Thursday, May 4, 2017

"Using Persuasion to Create Assets Out of Nothing"

"Using Persuasion to Create Assets Out of Nothing"
by Scott Adams

"President Trump unexpectedly said he would be “honored” to meet North Korea’s Kim Jung-un. And that’s how a Master Persuader creates an asset out of nothing. I’ll explain.

By holding out the possibility of meeting with Kim Jung-un, President Trump has conjured out of thin air a virtual “asset” that he can use for negotiating with North Korea. I’m sure the North Korean leader would like the international respect and recognition that such a meeting would confer. Best of all, Jung-un could use that future meeting as evidence for his citizens that he stared-down America and negotiated a great deal in which we remove some of our military assets while they end their nuclear weapons program. Or something like that. The point is that President Trump created this “asset” out of nothing but persuasion. Now Kim Jung-un has something to gain, and something to lose. And that option simply didn’t exist a week ago.

Do you think this was a unique situation? Consider that President Trump has already built a border wall with Mexico out of nothing but persuasion. Immigration from Mexico is down more than 50% just from Trump’s persuasion alone. I suppose we will get something like a physical wall someday too. But for now, Trump’s Wall of Persuasion is doing a lot of work.

Now take a look at the stock market. Optimism about a Trump presidency has increased the value of the stock market by a gazillion dollars (approximately) since election day. In other words, President Trump’s persuasion created a lot of something out of nothing. Again. I hadn’t heard much about the alleged trillion dollars held offshore by American corporations until Trump started talking about repatriating it. If the tax code is tweaked just right, much of that money will come back. That’s like Trump’s persuasion creating something out of nothing too.

President Trump cancelled TPP, criticized NAFTA, and warned China that trade negotiations will be aggressive. That collection of persuasion will probably create money out of nothing for America. Before President Trump came to office, some NATO countries were not paying their agreed share of the expenses. Now countries are starting to step up. That change came from nothing but persuasion.

If you think climate prediction models are unreliable, President Trump just conjured up a few trillion dollars in cost savings by favoring job creation and economics over CO2 reduction. Obviously that could be the wrong bet, but you see a consistent pattern: Trump traded something that might not be based on reality – the fear of global warming – for something he knows is real – the economic growth and cost savings.

President Trump’s tax plan will attempt to conjure up free money too, using a Trump variant of supply-side economics. The idea is that by cutting taxes you stimulate the economy and make the tax cuts pay for themselves by creating more income that can be taxed. In the past, corporations would have banked the extra cash from any tax savings and continued moving their operations to cheaper offshore workers. But in the Trump administration, moving operations outside the USA is harder. That means corporate tax savings will have a far greater chance of leading to higher employment here. And employment is THE biggest variable in economic prosperity. If the tax cuts create higher employment, Trump will have once again conjured something out of nothing.

A year ago, President Trump’s critics were calling him a “con man.” But they never said he was bad at it.”

1 comment:

  1. What Trump is doing is not "creating something from nothing." What he is doing is paying attention to details and what is good for America. It is the WIIFM, the "What's In It For Me?" question. Pathetic politicians gave away the farm for their own positions and bank accounts and Trump is showing the world that you can have your cake and eat it too.

    This guy is an incredible CEO. My hat is off to him. 100 plus days! He has already put Obama to shame for eight years of BS.

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