The Re-Engineering of Creditism Has Begun
For decades, policymakers responded to economic stress by doing one thing: stabilizing the existing system.
When growth slowed, they eased monetary policy.
When markets wobbled, they reflated asset prices.
When inflation threatened, they leaned on globalization to suppress wages and goods prices.
That approach worked—until it didn’t.
In my new Macro Watch video, The Re-Engineering of Creditism, I explain why the global economic system has now moved beyond stabilization and entered a far more consequential phase: structural change.
From Stabilization to Re-Engineering
Economic systems don’t collapse because policymakers make small mistakes.
They fail when the constraints surrounding them change, and the old tools stop working.
Since the Global Financial Crisis, Creditism—the credit-driven economic system that replaced gold-standard Capitalism—has been kept alive through expanding debt, central-bank balance-sheet growth, and asset-price support. But over time, new constraints emerged:
- Political consent began to erode
- National security concerns became binding
- Credibility—monetary, fiscal, and institutional—came under strain
By the mid-2010s, it was no longer enough to quietly stabilize the system. The political backlash against late-stage Creditism had arrived.
Why 2016 Was a Turning Point
The election of Donald Trump marked a break—not because he offered a coherent economic theory, but because his policies stress-tested the system’s operating assumptions.
Trade, fiscal policy, globalization, and central-bank independence were no longer treated as neutral or untouchable. Economic efficiency ceased to be the highest objective. Policy became openly political.
That shift did not end with Trump’s first term.
As the video explains, the Biden administration did not reverse course.
Instead, it pursued many of the same objectives through existing institutions—industrial policy, large fiscal deficits, supply-chain restructuring, and state-directed investment—while changing the rhetoric.
Under Trump’s second term, the process has accelerated further.
What This Means for the Future
Today, the US government is no longer acting merely as a market backstop. Increasingly, it is behaving as a strategic investor, treating its ability to borrow, spend, and mobilize capital as a core asset.
Trade has become a fault line.
Tariffs are now structural policy.
Capital flows are being redirected.
And monetary authority itself is moving into open political conflict.
This is not a temporary response to crisis. It is a re-engineering of how the system operates.
In this video, I walk through:
- Why stabilization failed
- How political backlash reshaped economic policy
- What Trump 1.0 changed—and why it mattered
- How Biden institutionalized the shift
- Why Trump 2.0 represents an acceleration, not a reversal
- And what all of this means for the survival of Creditism itself
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