Thread by @wmhuo168

Trump's plan to crash the market and force Fed rate cuts could backfire spectacularly—fueling stagflation, sinking the dollar, and exposing the rot at the heart of the U.S. financial empire

https://x.com/Kanthan2030/status/1908223054716563751?t=qnYtgsfMlfEwEQn2qNuJLQ&s=09

Donald Trump didn’t ask permission from the Fed before launching his beloved tariff war. And that decision could spark a perfect storm of stagflation, dollar devaluation, and financial chaos.

1/24

Trump’s strategy is clear: crash the stock market, slow the economy, and force the Fed to cut interest rates—making it cheaper to refinance $9 trillion in debt this year.

2/24

But the Fed isn’t playing ball anymore. Unlike 2019, it can’t cut rates without fueling the very inflation it’s desperately trying to contain.

3/24

Trump is acting like it's still 2018—low inflation, obedient markets, and a Fed afraid of mean tweets. But we’re in a different era now. One defined by stagflation and geopolitical fracture.

4/24

The U.S. economy is in the early stages of stagflation: high prices, sluggish growth, and a Fed with no good options. Tariffs only make it worse.

5/24

Tariffs are inflationary. They raise input costs, stifle supply chains, and force consumers to eat the difference. And yet Trump is doubling down.

6/24

Meanwhile, the U.S. has to refinance a massive portion of its $34 trillion debt—$9 trillion in 2025 alone. That’s impossible with high rates.

7/24

But if the Fed cuts rates, foreign holders of U.S. Treasuries may dump them en masse. Why hold low-yield debt when inflation is eating your returns?

8/24

China, Japan, and Gulf nations have already started reducing exposure to Treasuries. And after sanctions and asset freezes, trust is gone.

9/24

The dollar is no longer untouchable. BRICS is building alternatives. The euro and yuan are gaining traction. Even U.S. allies are hedging.

10/24

And yet Trump marches in with economic napalm, oblivious or indifferent to the structural fragility of the system he’s inherited.

11/24

The Fed may be independent on paper, but in reality, it answers to the neoliberal cartel: Wall Street, Silicon Valley, and Washington insiders.

12/24

These elites thrive on low rates, inflated assets, and endless debt. But now they’re trapped: cut rates and kill the dollar, or keep them high and implode the debt machine.

13/24

Trump thinks he’s playing 4D chess. In truth, he’s lobbing grenades into a monetary system that’s already on fire.

14/24

Unlike in 2018, the Fed may not blink. Inflation is sticky. Debt is unsustainable. And the market knows the game is up.

15/24

The result? A likely “soft” devaluation of the dollar. A slow-motion decline, not a sudden collapse—yet devastating all the same.

16/24

The Fed may quietly accept a weaker dollar to inflate away debt. Financial repression is coming. Capital controls may follow.

17/24

And the American middle class? They’ll get the usual treatment: higher prices, stagnant wages, and another round of economic gaslighting.

18/24

This isn’t just policy failure. It’s the collapse of an entire economic illusion—one built on debt, hubris, and manufactured consent.

19/24

The neoliberal elites wanted infinite growth from finite systems. Now they’re staring into the abyss, hoping no one notices.

20/24

Trump never asked the Fed before launching his tariffs. And the Fed never asked the public before printing trillions.

21/24

Both are playing a dangerous game—only one is pretending to be in control. The other is naked and shouting at the mirror.

22/24

The American empire isn’t collapsing because of enemies abroad. It’s collapsing because the emperor doesn’t know he’s naked.

23/24

History doesn’t ask permission. It just arrives. And when it does, the price will be paid by those who were told the illusion was real.

24/24