U.S. Economy September 2025-

What is the ‘Mar-a-Lago Accord,’
the next wacky scheme from Trump’s America?

Macro & Markets: Mar-a-Lago accord?
There has been much focus that Trump could force the US trading partners into a “Mar-a-Lago Accord” to weaken the dollar.
In Trump’s opinion the main reason for the demise of the American Dream is an artificially strong dollar which has led to the dismantlement of US manufacturing and loss of “well-paying blue collar jobs”. The strong dollar is a result of its status as reserve currency which amplifies investments into the US. With local manufacturing uncompetitive, the US is then forced to increase imports leaving it dependent of foreign countries for a number of goods. With other countries (China for instance) unfairly supporting their manufacturing sector, the problem is amplified. Connected to this problem is also the US role of global police, leaving it with a large military cost burden which again leads to public deficits and debts (easily financed because of the dollar’s reserve status).(27 March)

4 July
Trump’s $1K investment accounts roll out for eligible newborns
(The Hill) The Trump administration on Saturday launched its newborn investment program, called “Trump Accounts,” opening the federal savings accounts for millions of children in line with America’s 250th anniversary.
Trump Accounts are available to anyone with a Social Security number under the age of 18. Qualifying children born between Jan 1, 2025, and Dec. 31, 2028, are also given a one-time deposit of $1,000 if enrolled in the program.
More than six million of the “Trump Accounts” have been opened to date, and 1.4 million of those will receive the seed contribution for babies born during President Trump’s second term, according to the Treasury Department.

22 June
Alan Greenspan, Who Led Fed During Boom Before 2008 Bust, Dies at 100
Alan Greenspan, the former Federal Reserve chairman, has died at the age of 100 due to complications of Parkinson’s disease.
Greenspan served as Fed chief for 18 years, from 1987 to 2006, and was known for guiding a record US economic expansion, but his legacy was later dimmed by the financial crisis that erupted after he stepped down.
Greenspan’s tenure was marked by a stock market boom and low unemployment, but he was also criticized for his hands-off approach to financial markets and bubbles, which some said contributed to the worst economic meltdown since the Great Depression.
Alan Greenspan, the Federal Reserve chairman [was] proclaimed a wizard for guiding a then-record US economic expansion, only to see his luster dimmed by the financial crisis that erupted less than two years after he stepped down.
Greenspan’s 18 years as Fed chief, from 1987 until his retirement at the start of 2006, were marked by a stock market boom and low unemployment. More so than the four presidents he served under or the seven Treasury secretaries he worked alongside, Greenspan was seen as the maestro who kept the economy humming.
Greenspan’s tenure was the second-longest for a Fed chief, behind that of William McChesney Martin Jr. It coincided with the steadiest period of economic growth since the central bank’s creation in 1913, a 10-year run between a recession that ended in March 1991 and another that began in March 2001.
He became chairman of the Council of Economic Advisers in 1974, serving under Nixon and President Gerald R. Ford. Learning how to be politically circumspect took time. Responding to an assertion that mothers on welfare had suffered the most in the mid-1970s recession, Greenspan said stockbrokers had the biggest loss of income in percentage terms. Although the statistic was accurate, he was pilloried, as was the Ford administration. … (Bloomberg)

18 June
What smart people are saying after Fed chair Kevin Warsh’s debut
(Business Insider) The Federal Reserve held interest rates steady on Wednesday, but the bigger story was the man behind the podium.
In his first meeting as Fed chair, Kevin Warsh struck a firm tone on inflation, signaling that the central bank’s focus remains squarely on getting price growth back under control.
Warsh also used the occasion to preview a broader shakeup at the Fed, signaling plans to rethink everything from economic forecasts and forward guidance to the institution’s use of AI and internal operations.

