Is Trump Trying To Manipulate The Economy To Benefit Himself? Of Course He Is!

Would Trump put his own personal interests ahead of the country's interests? If anyone doesn't know the answer to that, it's useless trying to persuade them. In truth, if Trump could gain a quarter by costing the U.S. a billion, he would jump at it. Trump will sell us out to our enemies in a blink of an eye. The former president of Sudan, Omar al-Bashir, is on trial now for, among other things,  taking $90 million in bribes from Saudi Arabia's thuggish crown prince Mohammed Bin Salman, a crony and ally of Trump and his vile family. If Bin Salman was willing to give $90 million to the useless al-Bashir how much has he been willing to give the Trumps and Kushners? Is Trump on the take? You really have to ask? It's why Trump can't be allowed to slink off after his term and must be prosecuted, The precedents he has broken and set have to be expunged from our history or we will be doomed, as a nation and a society, to live with them forever. No other American ex-president has ever been imprisoned. Trump must be. (It's another reason to not vote for Biden, who will immediately pardon Trump and his family and regime if he ever gets into the White House.)

Over the weekend, the Washington Post assembled an A-Team to work on how Trump puts his own financial interests ahead of the country's well-being-- Jonathan O'Connell, David Farenthold and Heather Long. Short version: Señor Trumpanzee "stands to save millions of dollars annually in interest on outstanding loans on his hotels and resorts if the Federal Reserve lowers rates as he has been demanding." We'll get into it in a moment, but first I want to ask you if you saw the write-up I did Sunday of Benjamin Corey's thesis that Trump really is the Anti-Christ. Here are a couple of illustrations that connect Corey's theory and The Post theory:

Trump's Miami area golf resort, Doral, is a decrepit pigsty badly in need of renovations. Trump wants to host the next G-7 meeting there in 2020 so he can give the bill for the renovations to the U.S. taxpayers. That's who he is; it's who he's always been. A clue he is looking to profit was a statement he made earlier today: "My people wanted it. I'm not going to make any money." That can be translated into, "My staff warned me not to do anything this blatant but I want to soak Uncle Sam for every penny I can while I'm still able to."

Now, back to O'Connell, Farenthold and Long, who explained that "In the five years before he became president, Trump borrowed more than $360 million via four loans from Deutsche Bank for his hotels in Washington, D.C., and Chicago, as well his 643-room Doral golf resort in South Florida. The payments on all four properties vary with interest rate changes, according to Trump’s official financial disclosures. That means he has already benefited from falling interest rates that were spurred in part by a cut the Federal Reserve announced in July, the first in more than a decade-- and his payments could drop by millions of dollars more annually if the central bank grants Trump’s wish and further lowers short-term rates, experts said."

“It will reduce his borrowing costs quite a bit if he gets what he wants,” said Phillip Braun, a finance professor at Northwestern University’s Kellogg School of Management. Braun said Trump’s savings could be even greater if Deutsche Bank permits his company to pay down the loans more quickly without a penalty, which banks sometimes allow.

...While Trump’s adult sons, Donald Trump Jr. and Eric Trump, are managing the family business, the president insisted on retaining ownership of his company after his election, bucking the practice of past presidents. That decision, ethics experts warned, would lead to potential conflicts of interest between his personal interests and public policy goals.

The Trump administration has argued that lower interest rates would spur more consumers to buy homes and cars and businesses to invest in new factories. Cutting rates also typically lowers the value of the dollar, making U.S. products cheaper to overseas buyers, a goal of the president.

But most economists and business leaders say Trump’s trade war is the biggest threat to the economy, not interest rates, which are already at historically low levels.

Since taking office, Trump has aggressively sought to lower interest rates and rejected  the mostly hands-off approach other presidents have taken to the Fed, repeatedly blasting Chair Jerome H. Powell-- whom Trump appointed to the post last year-- for not falling in line.

On Friday, after Powell made no announcement of a rate cut and instead voiced concerns about Trump’s trade war with China, the president immediately attacked him on Twitter, writing that “As usual the Fed did NOTHING!” and comparing Powell to Chinese President Xi Jinping.

“My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?” Trump posted.

Trump and his advisers have privately discussed creating a rotation among the Federal Reserve governors that would reduce Powell’s influence, the Washington Post reported this past week.

Asked Friday night by reporters if he wanted Powell to resign, the president responded, “If he did, I wouldn’t stop him.”

...Experts said it’s difficult to ascertain exactly how much Trump would save if he gets the reduction in short-term interest rates that he has urged, from 2.25 percent to 1.25 percent-- a move typically reserved for economic emergencies.

