Tariffs

 Krugman has a long, wonky post about why the impact of Trump's tariffs on prices is only about a 1% increase in overall prices. If you want to dig into the weeds of that, be my guest.

Prices rose 2.4% last month (if we believe the government data, which in this case we probably should). Absent tariffs, prices would - presumably - have risen by 1.4%. If I'm right - and I very much might not be - I think that there are two possible impacts of tariffs.

The first is that 2.4% is still on the high side. That makes it unlikely that we will see dramatic interest rate cuts. Inflation is not galloping ahead, but it's not quelled either and people are still upset about prices.

The second is that if prices might hypothetically have only risen by 1.4% without the tariffs, then we might be seeing a slacking in consumer demand. While the economic data are generally positive, consumer sentiment is in the toilet. That might just be the overall unpopularity of Trump. I do believe that people will complain about "the economy" when they are really just unhappy overall. 

The only thing buttressing Trump from hitting the Crazification Factor of 27% approval is that the floor has not fallen out of the economy. My guess is that it was going to happen at some point this year, but maybe it won't. Maybe the US economy is just too resilient to be knocked off course by these corrupt idiots.