1 June
Former Fed chair Jerome Powell receives JFK Profile in Courage award
(NPR) Former Federal Reserve chairman Jerome Powell was honored with the “Profile in Courage” award for helping to safeguard the central bank from political pressure from the White House.
In his eight years as chairman of the Federal Reserve, Jerome Powell faced a variety of economic challenges, from double-digit unemployment during the pandemic to the highest inflation in four decades. But Powell’s tenure may be best remembered for the way he stood up to political pressure from President Trump. The former Fed chairman was recognized for that response last night.

15 May

‘Costs are down!’ Trump declares inflation ‘solved’ as gas and grocery prices soar
(Raw Story) President Donald Trump has declared inflation “solved” as Americans are paying more for everyday goods like gas and groceries.
“I’ve already solved inflation,” Trump told “Fox & Friends” on Friday [12 September] morning. “Costs are down.”
Inflation is now the highest it’s been since January, according to CNBC.

Paul Krugman: My President Went to China, and All I Got Was Even More Expensive Gasoline
Higher oil exports hurt most Americans
… We still have a looming crunch because a significant amount of oil demand is being met by drawing down inventories and we’re kind of getting to crunch point there but that’s a whole other issue.
Now the downside for the United States is that more oil shipped abroad, unless we have a large increase in US production— which is not happening and won’t happen any time quickly — that means more oil being shipped abroad means less oil for the US market so prices have risen.
… on balance, certainly 80, 85% or more of the US public is a net loser from higher oil prices and hence a net loser from increased US sales of oil abroad.
Okay, you can think of a couple of ways that you might be able to change that conclusion. It would be more beneficial to the US public at large if oil companies paid a lot of taxes on their profits. Well, I can stop right there. Obviously the oil industry has historically been famous for not paying very much in taxes.
It could be a good thing for the American public if wealthy investors who have capital gains as a result of this surge in oil prices pay a lot more in taxes. But again we can stop right there. The U.S. system in general gives people who derive their standard of living, their wealth, their income from capital gains a much, much lower burden than ordinary people. …

14 May
He Was Good at Steering the Fed, but He Was a Genius at Ignoring Trump’s Threats
By Jason Furman, chairman of the White House Council of Economic Advisers from 2013 to 2017.
(NYT Opinion) )… I didn’t mind having to pick a Republican. …. But a lawyer with no formal academic training in macroeconomics? That strained my deep-seated economist partisanship. Mr. Powell had something more valuable than academic credentials, though. He had a demonstrated record of integrity and courage. Little did any of us realize how important these qualities would prove to be. …
A decade and a half later, Mr. Powell’s tenure as Fed chair is coming to an end. In normal times, this would be the moment to look back at his policies and performance. We’d be noting that under his leadership, the Fed succeeded in keeping the pandemic from turning into a financial crisis but failed to avoid 7 percent inflation. But these are not normal times, and Mr. Powell’s policy successes and failures are not what he’ll be remembered for.

20 March
The U.S. Economy Is Insulated From High Oil Prices. Americans Aren’t.
The overall economy has proved resilient in recent years, even as many households have struggled. The war with Iran is following the same pattern.
(NYT) The defining narrative for the U.S. economy over the past several years has been one of remarkable resilience in the face of inflation, tariffs and all manner of uncertainty. For individual Americans, however, the same period has often been defined by frustration, insecurity and, in many cases, real hardship.
The war with Iran looks set to repeat that pattern.
The jump in oil prices to over $100 a barrel in recent weeks will push nearly every major economic variable in the wrong direction. Inflation will be faster. Growth will be slower. Unemployment will most likely be higher. If the war were to last longer than expected, or energy prices were to go higher — as they have in recent days — the damage would grow.
Still, unless the situation takes a significant turn for the worse, the impact will most likely be modest, measured in tenths of a percentage point of economic growth.
… Measures of consumer sentiment have been persistently weak as inflation and high interest rates have taken a toll on household finances. President Trump won back the White House partly by promising to control inflation, then proceeded to impose tariffs that drove up the price of imported goods, according to nearly all independent analyses.
Now the U.S.-Israeli war with Iran is threatening to deliver another inflationary blow just as the effects of tariffs were beginning to fade.