But the president would be substantially impacted by a rate cut, they agreed.

Beginning in 2012, Deutsche Bank provide Trump’s company with about $364 million in loans by working through the bank’s private wealth division, rather than through traditional commercial lending units, according to public loan documents.

The borrowing was for two loans totaling $125 million to buy and renovate the Doral golf resort in Florida, a $170 million loan to renovate Washington’s Old Post Office Pavilion into a Trump hotel and a $69 million loan to refinance an existing Trump hotel in Chicago.

Trump’s financial disclosures and loan records indicate that all four of the loans remain outstanding. His company has paid down at least $19 million of the Chicago loan, according to the filings, though the documents do not show the amount of the remaining balances for any of the properties.

Trump could save at least $600,000 and as much as $1.1 million annually on just the larger of the two Doral loans if the Fed made a percentage point reduction, depending on the loan agreement, according to Clifford Rossi, a professor at the University of Maryland’s business school.

Even a quarter-point reduction, which most Wall Street investors now predict will occur in mid-September, could save Trump as much as $275,000 annually on that single Doral loan.

“If you’re a consumer borrower with a car loan or a credit card, a quarter-point reduction is significant savings,” Rossi said. Trump “has more loans and a bigger dollar size, so he would get certainly a larger reduction on the amount owed than most Americans out there.”

An analysis by Bloomberg News found that for every quarter-point reduction, Trump could save $850,000 in annual interest rate payments, which would mean more than $3 million in annual savings if the Fed dropped rates a full percentage point as Trump has demanded.

During his years as a real estate developer, Trump was famous for his aggressive efforts to save money, even when it meant breaking up relationships or shattering professional norms.

Trump has been sued dozens of times for nonpayment of bills, by building contractors, bartenders and even his own lawyers. He used money from a nonprofit charity to pay off legal settlements for his for-profit businesses. He once sued his own lender, Deutsche Bank, to get out of a large mortgage.

Before entering politics, Trump often advocated for lower interest rates, which are key for a business that relies on large sums of debt.

“Interest rates are very critical to the real estate industry, and [Trump has] spent his whole career there, so he has strong opinions about where interest rates should be,” said James Bullard, president of the Federal Reserve Bank of St. Louis. “Every real estate person I’ve ever met in my life has always wanted lower rates in all circumstances, so I think that’s part of [Trump’s] nature.”

In the 1980s, Trump became one of the most aggressive borrowers in the country, using cheap loans to finance an Atlantic City casino empire that ultimately failed and forced four of his companies to file for bankruptcy.

In the wake of that collapse, Trump was largely frozen out by big banks. He used cash to fund much of his company’s more recent real estate expansion, then turned to an increasingly risk-taking Deutsche Bank for some big loans starting in 2012...

Democrats in Congress have subpoenaed his Deutsche bank records, but Trump sued to stop the bank from responding and the matter remains mired in court.

Previous presidents have avoided publicly criticizing the Fed to maintain the board’s insulation from politics. Trump decided otherwise from the get-go and as global economic concerns mounted in recent weeks, he escalated his already routine attacks on Powell, tweeting at different times in July that “the Federal Reserve doesn’t have a clue!” and “They raised rates too soon, too often, and tightened, while others did just the opposite.”

Four former Fed chairs, collectively appointed and reappointed by six presidents, then published a Wall Street Journal op-ed urging that the Fed be allowed to act “free of short-term political pressures and, in particular, without the threat of removal or demotion of Fed leaders for political reasons.”

Trump further amped up the pressure Friday after Powell spoke at a meeting of central bankers in Jackson Hole, Wyo. The chair said the U.S. economy was in a “favorable place” but that the trade war Trump launched against China had created a “complex, turbulent” situation.

Trump responded with a tirade on Twitter, blaming China for a boatload of issues and demanding that U.S. companies avoid doing business there. Stock market investors, already wary of a shaky bond market and declining consumer confidence, began a sell-off that resulted in steep market losses.

Braun, the Northwestern professor, said Trump’s constant pressure on the Fed chair and his colleagues to adjust rates to suit the president’s liking could hurt the U.S. economy.

“I don’t think the Fed should be accommodating Trump’s trade war, and the risk is potential inflation and the reputation of the Fed in the future,” he said.

