Behind Closed Doors: Greenspan on Trump’s Tax Plan

25.01.2017 • Emerging Markets

By Ivan Carrino – Inteligencia Estratégica (Argentina) –

Dear Reader,

The Trump Presidency hit the ground running. In Argentina, we woke up to the news that the US Department of Agriculture issued a 60 day suspension of lemon imports from Argentina. The lemon producer San Miguel (SAMI) took a big hit – shares are down 8%.

What’s more, the populist leader decreed today that the US will withdraw from the Trans-Pacific Partnership, the free trade agreement celebrated by the US, Australia, Japan, and Chile among others.

So far so bad.

Surely we will see an upside to all of this. After all, Trump promised that he was going to lower taxes and deregulate the economy. But it doesn’t look like that’s what’s going to happen after all. At least not according to what Alan Greenspan had to say in our private briefing with Bill Bonner and other prominent international financial analysts.

When I asked him about the possibility that Trump would lower taxes, Greenspan said:

“It’s not going to happen that way. Can you imagine what they’re going to see in February when they start looking at the budget numbers? The issue isn’t going to be ‘do you have a big tax cut,’ but ‘do you have a big tax increase.’ I don’t see them lowering taxes. I think the real danger here is the fact that we’ve allowed this issue of a huge amount of entitlements to rise as we age and to keep adding to them.”

 

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