18 March
US national debt surges past $39 trillion just weeks into war in Iran
(AP) — The national debt surpassed a record $39 trillion on Wednesday, a milestone that comes just weeks into the U.S.-Israeli war in Iran.
The unprecedented figure highlights competing administration priorities, from passing a massive tax law and boosting defense spending and immigration enforcement to chipping away at the debt itself — the latter of which Donald Trump promised to do as both a candidate and as president.
The Government Accountability Office outlines some of the impact of rising government debt on Americans — including higher borrowing costs for things like mortgages and cars, lower wages from businesses having less money available to invest, and more expensive goods and services. Advocates for a balanced budget also warn that the long-term trend of borrowing more and paying more in interest will force Americans to face tougher fiscal tradeoffs ahead.

11 February
CBO: Federal deficits and debt to worsen over next decade
(AP) — The nonpartisan Congressional Budget Office’s 10-year outlook projects worsening long-term federal deficits and rising debt, driven largely by increased spending, notably on Social Security, Medicare, and debt service payments.
Compared with the CBO’s analysis this time last year, the fiscal outlook has deteriorated modestly.
Major developments over the last year are factored into the latest report, released Wednesday, including Republicans’ tax and spending measure known as the “One Big Beautiful Bill Act,” higher tariffs, and the Trump administration’s crackdown on immigration, which includes deporting millions of immigrants from mainland U.S.

8 February
Trump wants to run the economy hot, as midterm elections approach
The White House bets on AI-driven productivity gains boosting wages without spooking the Federal Reserve.
(WaPo) Amid signs that the U.S. economy may be poised to accelerate, Trump administration officials are predicting an economic boom that will lift Republican prospects in the November congressional elections.
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The administration aims to run the economy hot, counting on a rare trifecta to boost growth in 2026: generous tax refunds and investment incentives, Federal Reserve interest rate cuts and the pruning of regulations that corporate groups call burdensome. Productivity gains from wider deployment of artificial intelligence will keep inflation at bay, officials said.
Most private sector forecasters anticipate solid growth this year and see little risk of recession. But they describe the stimulative effects of government policy as more modest and likely to be offset by drags from Trump’s immigration and tariff initiatives. Some warn that any economic liftoff will be insufficient to reverse sagging consumer sentiment before voters decide which party to back in November.

30 January
Paul Krugman: A Bad Heir Day at the Fed
No, Kevin Warsh isn’t qualified
(Substack) The silver lining to his appointment is that he shouldn’t be able to do much damage, although with one big caveat (see below). The Fed is a republic, not a dictatorship; key decisions are made by a committee in which the chairperson has only one vote. Fed chairs can only drive policy through persuasion — and Warsh lacks the intellectual and moral credibility to be effective on that score. But God help us if we enter a crisis that requires decisive Fed leadership, the kind Fed chair Ben Bernanke showed during the financial crisis, or Jay Powell is now showing against Trump’s attacks.
Absent a crisis, my prediction is that the majority of Warsh’s colleagues will largely ignore him, albeit without expressing their contempt openly. Even a coalition among the Trump appointees to the Board of Governors – Warsh, Bowman and Miran – won’t be enough to overturn the responsible monetary policy stewardship of the other governors.
Trump’s Fed-Chair Pick Is an Interest-Rate Hawk—Or Is He?
Kevin Warsh’s views on monetary policy may be shaped less by real economic conditions than by whether a Democrat or Republican is in power.
By Rogé Karma
( The Atlantic) Trump has not been shy about what he wants in a Fed chair: someone who will lower interest rates. He has constantly attacked current Fed Chair Jerome Powell for not slashing rates fast enough, to the point of launching an obviously spurious criminal investigation into him. Powell has stood firm, but his term as chair expires in May. This gives Trump the chance to install someone who will do what he wants.
… And now the president has instead nominated Warsh, to much applause from the economics establishment.
… The reason for relief is twofold. First, Warsh’s résumé is conventional. He spent his early career on Wall Street and served as a top economic adviser to George W. Bush before becoming, at the age of 35, the youngest-ever appointee to the Federal Reserve Board of Governors, the body that votes on interest rates. When the financial crisis hit two years later, Warsh acted as the central bank’s liaison to Wall Street, helping engineer bank bailouts.
Second, Warsh is seen as an inflation hawk who will err on the side of higher, not lower, interest rates. During the 2010s, he became known within Wall Street and Washington circles as one of the fiercest critics of the Fed’s zero-interest-rate policy, to the point of warning about inflation when unemployment was still at 10 percent. “He’s a pretty stone-cold hard-money guy,” Jared Bernstein, who served as the chair of Joe Biden’s Council of Economic Advisers, told me. “It’s a peculiar choice for Trump, because the Fed that Warsh wants is very different from the one Trump wants.”
The case against Warsh is this: What he wants seems to change depending on which party controls the White House. Warsh was a staunch inflation hawk during the Obama administration. Then Trump was elected, and he seemed to soften