Fixing The Interest Rate Mess-- Bernie + AOC vs Biden + GOP

"Today’s loan sharks wear expensive suits and work on Wall Street, where they make hundreds of millions of dollars in total compensation by charging sky-high fees and usurious interest rates."
-Bernie Sanders and Alexandria Ocasio Cortez

This morning must have been horrible for Status Quo Joe. He had to bite his tongue as Bernie and AOC went on the offensive with their new consumer-protection proposal, the Loan Shark Prevention Act, that targets the people and industries that have underwritten Biden's entire slimy career as a devoted servant to the banksters. The AOC/Bernie bill would cap interest rates on all consumer loans at 15%, effectively eliminating the payday loan industry and save Americans significant money on their credit card debts. Biden is generally considered the credit card industry's #1 political ally and he's was serving their interests before AOC was born!

The usury cap has been introduced by Bernie for over a decade but Republicans, working with slimy corrupt Democrats like Biden, have managed to kill it each time. Remember, banks borrow from the Fed at a 2.5% rate and their credit cards charge as much as 23%, sometimes more when they are branded with department stores and airlines. Payday charge annual rates as high as 667%, so this would be curtains for them. Politicians like Biden and the GOP in general will squeal like stuck pigs that the effect of the proposal would be to reduce access to credit for low-income families, since they have to turn to the modern day loan sharks because of poor credit.

The hope is that revived postal banking (which ended in 1967)-- being pushed by Elizabeth Warren, Bernie and even a confused Wall Street ally like Kirsten Gillibrand-- will thrive in the space occupied by payday lenders.

Wednesday, Norman Solomon wrote what many low-info Democrats don't want to hear: Joe Biden Might as Well Be a Republican. Why? "Recent criticism of Joe Biden," he wrote, "for praising Dick Cheney as 'a decent man' and Mike Pence as 'a decent guy' merely scratches the surface of what’s wrong with the current frontrunner for the Democratic presidential nomination. His compulsion to vouch for the decency of Republican leaders-- while calling Donald Trump an 'aberration'-- is consistent with Biden’s political record. It sheds light on why he’s probably the worst Democrat running for president."

After several decades of cutting corporate-friendly deals with GOP legislators-- often betraying the interests of core Democratic constituencies in the process-- Biden has a big psychological and political stake in denying that the entire GOP agenda is repugnant.

At the outset of his Senate career, Biden lost no time appealing to racism and running interference for huge corporate interests. He went on to play a historic role in helping to move the Supreme Court rightward and serving such predatory businesses as credit card companies, big banks and hedge funds.

Biden’s role as vice president included a near-miss at cutting a deal with Republican leaders on Capitol Hill to slash Medicare and Social Security. While his record on labor and trade has been mediocre, Biden has enjoyed tight mutual alliances with moneyed elites.

The nickname that corporate media have bestowed on him, “Lunch Bucket Joe,” is wide of the mark. A bull’s-eye is “Wall Street Joe.”

With avuncular style, Biden has reflexively used pleasant rhetoric to grease the shaft given to millions of vulnerable people, suffering the consequences of his conciliatory approach to right-wing forces. Campaigning in Iowa a few days ago, Biden declared that “the other side is not my enemy, it’s my opposition.” But his notable kinship with Republican politicians has made him more of an enabler than an opponent. Results have often been disastrous.

“In more than four decades of public service, Biden has enthusiastically championed policies favored by financial elites, forging alliances with Wall Street and the political right to notch legislative victories that ran counter to the populist ideas that now animate his party,” HuffPost senior reporter Zach Carter recounts. Biden often teamed up with Senate Republicans to pass bills at the top of corporate wish lists and to block measures for economic fairness.

...Opposing measures for racial equity and economic justice, Biden’s operational bonds with GOP leaders continued. Carter reports that “on domestic policy-- from school integration to tax policy-- he was functionally allied with the Reagan administration. He voted for a landmark Reagan tax bill that slashed the top income tax rate from 70 percent to 50 percent and exempted many wealthy families from the estate tax on unearned inheritances, a measure that cost the federal government an estimated $83 billion in annual revenue. He then called for a spending freeze on Social Security in order to reduce the deficits that tax law helped to create.”

Biden came through for corporate power again in November 1993 when he joined with 26 other Democrats and 34 Republicans to win Senate passage of NAFTA, the trade agreement strongly opposed by labor unions and environmental groups. In mid-1996, when Congress approved President Clinton’s “welfare reform” bill, Biden helped to vote the draconian measure into law. It predictably had devastating effects on women and children.

