"The Mouth" goes to Davos

Today, of all things, we were treated to seeing Anthony" the mouth" Scaramucci being interviewed in Davos. Is he back on Trump's team or is he on his own dime? Who knows. He actually had something interesting to say but more about that later. Meanwhile Trump's you should excuse the expression" Brain trust" is also there. I'm talking about the estimable Wilbur Ross, Gary Cohn and of course Steve Mnuchin. Mnuchin was applauding the weakening of the dollar, and hoping it continued, because it would have a positive effect on US exports. You may recall that during the campaign Trump's economic guru Peter Navarro had convinced the Donald that all of the US economic problems, real and mostly imagined, would disappear if we eliminated trade deficits with China. In those days Trump was railing against the Chinese government devaluing it's currency, apparently not realizing that I had ended a few years ago. Now the munchkin is apparently advocating US do something similar. This will probably be known as the Chinese gambit period. Apparently Mnuchin did not consider the effect of a declining dollar on the role of the US primary reserve currency and the effect on rates demanded in future treasury auctions.

Trump is apparently going to give a speech Friday promoting his America First economic program. He has just placed  tarifs on large washing machines and solar panels. There is an interesting article in the January 23 new York Times pointing out this is likely to cause a loss of jobs in the United States whereas Donnie will doubtless claim he is creating them. If our fearless leader explains his economic theories in his usual fashion it would be nice if people such as Christine Lagarde or Mario Draghi would take the podium to gently but insistingly  rebuke him. Probably won't happen in public but the private conversations wouldn't be interesting to say the least.

Meanwhile, back to" the mouth". For the first time in my hearing at least someone aligned with Donnie talked about the virtue of increasing aggregate demand and thus energizing the virtuous cycle in this country and how it would be beneficial to not only the US but the world in general. Holy smokes, has he been talking to real economists in Davos? Of course he did not explain the mechanism to increase aggregate demand. He did not, for instance say that aggregate demand suffers because of the inequality of income and wealth in this country and that the best way to cure this is to give  tax cuts and benefits to segments of the population with high marginal consumption rates instead of giving tax cuts to corporations and people who have more money than they know what to do with. Maybe someone there will explain that to him.

Like everyone I suppose, I can't wait to hear the speech from our man in the White House. And of course I can't wait to hear his own critique of his performance although it is somewhat predictable.