Trump Tariff Bomb Global Depression

● Trump’s Tariff Tsunami Devastates Global Markets

The Core of Trump’s Economic Pledges, Policy Failures, and the Vicious Cycle of Trade Wars

Trump’s Economic Pledges and Their Intentions

Under the goal of making America great and wealthier, Trump put forward several key pledges:

Setting price stability, or inflation control, as a top priority.
Including the intention to stimulate economic growth through interest rate cuts.
Seeking to protect and revive domestic industries by introducing trade wars.

The Correlation Between Trade Wars and Inflation

Trade wars were intended to promote domestic production by inducing short-term price increases in overseas products.
However, this resulted in the side effect of actually stimulating inflation, i.e., price increases.
If inflation rises, it becomes difficult to realize Trump’s key pledge of interest rate cuts.
As a result, it leads to contradictions between economic policies, which greatly affects internal evaluations.

Policy Implementation Results and Political Repercussions

Stimulating inflation through trade wars had short-term effects.
However, it negatively affected the realization of Trump’s economic pledges.
As a result of failing to curb inflation, interest rate cuts were also limited.
This economic situation caused a decline in the evaluation of Trump’s supporters and a shift in voter sentiment in the midterm elections.
The conclusion of Trump’s economic record eventually coincided with economic instability after COVID-19.

Biden Administration and Economic Future Prospects

The Biden administration is also struggling to solve the inflation problem.
In a similar context to Trump’s pledges, high prices and interest rates are major variables in the future.
Major economic issues such as tariffs, inflation, and interest rates are likely to continue to shake the political landscape.
Analyzing trends and policy failures across the economy,
Uncertainty in the economic market is expected to continue in the future.

Comprehensive Analysis of Economic Policies

Trump’s pledges were clear.
He tried to boost the domestic economy through price stability, interest rate cuts, and the introduction of tariffs.
However, trade wars actually stimulated inflation,
Making it impossible to cut interest rates, which was a subsequent policy.
This economic instability due to mutual contradictions dealt a major blow to Trump’s political forces.
In the end, the deterioration of real economic indicators led to a retaliatory effect in the midterm elections,
Suggesting the end of Trump’s era with political reassessment.
Economic experts emphasize once again how important it is to maintain a balance between market stability and policy implementation through these cases.

This article summarizes the details of Trump’s economic pledges, the side effects of trade wars that occurred in the process of implementing them, and
The impact of rising inflation on interest rate cuts and changes in the political landscape is organized in chronological order.
In particular, how key economic indicators such as inflation, interest rates, and trade wars interact and
It analyzes in detail how it led to political results.
Through keywords such as economy, inflation, interest rates, Trump, and trade wars,
You can understand the failure of US economic policy and its negative political effects.

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● U.S. Blunder-Global Depression Looms

U.S. Stock Market Bubble and Global Financial Crisis Outlook

1. Major Causes of the U.S. Stock Market Bubble Inflating

The Dow Jones plummeting to the 7,000s immediately after the 2009 Global Financial Crisis, and then soaring from 2001 to break record highs, surpassing 45,000, has sent shockwaves throughout the economy.

With over 60% of U.S. households diving into stock investments and the top 10 stocks accounting for 40% of the total market capitalization, the stock market bubble is excessively inflated.

In particular, with the market capitalization being more than three times the size of the U.S. economy and stocks like Tesla and NVIDIA having PERs exceeding 100, it is clear that the current bubble is formed by future earnings.

Furthermore, the fact that the top 10% of income earners own 93% of the total stock value suggests that an imbalance in consumption tendencies could act as a precursor to a financial crisis.

2. U.S. Economic Stimulus Policies and Recovery Mechanisms

Economic lockdowns and fiscal and monetary stimulus policies following the 2020 COVID-19 crisis led to a short-term economic recovery.

The U.S. Federal Reserve lowered the benchmark interest rate and significantly increased fiscal spending and monetary supply to block the economic downturn, but this also led to side effects such as economic overheating and soaring prices.

Thanks to high interest rates and a strong dollar policy, financial capital from other countries flowed into the U.S., leading to a short-term expansion of liquidity and a boom in the stock market.

While these policies led to the recovery of the U.S. economy, they also increased the risk of a panic collapse as the bubble grows.

3. U.S. Financial Crisis Signs and Potential Global Repercussions

Recently, the U.S. stock market has renewed its record highs by capitalizing on various themes (cryptocurrencies, electric vehicles, AI, etc.), but a panic collapse may occur in the short term if new themes are absent.

In particular, the bubble in the commercial real estate market and the decrease in financial capital inflows into the U.S. could act as signals of a U.S. economic downturn.

Moreover, similar bubble phenomena are appearing in major developed and emerging countries such as Germany, Japan, and China, so if a trigger occurs, it could spread into a global financial crisis.

This financial crisis poses a risk of leading to the collapse of the overall economy, especially the U.S. economy and stock market, so it should be watched closely.

4. Domestic Economic Outlook and Policy Response Challenges

Unlike the U.S., South Korea has a structure where domestic demand accounts for 90% of GDP, so if high exchange rate policies continue, there is a risk of weakening export competitiveness.

On the other hand, if the exchange rate gradually falls when the high exchange rate policy is abandoned, domestic and international financial capital may flow back into the country, leading to an economic boom.

Based on the experience of overcoming crises such as the past IMF crisis, if the government embarks on efficient exchange rate and economic policy transitions, a solid recovery of 5-6% growth can be expected.

Ultimately, the U.S. financial policy, the inflow of global financial capital, and the restructuring challenges due to domestic high exchange rate policies are all intertwined, significantly affecting the global and domestic economies. Therefore, systematic analysis and rapid policy responses are necessary.

Summary

The U.S. stock market is inflated with bubbles due to excessive investment enthusiasm, concentration of top companies, and high PER stocks, and it showed a temporary recovery thanks to fiscal and monetary stimulus policies after the 2020 COVID-19 pandemic. However, the risk of a panic collapse is increasing due to high interest rates, a strong dollar, a commercial real estate bubble, and a decrease in liquidity, so it could spread into a global financial crisis. South Korea can create an economic boom by aiming for exchange rate cuts and stimulating domestic demand by abandoning its high exchange rate policy. Major SEO keywords include economy, U.S. economy, financial crisis, exchange rate, and stock market.

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