We’ll never see anything like Trump’s tax plan again.
Can we escape reality? Maybe.
In 2008 our national debt was $6 trillion. Today it’s $28 trillion. National debt is six times higher today.
In 2008 our GDP was $14 trillion in 2008. Today, it’s only $21 trillion. It grew by only 33%. Obviously something has to give.
It appears the government has decided to eliminate the difference with inflation. Not a bad idea, actually. Except for what creating hyper inflation will do to our standard of living, devaluing the dollar in the process and ruining the economy. Here’s a worse case scenario.
If their approach fails, we will be left holding the bag on the $28 trillion of national debt with a weakened economy that by then will have a GDP of only around $10 trillion, if that. But if it fails, we may end up with wheelbarrows full of hundred dollar bills trying to buy a loaf of bread. Which is reported to have happened under Germany & some South American countries under hyperinflation.
If it gets bad, the dollar will lose 50% of it’s buying power a week. It won’t take long for that to deteriorate into a barter system. “I’ll trade you a pair of shoes for two hot dogs.”
The country & the GDP won’t be the same as it is today, but for individual taxpayers, perhaps there’s a way to weather the storm, if you’re lucky. My recommendation is to get out of the stock market and put any idle cash into gold, silver or bitcoin. The stock market will probably crash sometime this year, but if you are in something that profits by inflation, you might be able to weather the storm. Gold, silver, copper & Bitcoin all fit that definition.
However, one of my favorite saying is this, “He who lives by the crystal ball, better learn to eat glass.”
So take everything, including my advice, with a grain of salt. I’m not even sure it would work. Maybe I’m missing something. Maybe it won’t be this bad. But I think drastic measures are called for. Who would have thought our country would turn into a banana republic overnight led by a senile president?
Crazier things have happened.