13 January
The Economic Toll of Trump’s Policies Will Soon Be Visible
Mainstream economists have underestimated the cost of all the confusion the administration has unleashed, particularly on trade and immigration.
(Bloomberg) Many forecasters and investors misinterpret what is happening in the American economy. Some believe the uncertainty around President Donald Trump’s trade and other economic policies is abating, while a loud and influential minority argue that the administration’s deportations and tariffs are not causing the predicted harm. Inflation increased only modestly before coming down in 2025, they point out, while the latest data show the economy growing at its fastest rate in two years.
These mistaken assessments are based on a fundamental misunderstanding of how government-induced uncertainty affects the economy. This confusion makes sense because no presidential administration has imposed this kind of uncertainty on the US private sector in a century or more. The economy’s solid growth due to artificial intelligence investment further muddies recognition of these unfamiliar harms. Careful analysis, however, shows the stagflationary effects of Trump’s policies are kicking in and should become too evident to miss as we approach April 2, the first anniversary of his so-called Liberation Day.
The Candor of Jerome Powell
After months of stoicism, the Fed chair is taking a stand against Trump.
By Will Gottsegen
(The Atlantic) … In a video statement, he responded to the threat of indictment with remarkable clarity. “This unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure,” he said. “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.”
Statement from Federal Reserve Chair Jerome H. Powell
Why Powell Isn’t Flinching At Trump’s Attack
If markets really think the Fed is going to base policy on the president’s whims rather than what’s best for the economy, it could cause a financial bloodbath.
(Politico) Sunday and Monday were two of the wildest days of President Donald Trump’s long crusade against Federal Reserve Chair Jerome Powell, second only, perhaps, to the first time he made clear he wanted to fire him back in December 2018.
Seven years later, it’s remarkable how much has changed. The Fed chief, who has doggedly avoided engaging with Trump amid an endless string of criticisms, finally reached his limit. On Sunday night, he directly accused the president of wielding a criminal investigation as part of his pressure campaign for lower interest rates.
… This raises the stakes in the Cook case
The Supreme Court is set to hear oral arguments on Jan. 21 on Trump’s bid to fire Fed board member Lisa Cook, based on allegations that she committed mortgage fraud — claims she has contested. Part of the reason why it was hard to gauge the consequences of the DOJ probe is that we don’t yet know the conclusion of that case.
If the justices rule that the president has a significant amount of latitude in firing Fed officials “for cause,” a statutory standard that has never before been litigated, it could spark a market reaction because investors aren’t expecting a blow to Fed independence.
The notion that Powell’s job might also be on the line could amplify that effect.
On the question of what comes next, the ball is in the judiciary’s court.
Thomas Friedman: Trump’s Scheming to Sack Powell Paves the Road to Constitutional Ruin</strong>
if the Justice Department can be leveraged to destroy the sacrosanct independence of the Federal Reserve, then Trump will be completely unbound, and we are heading for economic trouble and constitutional ruin.

