The Yankee Tiger—Get Ready for America’s New Boom

Today, we land in a place you’ve likely never heard of: Gort, in Ireland’s County Galway.

It’s the same place where a whole bunch of Brazilian men landed—and they’d never heard of the place either—circa 1999.

Now, to be clear, this isn’t the story of Gort. Or Brazilians. But the anecdote is a fine intro to a story about America and what I’ve taken to calling the Yankee Tiger.

Now, the Yankee Tiger is a close relative of the Irish Celtic Tiger… and that’s why I need to tell you the story of the Celtic Tiger first…

That takes us back to Gort…

Seán Duffy Meat Exports needed skilled hands and couldn’t find them in Ireland because decades of Irish struggles and haggardly Irish economies had seen hundreds of thousands of Irish decamp for America and Europe in search of a better life.

But a funny thing happened on the road to poverty: a Celtic Tiger was born.

In one of those “we’ve not nothing left to lose so might as well try this” moments, the Irish government started cutting spending drastically in 1987. Unions agreed to hold down wages. And the local Irish pound—this was before the euro—helped as well, when it lost about a third of its value against the West German mark, the Big Daddy of European currencies at the time.

Suddenly, the rest of Western Europe and America realized that Irish workers and Irish goods were cheap. Cheap brings factories. Cheap increases demand for local products.

American manufacturers arrived to build production plants in Limerick, in Leixlip, in Galway, and beyond.

Unemployment that had been perched at about 17% in the 1980s was down to just 3.4% by 2001. The growth allowed Ireland to shrink its debt-to-GDP ratio to just 25% by 2007 from 95% in 1991. And for the first time in history, income per person in Ireland surpassed that of Britain, the country that had treated Ireland like a disease for centuries.

In 1988, The Economist called Ireland “the poorest of the rich”; by 1997 the same publication was calling it “Europe’s shining light.” Ireland’s economic miracle became known as the Celtic Tiger… riffing off the powerhouse Asian tiger economies.

There simply weren’t enough locals to take on all the work, which is why Seán Duffy Meat Exports had to import men from a small meat-packing village in Brazil… into a country that had been exporting Irish people for decades. To this day, Gort is still known as Ireland’s Little Brazil, though the meat plant closed years ago. Brazilian-run bakeries, snack bars, markets, and beauty salons still line the streets, and estimates say that between 20% and 30% of residents are now Brazilian.

That’s what the Celtic Tiger looked like—fundamental policy changes at a governmental level, along with a weakened currency, that allowed Ireland to reset a moribund economy.

And that’s what I see coming to America as the country progresses through the 2030s.

The US is trapped by debt; literally trapped, as I wrote about back in August in a dispatch explaining the term “fiscal dominance.” The middle class has increasingly limited options because America’s strong dollar has, over the last five decades, sent US manufacturing overseas looking for cheaper production (a good bit of it in Ireland).

Which is part of the reason America’s millennials and Gen Z increasingly say they want to leave the US for better opportunities abroad.

This will end.

And it will end with great pain for the US economy and American households.

But as with Ireland, a tiger will ultimately awaken—the Yankee Tiger.

It arises when the US dollar is reset structurally lower, a move that happens in concert with the rest of the world… or potentially unilaterally.

Either way, America’s money is coming home. It will stop being the crutch the rest of the world relies on and will instead return to its original role as America’s currency. Once we’re past the (intense) pain of that transition… the Yankee Tiger roars.

Middle America booms again. Factories spring up on the foundations of Rust Belt memories now covered in dandelions and garbage.

The Yankee Tiger is the economic boom I see landing in America in the 2030s—a boom that rekindles American manufacturing and the hollowed out American middle class. There’s a lot that goes into that, and there’s a lot of economic and financial pain before we get there, but we will get there… and there will be an almost unprecedented series of opportunities for profit—especially for those who get in ahead of the transformation.

Obviously, there’s a lot more to this story than what I’ve laid out in 800 words. I’m just sharing with you the end of our tale, because that’s what humans want to see—they want to know that there is light on the other side of the darkness they see coming.

And, yes, there is light… in the form of a Yankee Tiger to come.