The US economy seems to be doing quite well at the moment, historically low unemployment, blowout durable goods orders and an upwardly revised 2019 GDP estimates by the IMF. And it seems that at least one Fed rate cut this year is now baked into the cake. Next, the Democrats do what they invariably do (they can’t help themselves) ... they negotiated with the White House fire-house federal spending increases next year in exchange for raising the debt ceiling for two years (until after the next presidential election). Do they not realize that this is fiscal stimulus in an election year? And this will do nothing but help the president’s economic braggadocios?
If China has any smarts, it will realize that fiscal stimulus on top of monetary stimulus will mean that it would be best to cut a trade deal with Trump before he gets re-elected for the best terms possible. And, if it does so capitulate, this will be a a triple economic whammy ... one which could easily drive US GNP growth to over 5% — almost an unimaginable number for the world’s biggest economy!
Now, dear reader do you understand why America’s stock market keeps making new highs day after day?
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