7 January
Trump Is About to Lose Control of the Economy
By Jason Furman, a contributing Opinion writer, was the chairman of the White House Council of Economic Advisers from 2013 to 2017.
(NYT) Remember 2025, when President Trump dictated bracing new rules for the economy? Impose sweeping tariffs! Dismantle government agencies! Lower taxes! Cut spending! The Federal Reserve remained independent, but almost everyone else fell in line.
That may soon feel like ancient history, because in the first couple of months of this new year, the power shifts. The Supreme Court is expected to rule on both the Trump administration’s huge slew of tariffs and the president’s ability to control the Federal Reserve Board. In addition, a new nominee to lead the Fed will be handed over to the Senate for scrutiny. Meanwhile, Congress no longer seems to be listening to Mr. Trump on taxes and spending — and might even start enacting its own agenda.
These developments, affecting cornerstones of Mr. Trump’s domestic agenda, will have a large impact on what our economy looks like and how it works. But in a sharp contrast to last year’s rule by fiat, none of the expected changes in these extremely consequential arenas are in the president’s control. At a minimum, these events may thwart his efforts to further impose his will. At a maximum, they will begin undoing the changes he’s made so far. Either way, we’re likely to end up well past peak Trump.
The tariff decision may be the first of these seismic events. In November the Supreme Court heard arguments about the limits of the International Emergency Economic Powers Act, the basis of a majority of the tariffs introduced last year (including the so-called reciprocal tariffs of at least 10 percent imposed on almost all U.S. trading partners).

2025

17 December
Trump Delivers Attacks and Deflects Blame for Americans’ Economic Worries
The president gave a televised speech that featured repeated rants against Democrats and his predecessor, Joseph R. Biden Jr., along with boasts about gains that many Americans have said they are not experiencing.
(NYT) President Trump delivered a 18-minute prime time speech to the nation Wednesday evening, arguing that the economy under his leadership is in better shape than many Americans believe.
The president has been on the defensive recently over the issue of affordability, which congressional Democrats hope to use to sweep back into power during the midterm elections, capitalizing on voters’ concerns with the high cost of living in America. Wielding charts and figures, some of them misleading, Mr. Trump tried to make the case that the economy is improving or, at least, that the bad parts of it are not his fault.

15 December
Again: Beware These Two Oligarchic Bubbles
They may already be bursting
Robert Reich
I want to repeat a warning I issued a few weeks ago about both AI and crypto.
The question I asked was: What happens when huge amounts of money pour into a poorly understood and unregulated industry that promises spectacular profits for a few winners?
Answer: Many investors lose their shirts while the lucky ones make fortunes. At worst, the bubble bursts and takes the entire economy down with it.
AI is worrisome enough as is — its insatiable thirst for energy and water, its capacities to override the wishes of human beings, its potential to destroy the planet.
The immediate concern is that AI is becoming a financial bubble whose bursting will harm lots of innocent people including, perhaps, you.
Frankly, I don’t care which giant corporations or ultra-wealthy investors strike it big and which lose their shirts.
I worry about the economy as a whole — about working families who could lose their jobs and savings. The losses when the AI bubble bursts will ricochet across America.
Trump has put David Sacks, co-founder of an AI company and, of course, a fierce Trump loyalist, in charge of AI and cryptocurrencies. So far, Sacks has killed any restrictions and regulations that might stand in the way of either.
… Crypto is my second bubble concern. It’s a classic Ponzi scheme. It’s growing because investors believe other investors will keep buying it. And like AI, crypto’s meteoric growth has also been powered largely by the ultra-wealthy. …
When will the crypto bubble burst? Maybe it’s already started.
Crypto tokens have lost more than $1 trillion in market value since their October peak, according to Deutsche Bank. This has generated fears that the rest of the crypto bubble will burst.
The recent sharp downturn in crypto values has exposed the huge amount of borrowing behind crypto’s nine-month rally, which began after the election of an administration seen as friendly to the industry.

