In Trump's interview with Sean Hannity yesterday, Trump suggested that a rise in the stock market was reducing the national debt:
Video in spoiler below.The country — we took it over and owed over $20 trillion. As you know, the last eight years, [the federal government] borrowed more than it did in the whole history of our country.
So they borrowed more than $10 trillion, right? And yet we picked up $5.2 trillion just in the stock market. Possibly picked up the whole thing in terms of the first nine months, in terms of value.
So you could say, in one sense, we're really increasing values. And maybe in a sense we're reducing debt.
Even ignoring the fact that the stock market is merely continuing its trajectory/recovery from 2009, this displays a shocking ignorance as to how the country which he is President of works.
The stock market measures the value of private companies, whereas the public debt is a measure of the money the USG owes (typically to other countries, but also to domestic agents and the federal reserve). There is no obvious correlation between the two; indeed, under President Obama, between 2009-2017 the S&P 500 increased by 235% whilst the national debt increased by $9 trillion (source).
The debt is affected by whether there is a budget deficit/surplus (i.e. whether the government's income - through taxes and exports - offsets its expenditure). The current public-held national debt of the US is $14.6 trillion, and that is expected to increase to $25 trillion within a decade. The USG is projected to run a deficit of approx $700 billion in 2017 (source).
Ironically, Trump's proposed tax plans would add (at the very least) an additional $2.2 trillion to the debt (source).
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Donald Trump's Economic Illiteracy watch
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Last edited by Palmyra; 12-10-2017 at 14:43.
- 12-10-2017 14:41
- 28-10-2017 15:29
And here is a pretty decent rebuttalLast edited by Doonesbury; 28-10-2017 at 21:07.
- 28-10-2017 16:34
Imagine how crap you'd have to be to lose to Donald Trump
- 28-10-2017 21:00
Might have been talking about extra tax from the profits? I don’t know.