Another inflator? You mean to continue the policies leading to the huge inflation we are seeing now? Or which you guys have been expecting for the past 8 years or so?
The downturn will happen when Wile C. Wall Street looks down and sees the canyon floor. Or when the idiots in the administration screw up the long overdue crisis stemming from somewhere. (I’m betting on China.)
Then the increased deficit will make it hard to deal with the downturn. Just like what happened during the Bush years.
This.
It’s insane to imagine that the reason that Walmart pays employees X is because that’s all they can afford to pay. They pay as little as they can and still maintain staffing levels / quality.
In this situation however, with a sudden, massive corporate tax break, it definitely makes strategic sense for them to throw out some breadcrumbs so no-one gets too upset and agitates for a repeal.
That an economic downturn is inevitable should be obvious. That it will occur in the next two years is certainly debatable.
Wait, we are predicting that the business cycle will occur now?
One thing I wasn’t going to mention in this thread, because I didn’t want to hijack, but sod it; is that in much of the conservative media they are talking about Trump getting the economy “back on track” after “years of decline”
But what apple to apple benchmark was going in the wrong direction under Obama, and the right direction now?
But I’m willing to give trump credit for not screwing up the economy yet, and look forward to conservatives giving Obama credit for his accomplishments.
“Wages Rise as U.S. Unemployment Rate Falls Below 5%” (February 2016)
“As wages rise, CEOs are starting to complain” (July 2016)
“U.S. Wages Rising At The Fastest Pace In Years Amid Solid Hiring” (November 2016)
It’s the amazing time-traveling tax cut!
GDP growth was rather anemic under Obama. I don’t know if you’d call that “the wrong direction”, but ~2% growth is nothing to sing about. Under Trump it’s done better.
The economy is doing well in part due to Trump’s policies, but it’s not really accurate to call it an “economic plan”. More kneejerk Trumpian instincts like immigration control and tax cuts are causing wages to rise. Shortage of workers plus more money in corporate coffers.
There is never any one policy that affects the economy, but it is very likely that better immigration enforcement+ tax cuts is helping wages rise now even more than in 2016. While recognizing that the factors leading to wages rising in the first place were already in place under Obama, Trump’s policies have added more fuel to the trend.
I would love Trump to stand in front of me and explain exactly what his economic plan actually was…
No doubt he would know exactly what his aims were and economic theories involved.
If you look at this graph of GDP and then click “10Y” you’ll notice that actually under Obama we had a number of quarters at or above the current rate, and so far there is no real indication of an uptick versus the longer term trend.
And anyway I think calling 2% anaemic would be unfair. Wealthy countries only look to grow 2-3% a year; more might mean a damaging spell of inflation, and post-recession, most industrialized countries wished they could hit the lower end of that bracket.
I’m pretty comfortable, yes. We having been living in unprecedented times of Fed manipulation since 2008, so it’s possible the bubble will continue to grow for over two years, but not likely by my guess.
I haven’t been predicting price inflation as measured by CPI. Some have. I have been seeing predictions that have not panned out from “you guys” as well.
The Fed had no difficulty in its unprecedented interventions during the downturn. The Congress also had no difficulty in spending huge sums of money for bailouts and stimulus either. Not sure why you think large budget deficits make it “difficult” to enact Keynesian measures when the Keynesian measures are budget deficits.
What will make it difficult during the next downturn is that the misallocation of resources and malinvestment will not be directed into sustainable ventures because of Fed and congressional intervention. The same thing happened with the last downturn and the one before that.
Or we could wait and see.
You do have to consider the magnitude of the financial disaster he inherited, and from whom.
Mijin asked for an “apple to apple benchmark”. If this is your response for GDP growth, is it fair to say that you just don’t believe there are any valid apple to apple benchmarks?
You don’t think it’s appropriate to allow for some lead time for a President’s first budget even to be passed, much less kick in, or for his policy changes to take effect before holding him responsible for the results?
You want to credit Trump for Obama’s policies while blaming Obama for Bush’s disasters, and credit Bush for Clinton’s successes (“Irrational exuberance”, remember?); we get that. It lets you support repeating Bush’s disastrous policies while, we can predict, similarly denying responsibility.
To the extent that Trump’s executive orders have been to dismantle regulations on business and introduce policy to reduce taxes, I must reluctantly give him credit for adding fuel to the existing rate of economic growth. Whether his policies ultimately prove themselves to be vaporware, or even sugar in the economic gas tank, well, that remains to be seen. I’m absolutely certain that his administration’s ability to deal with or avoid a potential collapse of an economic bubble is nil.
True enough, and some of the continuation of the stock market boom is the result of anticipation of such things by investors, even if they never actually come to happen. So, if the hoped-for results do not occur and stock prices begin to reflect that reality instead, to that extent it’s the responsibility of short-term-thinking market manipulators than of anyone in the government.
I still say that gov’t policies set the mood for the market and its reactionaries (which are by their nature short sighted). To that extent, we must give unto Trump that which is his. Of course, when things go in the other direction, that too must be given on to him.
But a real economist advising Trump would understand that and would make Trump aware of the possible downside and that the stock market doesn’t necessarily reflect true economic change.
Not that Trump would understand or even listen one bit.
He’d understand that* his own* portfolio is growing. That’s all the economic change that interests him.