8 December
US economy to ‘muddle through’ early 2026, forecast finds
The US economy is expected to soften in the first quarter of 2026 before strengthening later in the year, according to the University of California Los Angeles Anderson Forecast.
The December forecast describes a tale of two economies for the US and California, with opposing forces shaping the outlook. On one side, investment in artificial intelligence infrastructure and rising income among high-wealth households drive the economy. On the other hand, tariff-induced inflation, policy-driven uncertainty and a gradually weakening labor market indicate signs of sectoral weakness.
UCLA reported that projected AI-related investment for 2025 — originally estimated at $250 billion — has already surpassed $405 billion, with further increases expected in 2026. Fiscal stimulus from the Trump administration’s One Big Beautiful Bill Act is also expected to reinforce spending.
The forecast projects GDP growth to slow through late 2025 and early 2026, exacerbated by temporary effects from the 43-day federal government shutdown. Growth is then projected to rebound meaningfully as fiscal and monetary support filters through.

Trump says $12 billion bailout plan for farmers will come from tariff revenue
The package includes $11 billion in one-time payments to crop farmers.
“I’m delighted to announce this afternoon that the United States will be taking a small portion of the hundreds of billions of dollars we receive in tariffs. … and we’re going to be giving and providing it to the farmers in economic assistance. And we love our farmers,” the president said.
The package includes $11 billion in one-time payments to crop farmers through a new Department of Agriculture bridge payment program. The remaining funds will then go to other crops not covered by that program.

‘Only so long’ before Trump’s tariff costs hit consumers, businesses warn
Corporate executives are telling investors that prices will rise as soon as January as pre-tariff inventory runs thin and holiday discounts disappear.
The Trump administration is touting record Black Friday shopping as a sign the president’s tariffs haven’t hurt the economy the way some predicted.
Economists and businesses say: Just wait.
… Since reentering the White House in late January, Trump has levied tariffs on nearly all goods the U.S. imports, raising the average tariff rate to about 16.8 percent, the highest since the 1930s. He’s also imposed sector-specific tariffs on key manufacturing materials like steel and aluminum, copper and lumber, hitting everything from home-building supplies to upholstered furniture to aluminum cans at the grocery store.

13 November
A post-shutdown fog will hang over the U.S. economy for months
Key economic data may never be released, making it difficult for policy-makers
(CBC) The longest government shutdown in U.S. history concluded last night, after Congress passed a bill, which was quickly signed into law, to restore government functions and resume normal activity. But one key impact will continue to be felt for months to come.
Throughout the 43-day shutdown, key economic data was not gathered and the release of crucial economic indicators was delayed.
In fact, the White House now says jobs and inflation data for October may never be released because of the shutdown.
“All of that economic data released will be permanently impaired, leaving our policymakers at the Fed, flying blind at a critical period,” said White House press secretary Karoline Leavitt, referring to the Federal Reserve, the U.S. central bank.