Throughout the 1990s-- from tax-rate changes that enriched the already-rich to deregulating banks with repeal of the Glass-Steagall Act to loosening government curbs on credit default swaps-- Biden stood with the Senate’s Republicans and the most corporate-aligned Democrats. Carter sums up: “Biden was a steadfast supporter of an economic agenda that caused economic inequality to skyrocket during the Clinton years. . . . Biden voted for all of it.”

Biden led the successful push to pass the milestone 1994 crime bill, engaging in racist tropes on the Senate floor along the way. By then, he had become a powerful lawmaker on criminal-justice issues.

In 1991, midway through his eight years as chair of the Senate Judiciary Committee, Biden ran the hearings for Supreme Court nominee Clarence Thomas that excluded witnesses who were prepared to corroborate Anita Hill’s accusations of sexual harassment. “Much of what Democrats blame Republicans for was enabled, quite literally, by Biden: Justices whose confirmation to the Supreme Court he rubber-stamped worked to disembowel affirmative action, collective bargaining rights, reproductive rights, voting rights,” feminist author Rebecca Traister writes.

Early in the new century, Biden wielded another weighty gavel, with momentous results, as chair of the Senate Foreign Relations Committee. In 2002, congressional Democrats were closely divided on whether to greenlight the invasion of Iraq, while Republicans overwhelmingly backed President George W. Bush’s mendacious case for invading. Biden didn’t only vote for the Iraq invasion on the Senate floor in October 2002. Months earlier, he methodically excluded dissenting voices about the looming invasion at key hearings of the Foreign Relations Committee.

While his impact on foreign policy grew larger, Biden’s avid service to financial giants never flagged. One of his top priorities was a crusade for legislation to undermine bankruptcy protections. Biden was a mover and shaker behind the landmark 2005 bankruptcy bill. Before President Bush signed it into law, Biden was one of just 14 out of 45 Democratic senators to vote for the legislation.

The bankruptcy law was a monumental victory for credit-card firms — and a huge blow to consumers, including students saddled with debt. As happened so often during Biden’s 36 years in the Senate, he eagerly aligned himself with Republicans and a minority of Democrats to get the job done.

Now, running for president, Biden has no use for candor about his actual record. Instead, he keeps pretending that he has always been a champion of people he actually used his power to grievously harm.

In ideology and record on corporate power, the farthest from Biden among his competitors is Bernie Sanders. No wonder Biden has gone out of his way to distance himself from Sanders while voicing high regard for the wealthy. (I was a Sanders delegate to the 2016 Democratic National Convention and continue to actively support him.)

Biden’s ongoing zeal to defend and accommodate Republicans in Congress is undiminished, as though they should not be held accountable for President Trump even while they aid and abet him. Days ago on the campaign trail-- while referring to Trump-- Biden asserted: “This is not the Republican Party.” And he spoke warmly of “my Republican friends in the House and Senate.”

All in all, it’s preposterous yet fitting for Joe Biden to claim that Republicans like Dick Cheney and Mike Pence are “decent.” He’s not only defending them. He’s also defending himself.

More On The Bush Economic Miracle: Less Than Zero Interest Rate

People put their money in Treasury bills, even though they pay less interest than almost any other investment, because they are considered the safest investment on earth. The full faith and credit of the United States government stands behind them. So you can be sure you at least preserve your capital. And if you lose a little buying power because of inflation... well it won't be too much. At least it wouldn't have been until today.

Interest rates on four-week Treasury bills fell to zero in Tuesday's auction, as investors still sought the safety of government securities without any return on their investment.

The Treasury Department says it sold $32 billion in four-week bills at an interest rate of zero percent. That meant investors were willing to earn no return at all on their money as long as they cold park it in the safety of Treasury securities.

Today's L.A. Times reports that at one point in the day the rate actually dipped below zero. "In effect, a negative yield means some investors are so hungry for Treasuries that they’re willing to pay more for a security than they’ll get back when it matures, and earn no interest while they hold it." That happened at the height of the Great Depression, brought on by a series of presidents with a series of economic agendas very similar to the ones we've just been through. And tomorrow's NY Times paints a bleak picture: "In the market equivalent of shoveling cash under the mattress, hordes of buyers were so eager on Tuesday to park money in the world’s safest investment, United States government debt, that they agreed to accept a zero percent rate of return. The news sent a sobering signal: in these troubled economic times, when people have lost vast amounts on stocks, bonds and real estate, making an investment that offers security but no gain is tantamount to coming out ahead. This extremely cautious approach reflects concerns that a global recession could deepen next year, and continue to jeopardize all types of investments." Enjoy Elvis: