(Any views expressed below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.)
Sometimes these letters really do write themselves.
My first impression after watching that was “well, at least he’s taking the direct and honest path to bribing the public.” As we’ve discussed over the last few weeks, the main issue heading into midterms is affordability. It was inevitable that both sides were going to dig deep into their bag of goodies to try and buy votes in what appears to be a very tight race. Can Trump actually hand each American $5k? Not without winning both the House and the Senate. If he can pull off a sweep then he could pass a bill. Senator Bernie Moreno has already come out in full support and said he would prepare the bill if Republicans win.
Look, it doesn’t matter if I think this is completely ridiculous. It obviously is and also kind of feels a bit illegal. However, the goodies the Dems offer up end up costing the country similar sums except they will require a ton of extra steps where special interests and corrupt middlemen take most of the expenditure. At least this way the payments are going directly to citizens just like the Covid stimmys in 2020-2021.
Politicians promising cash payments to citizens for votes is a very dangerous road to go down. Why stop at $5k? Why not $10k next time? Or $20k? Once one side starts doing it, the other side has every incentive to promise more. It’s an incredibly easy escalation ladder. Money printer goes brrr.
I’m finishing this from the Brightline back to Delray after a full day of meetings in Miami and I was tempted to turn this into another long rant about deficits, $40 trillion of debt and financial repression. But you’ve heard enough of that from me lately.
The much simpler point is that 6 years after the government mailed everyone $1,200 cheques during a covid, we’re now casually discussing $5,000 cheques as part of an election campaign.
Maybe they happen. Maybe they don’t.
One of these weeks I promise I’m going to write about something more exciting than deficits, debt and government cheques. I have a whole thesis brewing around why bitcoin may be even more important in a world of AI and abundance.
Until then, own things they can’t print.