12 November
Trumponomics Will End in Tears
Desmond Lachman
(Project Syndicate) From Latin America to Turkey, the kind of economic populism US President Donald Trump is embracing has always led to disaster. Recent market signals suggest that America’s reckoning will arrive sooner rather than later – vindicating the economic-policy orthodoxy that today’s Trumpified Republican Party now repudiates.
US President Donald Trump has suspended trade talks with Canada, and announced an additional 10% tariff on Canadian goods, over an Ontario-funded television ad that used audio of former President Ronald Reagan denouncing tariffs. The episode is telling. Yet again, Trump is pretending to defend the Republican Party’s longstanding economic principles, while pursuing policies that constitute a wholesale rejection of them. …
…perhaps Trump’s most shocking departure from the Republican Party’s economic playbook is his flagrant intervention in markets. The Trump administration’s acquisition of a 10% equity stake in Intel and its shakedown of Nvidia and AMD for a 15% cut of their sales in China look more like socialism than free-market capitalism. Moreover, his introduction of a $100,000 application fee for H-1B visas hampers the tech sector’s access to skilled foreign workers, while his draconian immigration crackdown creates labor shortages in sectors like agriculture and construction. This is not the business-friendly approach the GOP has long championed. From Latin America to Turkey, we have seen that this kind of economic populism always ends in tears. The question is how long it will take for America’s reckoning to arrive. Recent market signals – including a 10% decline in the dollar’s value, a 50% surge in gold prices, and persistently elevated bond yields – suggest that we may not have to wait long. Foreign investors, it seems, are losing faith in American economic exceptionalism, and becoming increasingly concerned that the US might try to inflate its debts away.
7 November
Trump Is Pushing Us Toward a Crash. It Could Be 1929 All Over Again.
By William A. Birdthistle, director of the Division of Investment Management at the U.S. Securities and Exchange Commission from 2021 to 2024
(NYT) President Trump’s Halloween party at Mar-a-Lago, set to the theme of “The Great Gatsby,” re-enacted the decadence of that story’s licentious era: befeathered flappers shimmying in the crowd; gilded and onyx décor; scantily clad women posing in an enormous champagne coupe. The revelatory moment says so much about where we stand today — and what we could be lurching into next.
Published a century ago, F. Scott Fitzgerald’s “The Great Gatsby” captured the culture of an overheated economy on the brink of demise
… Speculative money is once more pouring into risky investment schemes, with staggering sums of money being thrown at artificial intelligence and cryptocurrencies. But rather than heed a century of hard-won lessons, the Trump administration’s financial regulators are embracing dissolute policies to keep the punch flowing.
The financial excesses of 100 years ago teach us how high the costs of negligent oversight of our markets can be. When sentinels sleep, fraudsters flourish; their frenzied celebration of unreal profits pumps froth into the market; ultimately, with panic and pain, bubbles will burst. As stages of that cycle are recurring, we must decide whether to intervene now — or to mop up the mess later.
6 November
Rich Drive Economy as More Americans Struggle
(Bloomberg) … The US economy is becoming a Jenga tower, one economist told Bloomberg, increasingly fueled by the profligate spending of the rich while a growing number of people must choose between car payments and dinner. This dichotomy isn’t new, but recent months are witnessing an even starker divide, one that some experts say makes the economy more susceptible to recession.
The data are sobering: The richest 10% of households are fueling almost half of total US spending thanks in part to the aforementioned stock market frenzy. Meanwhile, lower-income and middle class families are pulling back in the face of tight budgets, higher costs of living and a grim, rising tide of mass firings.

5 November
Longest Shutdown in History Costs US Economy About $15 Billion Each Week
Past shutdowns have left only temporary scars, but this time is different
By Jarrell Dillard and Josyana Joshua
(Bloomberg) The US government shutdown has become the longest in history, and with no sign of a resolution soon its economic toll is deepening.
… Every week that passes costs the economy anywhere from $10 billion to $30 billion, based on analysts’ estimates, with several landing in the $15 billion range.

