Biden pointed out that economic forecasters have raised the US GDP growth forecast to more than 6%, which is proof that the rescue plan has worked and the fight against the epidemic has made progress. “We are beginning to see new signs of hope in the economy,” he said. “Hope is here.”
Earlier this month, the US Congress passed Biden’s $1.9 trillion fiscal stimulus plan to help the economy recover. Currently, Biden and his economic team are drafting a new US$3 trillion long-term investment plan, focusing on infrastructure, education, and nursing. Part of the funding will come from tax increases.
“I want to change the existing paradigm, not only wealth can be rewarded, but work can also be rewarded,” Biden said at a press conference. (Interface News)
This is the same as saying that India has grown by 9.2% this year. It belongs to people who are confident, and you really can’t say anything. . . To make it clear, subjectively I believe in the theory of the collapse of the dollar, that is, the dollar will completely lose its credibility and lose its value in international circulation during this economic crisis or the next economic crisis within 20 years. Therefore, my judgment will tend to describe the bad side of the US economy, and readers are invited to adjust their perceptions as appropriate. In early March, the OECD raised the US GDP growth forecast for 2021 from 3.2% to 6.5% because of Biden’s 1.9 trillion stimulus package. Now that Biden is going to come to 2 trillion (at least), does it mean that the United States will hit double-digit growth in 2021? This. . . Dare to love the epidemic killed 550,000 people, the economy has not shrunk, but has expanded rapidly. Yes, very energetic. On the other hand, the labor participation rate in the United States dropped from 63.4% in the first quarter of 2020 to 61.4%. At present (the first quarter of 2021) there are still 9.7 million unemployed, of which long-term unemployment (more than half a year) accounts for 43.4%. This means that more than 4 million people in the United States are structurally unemployed. The proportion of long-term unemployed in the United States to total unemployed. Moreover, as expected, the most unemployed in the low-end service industry is also the most difficult to recover. From March 2020 to March 2021, the number of employees in various industries in the United States has changed, but the construction industry has basically recovered. Biden urged infrastructure construction to send his former cashier girl and housekeeping aunt to the construction site? Oh, yes, most of the money printed before went to the stock market. The total market value of the US stock market has grown from 159% times GDP before the epidemic to 194% times GDP. Calculated at 22 trillion U.S. dollars, that is to say, since the epidemic, the total price of US stocks has increased by 7.8 trillion U.S. dollars. Gee. If you have the ability to stimulate the economy, the capital market has the ability to eat it all. As we all know, money in the capital market is not considered GDP. Well, if Biden’s economic growth plan is only economic stimulus and infrastructure, it is basically difficult to achieve a nominal 3% growth, which means that it is basically impossible to achieve it in 2021 before the epidemic is restored. According to past data, such a large-scale structural unemployment will last for at least four years. Therefore, it is difficult for the United States to achieve growth of more than 3% in 2021. Even because of the huge ability of the capital market to absorb money, the Fed cannot even print CPI. Anticipation of deflation and depression should be the consensus of American elites. Anyway, I think that if the stock market does not fall back, or employment is not solved first, to find new growth points, raising interest rates is tantamount to a deflationary future. The United States boasts that it is the most developed country in the world, and new growth points are really not available. This wave should depend on who is behind the economic collapse. The Fed raises interest rates, economic growth cannot keep up, deflation, that is the Fed/Biden’s pot; the Fed does not raise interest rates, the stock market bubble is too large, Wall Street began to sell on a large scale, the bubble bursts, the economy is depressed, that is Wall Street’s pot. The last time Wall Street did something wrong, it greatly affected the image and overseas credit. It is estimated that a lot of money is not easy to make. Also, in the past, capital + media was equal to votes. Trump came to power and populism was rampant. The previous set would not work. If Biden carries the pot that caused the depression, the mainstream media will not be able to wash it again. The Democratic Party estimates that it will be a while. I can’t hold my head up, so I think this wave of American elites understands that the American economy is too hard to return to the gods and it is difficult to save. It is just a matter of how the pot is divided. Therefore, a wave of people clamored to ask the Fed to raise interest rates, and a wave of people said they were determined not to increase it. What’s more interesting is the question of whether to put this pot on China’s head. Not bad, I don’t want to take the pot internally. I want to rely on it, China and the United States have