A year ago today, I posted some statistics on the state of the US economy at the start of the Trump presidency. So, on this 1 year anniversary of taking the innaguration, as we face a Government shutdown over the budget, let’s take a look and see how things are going…
Of note: the stock market has been on a historic tear, and inflation has been flat. I know Trump would like to take credit for the positives, and blame someone else for the negatives, but how would you rate the state of the economy 1 year into the Trump admin?
My opinion - the pre-election predictions of a crashed and burned economy did not pan-out, yet, and perhaps the markets have been reacting to the promise of no new/removal of regulations. What do you think?
There is certainly an abundance of evidence for favorable correlation. I will consider evidence for causation when the economy begins to sour and the Trump administration takes positive steps to correct/improve it.
The economy seems to be doing well, but that is more Obama’s doing since he laid the groundwork over the last 8 years for a recovery. I have pretty much zero faith in the GOP and Trump to actually correct the economy if it starts going bad. To their credit, their tax bill may delay a recession until after 2020, which means if a democrat wins in 2020 they will get blamed for any recession. So that was smart on their part.
As far as low unemployment, it is good but are the jobs being provided good jobs? I know the U-6 is low, which is good. But are people able to pay their bills ans ave money with the jobs in the current economy? I know that despite low unemployment, wages haven’t been increasing which isn’t a common thing by historical standards.
The uninsured rate was probably 10.9% in January 2017, vs 12.2% now. Where did you get 8.6%?
I don’t see anything significantly different in the rate of change except for the uninsured and the deficit. Where the numbers haven’t changed I’d have to see a history to see if they should have.
So far I don’t see anything of note. With rare cases like when Obama took over the economy in a tailspin there aren’t going to be any big differences one year into a new administration.
I agree it may be too early to tell if things are healthier. I guess Trump can take credit for not crashing the economy as much as he likes to take credit for planes not crashing while he is in office.
I’m very skeptical of using the DOW or other indices to measure the health of the economy. I see the stock market as a severely inflated bubble right now, P/E ratios are just stupid.
There are not enough good investments to be had right now, so the only place to put your money is the stock market, and since everyone is putting their money into the stock market, the money in the stock market, it’s “value” grows as well.
If demand could go up a bit, that would increase earnings, then it could fill in the hollow below these stock prices, dropping P/E ratios to more manageable levels.
I do fear that the stock market is one big game of hot potato. I couldn’t tell you when the music is going to stop, but you don’t want to be highly leveraged in stocks when/if it does.
Trump’s first 100 days vs. Obama’s first hundred days: market returns (from here). Looks like the market is doing worse under Trump than it did under Obama.
Rising stock prices are due mainly to a belief that corporate profits will continue to rise — a logical belief given the dramatic cut in corporate taxes. Lower personal income tax rates for rich stockholders also make stocks more attractive. And, as k9bfriender points out, today’s very low interest rates prop up share prices. The bull market may seem overpriced and therefore fragile, but what specifically will bring it to an end?
I want to see a thread in IMHO, and am looking for a volunteer to start it! :— What are likely economic scenarios over the next two to three years?
Will the dollar continue to weaken? Will a continuing boom lead to higher interest rates? What are the best questions to ask?
What type of shock, if any, is most likely to stun the U.S. economy over the next 2 or 3 years? Major foreign crisis? Domestic political crisis? Another financial credit crisis?
What developments would be most worrisome? What would be the economic results of a major shock?
I think the run-up was in anticipation of the tax cuts, and the tax cuts are fueled by one and a half million million dollars of borrowed money.
It’s kind of like how I could afford expensive vacations and toys if I took out a bank loan and ran up my credit cards. And my friends would think I’m much better off than I was last year, and all visible indications would show that they were right.
(Full disclosure: the article says that the donation can be as little as $1, but the title of the link is what appears on the headline page. And no, that isn’t a joke.)
