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Unknown A
All right, I'm starting to get the emails, the emails that I got during Trump's first term, which say, David, you seem like you're rooting against the American economy. You're rooting for a collapse, you're rooting for a recession or a depression to prove some political point. And of course to that I say thank, you're lucky stars every day. You're not Dave Paman. That's right. You wouldn't want to be on the receiving end of these emails. It's much the opposite. Okay. I am not alone in being concerned about what we're seeing in the economy, but I made it very clear. I'm always rooting for the country. I'm always rooting for those who live here. I'm rooting in favor of the economy. I made this clear when Trump was inaugurated. I said, I hope he succeeds in the sense of helping the country. I'm skeptical, but I hope he does.
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Unknown A
And many people wrote to me and they said, david, why would you hope for that? I hope for that because I don't want to see suffering. I don't want to see unnecessary economic problems. But I am concerned. And you know what? I'm not alone. We have now seen the sharpest decline in American consumer confidence during this month that we have seen in four years. In four years, we have never seen a larger single month decline in consumer confidence than we saw right now under Trump. The conference Boards consumer Confnce consumer confidence index fell to 98 from 105. 98 from 105. The expectation was there would be a modest drop to 102. Consumer confidence has dropped to 98. This brings the index to its lowest level of consumer confidence since 2022. The sub index declines also are reflecting concern. Uh, the index that reflects market and business conditions went down to 136from139.
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Unknown A
The Expectations Index, which measures the short term outlook for income and economic conditions went from 82 to 72. These are relative indicators. Right? What we care, what we care about is the proportional drop. And we are also seeing rising inflation expectations. So the 12 month inflation expectation is up from 5.2 to 6%. Now you might say, I thought inflation was 3%. Yes, this is an expectations index. Where do consumers expect inflation to be a year from now? And consumers expect it to be at 6%. They see exs out of control, they see growthoceries out of control. And people are very worried about the Trump policy, tariff policy. And there are serious reasons to consider that this is going to negatively affect the economy. So this raises concerns about a consumer slowdown and economic slowdown, a reduction in economic growth, the inability of people to afford things.
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Unknown A
We already have a situation where almost half the country can't meet an unexpected $400 expense without going into debt, meaning putting it on a credit card or borrowing or taking out a loan. This can become a self fulfilling prophecy. And so one of the things we're going to be following extremely closely, we started it earlier this week as we were one month into the Trump presidency. Where does unemployment go? Where does inflation go? Where does what do GDP numbers start looking like once we get them for the Q of Q4 of 24 and Q1 of 25, how closely does the concern that consumers clearly have right now manifest in the economic data? It remains unclear the direction of this economy and one of the things that I've said before, and I will say again, is that the economy was pretty good before COVID under Trump.
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Unknown A
I don't say that it's because of Trump, but when you stay out of here's the reality, okay. The American economy does not work for a lot of people. We have poverty, we have hunger, we have lack of access to health care. There is no question that it is not a perfect economy. But one of the things that is true is that when you sort of stay out of the economy's way, meaning you don't under regulate and you don't over regulate, you don't dump in politically motivated tariffs, you don't make empty belligerent threats just to see what happens. When you kind of stay out of the way and don't do anything too nuts, the economy is dynamic and diverse enough that it tends to do pretty well tracking global business cycles. When you get in the way, whether it's Covid getting in the way, whether it's a failed Covid response getting in the way, whether it's unnecessary tariffs, whatever the case may be, that's when the economy doesn't do well.
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Unknown A
So it's conceivable that Donald Trump could have a pretty OK economy not by virtue of what he does, but by virtue of what he doesn't do. If he stops the tariff talk, if he doesn't look to put in deficit raising tax cuts for the rich in corporations, if he just kind of behaves like a normal person and says let's let the American economy do what it can do, it would likely be okay, or at least as okay as any other western developed country's economy. What he is threatening to do has very much the possibility of sending creating an inflection point and sending the economy into a tailspin. So for those writing in going David, you seem so eager to see the economy collapse. No, no, no, no. I am not eager at all. I'm concerned and I'm concerned especially because of folks that don't have the sort of the safety net of what some of the blue states provide.
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Unknown A
And this is it's Trump voters in red states, but it's also non Trump voters in red states who are going to suffer all the same. So that's the data we have now. Consumer confidence at its lowest point in four years, biggest drop in four years. We will see what the next month brings. Well, I wrote a book. After a long journey and a ton of work, I am really thrilled with how it turned out and I hope you'll read it. The book is called the Echo Machine and in a nutshell, it looks at how American politics got so broken, who has already figured out solutions and how we can try to fix it and stop the terror of Trump for the next four years. With Trump winning this election, the Echo Machine couldn't be more relevant. Not only a warning about how we got here, but also about what might be coming and how to prevent the worst outcomes.
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Unknown A
We've got to stay engaged. We need a plan. And that's what the book is about. There's a belief out there that unless you have corporate media behind you, you can't have a successful political book launch, that it's not possible. I think we can prove that wrong. Order the Echo machine today@davidpakkman.com Echo on Amazon, Barnes and Noble, Audible, Kindle, anywhere that books, ebooks and audiobooks are sold. You can also call any local bookstore and say, please order me the Echo Machine by David Packman. Wherever you get the book, you'll get the free pre order perks, including the signed bookplate. Head to davidpakkman.com freebookstuff after ordering.