The White House is in a complete crisis, as Treasury Secretary Scott Payette said on Sunday that the United States was on the verge of financial collapse thanks to reckless government spending over the past few years. Now, the administration is scrambling to fix it.
“What I can guarantee is that we will get a financial crisis. I studied it, I taught it, and if we have continued these spending levels – everything was not sustainable.” Meet. “We are reseting, and we put things on a sustainable path.”
Trump cuts government spending
President Donald Trump made the costs of reducing a top priority. The Ministry of Governmental efficiency, led by Elon Musk, has launched fat trim through many federal agencies. the goal? Less number of jobs, more early retirement, and low government spending.
But despite these efforts, the numbers tell a different story. The US budget deficit approved for the month of February alone $ 1 trillion, which increased the debt. Even Bessent is not considered a smooth recovery. “No guarantees” will not strike the country, as it admitted.
Wall Street does not take this lightly. The markets were ready as Trump’s aggressive policies raised fears of inflation and economic slowdown. The S&P 500 decreased in a 10 % correction of its highest level in February, which led to fluctuations across the ceiling.
Bessent does not seem worried. “I have been in investment for 35 years, and I can tell you that the corrections are healthy. They are normal,” He said. “What is unhealthy is straight, and to get these euphoria markets. This is how you get a financial crisis. It was better that someone had put the brakes in ’06, ’07. We didn’t face problems in 2008.”
Bessent supports Trump’s economic agenda
Scott Pesin not only took the cabinet to keep things calm. It has become one of the highest votes that drive Trump Maga 2.0 economic policies. His position? The short -term market pain deserves it for long -term economic control.
BESSENT, the former hedge fund manager, does not follow the playing book in Wall Street. It adopts Trump’s protective policies and calls on the United States to “get rid of toxins” from government spending. He recently raised the eyebrows when he said: “Access to cheap goods is not the essence of the American dream.” He also rejected fears of customs tariffs, saying he was “less anxious” about short -term effects.
“It is certain that he has not yet played the role that the markets have expected,” said Sarah Bianchi, the first administrative director of Evercore ISI. Anxiety is that no one in the administration remains ready to back down from Trump’s aggressive economic moves.
Under the first period of Trump, officials, such as former Treasury Secretary Stephen Mnuchin and other economic advisers, were handrails, preventing severe policies from enhancing chaos. These restrictions are now. “No matter how the guards bars were in place, the first administration is no longer present,” said a former Trump official.
Bessent’s document relations with George Soros and the lack of republican political experience in Wall Street were expecting to take a more traditional approach in the free market. Instead, he completely aligned himself with Trump’s first American strategy, especially when it comes to trade.
“Scott is well aware that there are some dangerous economic costs to raise the definitions significantly,” said Jeans Nordvig, the founder of EXANTE DATA. But this does not mean that he resists them. Unlike Mnuchin, who fought against Trump’s most extreme ideas, Bess’s seems to communicate with it.
Market fears grow with recession risk
The second -term Trump’s economic agenda makes waves, especially in global trade. Early decisions struck China, Canada and Mexico, causing a ripple effect on the market. Trade Secretary Howard Lootnik and American Trade Representative, Jameson Jarir, is being charged with new commercial battles, leaving Pesin to move in some difficult internal policy.
The Treasury and Lutnick Minister is not exactly the best friends. Both wanted the locker function, and the tensions between them are well known. A person familiar with the situation said, “He must be careful so that Nancy is not negative,” he compared his relationship to “fighting a Brazilian knife with the lights.”
Despite fears, the White House insists that Bessent is behind Trump’s entire vision. A Treasury spokesman made a statement saying that he “works tirelessly to the age of this state on behalf of the President, and ensuring that Main Street and Wall Street reap the benefits of President Trump’s winning economic agenda.”
But Bessent itself knows that the transition will not be painful. He recently admitted that avoiding public spending to private spending would take time. “There will be a natural amendment,” he said.
50 percent of working Americans have been killed. “We are trying to treat it,” CNBC told CNBC. When asked if the economy inherited by Trump began weakening, he did not deny it. “Can we see that this economy that we inherited started to roll a little? Certainly.”
Wall Street is still waiting for its purification, but the Bessent message has remained the same: the long -term economic power requires the short term.
“It is very clear to people now that this is not a person who simply directs the voice of the markets. Josh Lipski, chief manager at the Atlantic Geological Economy Center, said this is the person who has a completely different view of the world.
The transformation of Trump’s economic strategy worries some economists from stagnation or frank stagnation. Executive managers surveyed by the business table for business increased employment and investment plans. David Solomon, CEO of Goldman Sachs, said the uncertainty in politics slows down the deals and keeps investors hesitant.
On the other hand, Bessent sees some silver bars. He pointed to a recent decrease in the costs of borrowing in the long term and reducing gas prices as evidence that the management strategy is working. But at the same time, he admitted that the United States is subject to a basic transformation, and this will harm before it helps it.
“There is no doubt that Trump had a great impact on his thinking on the economy,” said Stephen Moore, former Trump advisor. Moore noted that Bessent was able to avoid entering Trump’s fingers in the emergence of the media, a skill that has failed by many former economic officials in Trump.
Regarding politics, Moore said that Bessant “has become more tramp about how he thinks about how these policies affect America with blue and middle classes.”
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