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Monday, November 28, 2016

Amazing What A Difference Two Weeks Make

During the presidential campaign, the constant theme from Hillary Clinton and the mainstream media was that Donald Trump's economic plans would not work.  Growth would be lower than under Hillary's plans.  Jobs would be lost if Trump won.  The stock markets would tank big time.  The only safe bet for the economy was to choose Hillary, or so they told us over and over and over.

Now we are a little over two weeks later, and the story has completely changed.  The stock markets have soared as investors celebrate the return of pro-growth policies which will be coming from Trump.  Now, the OECD has changed its forecasts for economic growth in the USA by doubling the expected rate of growth over the next two years.  The OECD is he Organization for Economic Cooperation and Development.  It just revised the growth rate projected for 2018 to 3.0% which would be higher than any year during the Obama presidency.  It's important to note what that 1.5% increase in the growth rate means; 1.5% is the equivalent to about an extra quarter of a trillion dollars of output by the economy.  Just imagine how many people will be employed to produce that enormous amount of output.

The OECD is being a bit too conservative in its estimates.  By 2018, the USA should be closer to 4% than 3% in growth.  The precise number does not matter for present purposes, however.  The point is that after six plus months of being told by the media that Trump would be an economic disaster, the truth has emerged.  The Trump economic program will be strongly pro-growth.  For the first time in a long time, the president will view the American economy as something to promote rather than something to squelch.  The media knew this all along, but they just couldn't bring themselves to report the truth......until now.

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