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Watching Trump Create Money from Nothing

Watching Trump Create Money from Nothing

    A new CNBC poll shows that optimism in the economy has surged since Trump got elected. That’s how Trump creates money from nothing. Literally.

    The economy runs on optimism. The more you have, the better your economy will be, all other things being equal. And Trump just cranked up the optimism in a way that history has rarely seen. The stock market is up too, as you would expect when you have more optimism.

    Optimistic business owners invest today because they expect tomorrow to be better. That investment creates jobs and stimulates the economy, creating a self-fulfilling path to prosperity. Individual companies can fail and succeed as usual, but the economy as a whole is likely to do well when optimism is high.

    In the ancient world, the big problem was resources, not optimism. You didn’t always have access to raw materials, the right kind of labor, or markets. But in 2016 we can generally find anything we need and move anything to anywhere. The physical element of economics is largely solved. All that matters today is how we think about the economy. That’s the key element.

    President Obama understood psychology and economics too. His cool, rational demeanor was the perfect leadership style to get us out of the 2009 downturn. He didn’t panic, so we didn’t either. And panic was the only thing that could have destroyed the world economy. We had all the resources and intelligence we needed. All we had to get right was the mood. And Obama delivered it. 

    Today the economy is stronger. Trump’s brand of optimism is exactly the right fit for this situation. If we believe things will get better in a Trump administration – and apparently the public does believe that – the belief itself will make it happen.

    The average citizen doesn’t understand economics. We don’t understand the Federal Reserve, currency fluctuations, trade deals, or much else in that field. But when we see Trump and Pence negotiate with Carrier and Ford to keep jobs, we understand that. When Trump says he will negotiate with Boeing to lower the cost of Air Force One, we get that.

    Trump, the Master Persuader, is rewiring our brains in real time – while we are watching him do it. He wants us to be optimistic about the economy, so he finds the right buttons (Ford, Carrier, Boeing) and he pushes them. He looks for situations that have simplicity and a visual element. It is easy for people to imagine a Ford automobile, a Carrier air conditioner, a factory, a worker, an airplane, and Mexico. Every element of these stories is visual. That’s not an accident. That is technique.

    And as I explained to you in a prior post, Trump and Pence are playing what I call the “New CEO Move.” That involves moving fast and decisively on day one to set the mood for the rest of their term. So far they have set the mood as aggressive negotiators on behalf of the country, clawing and fighting for every American job. That is persuasion perfection. I’m not a presidential historian, but I’ll bet Trump has handled the president-elect phase better than any prior president of the United States. And probably better than any leader-elect anywhere, at any time. Trump is managing our expectations directly. And he’s nailing it.

    At the same time Trump and Pence are giving a master class in how to do the presidency right, their American critics are under the hallucination that we are living in some sort of 1930s Germany situation where Hitler just came to power. That delusion is the weapon of mass destruction left behind by the Clinton campaign that sold that version of reality to its followers. It was a dangerous strategy because the psychological “bomb” could only deactivate itself if Clinton won the election. Then she didn’t. So it falls to Trump to deactivate the delusion, which he has already started to do. Every time Trump acts sane, reasonable, and inclusive, the 1930s Germany delusion gets a bit weaker. A strong economy will weaken the Hitler hallucination as well. 

    On Climate Change

    Trump is also well on the way to changing the public’s thinking on climate change. Trump met with Al Gore, and he’s meeting with climate activist and actor Leonardo DiCaprio on the topic. Trump is looking for common ground and education on the topic, I assume, but he is almost certainly also looking for the persuasion buttons. And this is a hard one.

    The simple, visual persuasion favors the climate alarmists. They can point to rising seas, super hurricanes, and droughts. We can imagine all of that stuff and it scares us. Fear plus a visual element make for the strongest persuasion.

    On the other side of the debate there is no visual persuasion available. Normal weather is just normal. And since you can’t “prove a negative,” there is no way to prove human activity and C02 production will NOT be the tipping factor that ends civilization.

    If you think many people believe in climate science predictions because of the science and the facts, you don’t know anything about human beings. We just observed an election in which facts and policies barely mattered at all. What matters is how we feel. Climate change is the same situation. All of the natural elements of persuasion are on one side. We can visualize bad weather and it scares us. The other side has nothing, persuasion-wise.

    I’m not a scientist, so I can’t evaluate the claims of climate science. But I’m knowledgeable in persuasion, and I can tell you with a degree of certainty that the number of citizens that believe in climate science predictions of doom would be the same whether the science was valid or not, because the persuasion advantage points in that direction. If something is scary and you can visualize it, you treat it like it is real. Even if it isn’t.

    Some say that the risk of climate change is unpredictable, and that’s reason enough to get serious about it. Maybe climate change will do nothing but help crops in some places. But maybe it will destroy civilization. Shouldn’t we take seriously any risk with that much downside?

    Answer: No.

    Because lots of risks have a worst-case scenario. And they all look terrible if you think about them long enough. It isn’t rational to make all of your major decisions based on the worst-case scenario for every situation.

    My best guess from the perspective of a non-scientist observer is that human activity does change the atmosphere, but the climate prediction models are unlikely to be accurate because complicated models rarely are. Once you get more than three variables, and you have humans deciding which data to use and when to smooth it, you end up with nonsense. Climate science has more than a few variables. So I expect the models are nonsense, which is a separate issue from the underlying truth which could be anything. I don’t have any insight on the underlying truth of climate science. All I see is persuasion of various types.

    Prediction: By the end of Trump’s term it will be considered common knowledge that we need to be aggressive in green energy for a variety of reasons, but the public will not trust the climate model predictions. We’ll get to a greener world for reasons of economics and strategy. We’ll never really know if we solved climate change problems at the same time.

    And do you know what gets us to that greener world faster?

    Answer: A strong economy.

    You have never been safer.

    You might like my book because of the strong visual persuasion I am using. 


    See more Kristina Basham on Instagram here.

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