in Dubai but I never saw the appeal. Ride a camel in the scorching desert? No thanks, rather a horse in a place where water flows naturally.

[Spekulatius]

2 hours ago, LC said:

It's an economic warzone out there:

Married couples had $393,000 in median wealth in 2022, according to the St. Louis Federal Reserve, while unmarried people, including those who were partnered but not married, had $80,000

 

Men who are educated, have decent jobs, and don't have 1950s attitudes towards gender roles - they do great.

 

The remaining stay poor, single and wind up voting for Trump

I mean, have you seen single dudes out there these days? I wouldn't want my daughters marrying "Proud Boys"

 

(And speaking of the gay friend - can you think of a more fabulous name than the 'Proud Boys!')

 

Jokes aside - look I was in my 30s, divorced, had a decent job, decent prospects, halfway in-shape, semi-progressive values...I was beating them back with a stick. And trust me, I am no Brad Pitt - not by a long shot.

 

I think if a lot of men just made even half an effort to temper and modernize some of their values, they would do a lot better.

I think there is a lot of selection bias here. People who are married have above average income to begin with and on average have a better education. Poor people tend to stay single.

 

Combining too incomes also has financial synergies compared to staying single. Homebuying is easier with 2 incomes rather than one. Owning a home has a strong correlation with building wealth.

 

On the WSJ articles one of the striking things is that young women now tend to do better than your men in terms of eduction which I think will soon enough lead to them earning more than men too.

 

Hate to say it, but many young men are losers now, no professional perspectives, can’t buy a home ,no dates , no sex. I think this is one reason why they skew MAGA.