15-18 September
Trump administration asks Supreme Court to allow for firing of Fed governor
(SCOTUS blog) The Trump administration on Thursday asked the Supreme Court to pause a ruling by a federal judge in Washington, D.C., that keeps Lisa Cook, a member of the Federal Reserve’s Board of Governors, in office despite President Donald Trump’s attempt to fire her in the wake of allegations that she committed mortgage fraud before joining the board. (Cook has denied the allegations, and several news outlets have since reported on financial documents that may undermine the government’s contentions.) U.S. Solicitor General D. John Sauer, the government’s top lawyer before the court, told the justices that the ruling by U.S. District Judge Jia Cobb was “yet another case of improper judicial interference with the President’s removal authority—here, interference with the President’s authority to remove members of the Federal Reserve Board of Governors for cause.”
The Trump administration’s request came just one day after the Federal Reserve’s two-day September policy meeting, at which the Fed lowered interest rates by a quarter of a point, the first cut since December 2024. Trump has criticized the chair of the Fed, Jerome Powell, for not lowering interest rates. Cook participated in the meeting and joined 10 other governors in voting for the rate cut; Stephen Miran, who was recently appointed to the board by Trump, would have imposed a larger cut.
The Supreme Court is about to decide one of the biggest economic policy cases ever
Cook v. Trump is one of the highest-stakes cases of Trump’s presidency.
(Vox) A long-simmering showdown over whether President Donald Trump may seize control over the Federal Reserve appears to be entering its endgame. It is highly likely that the Supreme Court will weigh in on this dispute either Monday evening or Tuesday.
If the Court does side with Trump, that would be one of the most consequential economic policy decisions in the federal judiciary’s history. And it could potentially have disastrous consequences both for investors and for the US economy broadly.
… The Fed essentially has the power to inject cocaine into the US economy. When the Fed lowers interest rates, it makes it easier for businesses to borrow money that they can use to begin new projects and hire new workers. But it also risks spiking inflation rates. Thus, if the president controls the Fed, he can engineer a short-term, politically advantageous boost to the economy — but at the cost of much greater economic turmoil down the road.
… In any event, a lawsuit known as Cook v. Trump is now barreling toward the Supreme Court, and is likely to land on the justices’ doorstep as soon as Monday night. Trump has asked the courts to weigh in on this case on an exceedingly expedited basis, in the hopes that he can gain the power to fire Federal Reserve governors in advance of an important Fed meeting that begins Tuesday.

17 September
The Trump Fantasy Is Unraveling
Jamelle Bouie
The essence of President Trump’s pitch to the American people last year was simple: They could have it both ways.
(NYT) In reality, this was a fantasy. Americans could have a strong, growing economy, which requires immigration to bring in new people and fill demand for labor, or they could finance a deportation force and close the border to everyone but a small, select few. It was a binary choice. Theirs could be an open society or a closed one, but there was no way to get the benefits of the former with the methods of the latter.
Now, about eight months into Trump’s second term, the reality of the situation is inescapable. As promised, Trump began a campaign of mass deportation. Our cities are crawling with masked federal agents, snatching anyone who looks “illegal” to them — a bit of racial profiling that has, for now, been sanctioned by the Supreme Court. The jobs, however, haven’t arrived. There are fewer manufacturing jobs than there were in 2024, thanks in part to the president’s tariffs and, well, his immigration policies.
We got a vivid glimpse of what it looks like for harsh immigration policies to undermine growth and investment earlier this month, in Georgia, when immigration officials detained hundreds of South Korean nationals working at a battery plant in a small town outside Savannah.
The consequences of this raid go beyond the trauma inflicted on the workers. The South Korean public is furious, not the least because this raid came just weeks after the country’s government promised to pour billions of dollars into new investments in the United States. “If U.S. authorities detain hundreds of Koreans in this manner, almost like a military operation, how can South Korean companies investing in the U.S. continue to invest properly in the future?” Cho Jeongsik, a lawmaker from the liberal governing Democratic Party, asked.

10 September
Trump’s Economic Agenda Hinges on the Supreme Court’s Tariff Ruling
For the president, the power to issue limitless tariffs is at the heart of his second-term vision, from trade to foreign policy.
(NYT) When President Trump unveiled his initial slate of punishing tariffs in April, he fashioned the announcement as a critical moment in a dawning global trade war, describing it as “the day America’s destiny was reclaimed.”
Five months later, his gambit could be in peril, after the Supreme Court agreed on Tuesday to hear a case challenging the legality of Mr. Trump’s actions. Now his administration is confronting the potential loss of a powerful tool at the heart of his second-term strategy, one that has allowed the president to force concessions from companies, allies and adversaries.
The case itself concerns Mr. Trump’s novel use of a decades-old economic emergency law to impose duties around the world, despite the fact that the statute does not explicitly allow for the president to tax imports.