decoupled, and the economy has exploded in place. It is actually difficult for proud Americans to completely believe that their economy has been blown up because of a struggle with a third world country. The elite will not believe it, after all, the logic of this statement itself is not strong enough. Therefore, there is such nonsense as “cooperating in the field of cooperation and fighting in the field of struggle”. Counseling can’t work. Teacher Jin Canrong is right. The United States has lost its confidence and calmness as the world’s hegemon, neither can it be joking, nor does it have a domineering attitude that cannot be offended. Economic growth of 6% in 2021? Just increase laughter. A child asked me, even if the accumulation is hard to come back, the US economy is just waiting for a breakthrough, why must it shrink? This question is very interesting! Make a supplement here. The U.S. economy is different from other countries. The U.S. dollar is the most important international currency and needs to provide currency support for the international trade market. Other countries can’t find growth points, just wait for a breakthrough in sideways shocks, such as Europe. The U.S. needs to continue to export U.S. dollars to maintain the U.S. dollar exchange rate. International trade volume must continue to rise and increase faster and faster. U.S. dollar exports must also continue to rise and climb faster. Otherwise, the supply of U.S. dollars will continue to rise, and the United States itself The export of goods will lose competitiveness. The export dollar is based on imported goods. If the economy stays in place and imports continue to increase, it actually means that the domestic market is constantly being eaten up and related industries in the country are shrinking. Therefore, the economic development of the United States must be equal to or higher than the international average. However, as an advanced economy, the United States is destined to not grow as fast as emerging economies. When emerging economies are lifted out of poverty, their huge population base will make their total amount large enough to affect the balance of supply and demand for the dollar. As a result, if the United States stops technological breakthroughs and stops development, either the dollar will continue to appreciate or all US industries will continue to shrink. This is why I firmly oppose the internationalization of the RMB. If the renminbi replaces the U.S. dollar, the mentality of our people may also undergo terrible changes, and they may deliberately depress global economic development at certain special moments. Some small partners pointed out that the export of US dollars is not entirely dependent on commodity imports, and there are other multiple means. This is not wrong, I simplified it. And I’m not very familiar with this aspect. If there is something wrong with the following, please point it out. U.S. dollar exports do include overseas investment and cross-border bank expansion. The stock of US direct investment abroad is about 7.7 trillion (the largest in the world), but the output in 2019 is about 160 billion, and the import is about 330 billion. The net flow is to the United States. I dare not talk about the return of the manufacturing industry, but the US dollar has indeed returned, so that the US dollar index has remained at a high point before the epidemic. On the other hand, at the end of 2020 in the United States, as a result of the international investment position (IIP), within one year, the United States’ international debt increased by about 6 trillion and its international assets increased by about 3 trillion. On a net basis, it is still the United States that has borrowed another $3 trillion from the international market to return to the United States. Despite the Fed’s unlimited qe, there is still a shortage of domestic dollar liquidity in the United States, and liquidity needs to be squeezed from the international market. It can be said that at present, the United States has basically been relying on the cross-border investment balance to return the U.S. dollar to ensure the international circulation of the U.S. dollar, so as to achieve the purpose of sucking blood. It is very rare to rely on investment to export U.S. dollar liquidity. As for the expansion of cross-border bank balances (such as foreign exchange swaps and currency swaps), generally speaking, it is more troublesome and often involves politics, and generally one party will lose money at maturity. In this epidemic, in terms of currency swaps, under the coordination of the Federal Reserve, in the first quarter of 2020, Japanese and European banks only withdrew a total of 358 billion U.S. dollars, and then vomited about 60% back in the second quarter. As for foreign exchange swaps, I really don’t know this, so skip it. In terms of international trade, the United States has a deficit of more than 800 billion a year, imports 2.5 trillion yuan, and exports 1.6 trillion yuan. This force should dominate the international dollar supply. To be unprofessional, this 800 billion is roughly equivalent to the attributes of M0 or M1. In general, the dollar’s cycle is basically based on exporting dollars through trade, and recovering dollars through cross-border investment balances and the sale of financial derivatives.