Makes sense to me the DOGE deflationary is a hard fade. Most cost cuts require passing legislation. The Rs have a tiny advantage in the house... they lose 4 votes and they can't do wildly unpopular dumb things. Another dimension of this is that Federal employment costs are tiny at 1% of GDP... and most of those people work at the department of defense, homeland security etc. Why is this group of conventional republicans any different than the ones that failed to cut in the past? If there is one thing we learned from Trump 1.0 is that every person that worked for the man regretted it. Having a side commission on cost cutting is mostly just going to give Trump someone to blame when the deficit isn't cut and the bond market eventually pukes.
On the oil increases I wonder if it will end up mostly being NG and NGLs. At the current curve there is little reason for private sector drilling for oil. Natural gas and NGL exports though... plenty of room to expand that. Permitting and allowing NG to be exported will be a good thing for producers closing some of the global price gap. I think/hope this is one part of the program that actually works. I like NG here.
3% growth is very achievable if they keep doubling crypto prices every year or two. If the imperial palace of Japan could be worth more than all of California at one point, why can't MicroStrategy (MSTR) also do the same? Recent growth rates have a lot of wealth effects baked in. Does that keep going for years? I doubt it.
Makes sense to me the DOGE deflationary is a hard fade. Most cost cuts require passing legislation. The Rs have a tiny advantage in the house... they lose 4 votes and they can't do wildly unpopular dumb things. Another dimension of this is that Federal employment costs are tiny at 1% of GDP... and most of those people work at the department of defense, homeland security etc. Why is this group of conventional republicans any different than the ones that failed to cut in the past? If there is one thing we learned from Trump 1.0 is that every person that worked for the man regretted it. Having a side commission on cost cutting is mostly just going to give Trump someone to blame when the deficit isn't cut and the bond market eventually pukes.
On the oil increases I wonder if it will end up mostly being NG and NGLs. At the current curve there is little reason for private sector drilling for oil. Natural gas and NGL exports though... plenty of room to expand that. Permitting and allowing NG to be exported will be a good thing for producers closing some of the global price gap. I think/hope this is one part of the program that actually works. I like NG here.
3% growth is very achievable if they keep doubling crypto prices every year or two. If the imperial palace of Japan could be worth more than all of California at one point, why can't MicroStrategy (MSTR) also do the same? Recent growth rates have a lot of wealth effects baked in. Does that keep going for years? I doubt it.
Excellent perspective Jason. Thanks for taking the time.