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Trump’s Economic Era

of unemployment and reduce the money supply during
inflationary times, but it cannot do both with
stagflation.

Austrians criticize these mandates because they
are more reactive rather than proactive. Instead of
concentrating on long-run growth, it forces authorities
to stress the short run. The ideas of Keynesian
economics took root in most of the world until the
election of Donald Trump rejuvenated the views of
Austrian economics. Austrians concentrate on basic
principles and use deductive reasoning rather than
mathematical models. Donald Trump supports the
Austrian view because he believes in growing the
economy from the bottom up, not from the top down.

FANNIE MAE & FREDDIE MAC

Congress established Fannie Mae in 1938 and
Freddie Mac in 1970 with a federal line of credit to
moderate the business cycle and add liquidity to the
mortgage market. Fan and Fred do not make loans; they
buy loans. Banks do not keep
mortgages; they sell them to
Fan and Fred do
not make loans; Fan and Fred. The bank can
they buy loans. now make another mortgage
loan, sell it, make another
and so forth. Congress
figured that this would juice the mortgage market and
lead to more growth and opportunities for everyone.
Fan and Fred profit from this arrangement by
securitizing the loans.

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