The Trump Slump?

The big run-up in equity values since the election of Donald Trump has been explained as a “Trump rally.” Since there is no such thing, there is no “Trump slump.”

The US stock market began its bull rally eight years ago. As massive numbers of people lost their equity value, which financiers describe as “distressed assets,” equity valuations, which are valued on demand, started moving up. This bullish trend has occurred, and still exists, against declining median income, falling productivity, and rising debt.

Now that the Fed says it will raise the interest rate, we will have low productivity against rising rents. In the realm of reasonable expectations, this means diminishing capacity to pay the debt in the futures, now.

The “natural” result is a credit crisis (the gamma-risk dimension I write about). Objectivists will be sure to describe it as naturally occurring cyclical risk that tends to distress assets without financiers actually intending it.

Profits naturally decline due to rising economic rents against the declining capacity to pay “on time.” The default condition (the declining rate of profit) is the result, which can then be described as a “Trump slump.”

The “Trump” attribution, however, is a material fraud (a pathological error of attribution). Since it naturally tends to occur, without actually intending to do the harm, as Objectivists describe it, the liability is naturally limited (but it does not actually reduce the real risk, deliberately accumulated into a catastrophic dimension “on demand” — which means, naturally, it is fully culpable, or assumed, having a clearly measurable, attributive value, existing in priority).

 

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About griffithlighton

musician-composer, artist, writer, philosopher and political economist (M.A.)
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