Posted on 07/30/2018 3:08:45 PM PDT by 2ndDivisionVet
Mike Gallagher, managing director at financial consultancy Continuum Economics, played down stellar predictions of growth by Donald Trump, adding that recent polices implemented by the U.S. president would only provide short-term benefits for the economy.
Trump told talk show host Sean Hannity on Friday that the U.S. could reach historic growth rates if the trade deficit is cut in half. His remarks followed a data release showing that the U.S. grew at 4.1 percent in the second quarter of the year. He claimed that the country could reach GDP growth of 8 or 9 percent, which is far higher than economists predict. He did not specify whether he was referring to an annual or quarterly growth rate.
When asked about the 8 and 9 percent figure, Gallagher told CNBC: "No, no, not at all."
"You're going to find it difficult to even get sort of 3 percent on a long-term basis," he said.
The Trump administration put forward a tax overhaul at the end of last year, which has supported the economy. In general, companies have more money to invest and have raised salaries in some cases; giving citizens additional income to spend.
According to Gallagher, this policy has been the driver of the current strong performance of the U.S. economy; but its benefits are only temporary.
"There's a tailwind at the moment because of the fiscal policy changes that they have made, because of the tax cuts that get you into 2019 but then once you're getting into late (20)19, (20)20 fiscal policy actually turns contractionary rather than expansionary....
(Excerpt) Read more at cnbc.com ...
Mike Gallagher’s going to look pretty damned stupid when Trump’s prediction of 9% growth turns out to be pessimistic.
Last year, they were saying that 3% growth was impossible too.
I would be curious to know ihow this same expert described the economy during the Obama years.
Gushing is one word that comes to mind.
They haven’t learned a thing. I would never, at this point, bet against The Donald.
” Gallagher told CNBC”
That’s all the reader of the article has to see...…
to know this story is pure unadulterated BS!
Trump speaks the Truth!
“Last year, they were saying that 3% growth was impossible too.”
You beat me to it. The “experts” never are.
A financial writer for NY Post wrote that the real adjusted for inflation GDP was actually 5.4% so let’s see. Barry said we should get used to 2%.
I think this Arthur C. Clarke quote probably applies to economists/financial strategists as well:
“When a distinguished but elderly scientist states that something is possible, he is almost certainly right. When he states that something is impossible, he is very probably wrong.”
Well, looks like President Trump blew through THAT limitation on his skills and imagination.
An industrious, determined US workforce is more than capable of creating that much productivity. And as the industrial base becomes more productive, the revenues, even with sharply reduced tax rates, becomes an engine for prosperity when the government spending becomes superfluous to existing programs, simply because their clientele shall have been absorbed back into the work force.
Next we can start on reducing the national debt. First by reducing government spending, then by using the revenue flow to buy back all the obligations now out there.
If the congresscritters could get some spending under control, you might see gasoline prices drop on growing strength of the USD. Cheap energy + lower taxes + lower gubbamint spending = booming economy! :-).
I don’t see how that high a rate could happen but I did learn a year and a half ago not to second guess Donald Trump.
I find most of the politicians, and the punditry buzzing around them to be very often those who more than anyone in society hold back the nation. They are generally amongst the least creative people in the nation, are a self-selected group of narcissists, and tend to be unimpressive in their ability to think outside the box and problem solve. When you hand power over to people like this, it is a formula for incompetence in government - which we’ve experienced for many, many decades. Further, because of their false perceptions of themselves, these people tend to fight fiercely to hold on to their power and stature - almost always to the detriment of the nation.
That said, Trump is one of a large number of people from the private sector that can and do run rings around most if not all of the DC - connected crowd. It’s not a surprise that he’s done so well. He’s an accomplished person who works in the real world - where you don’t get paid unless you deliver.
https://tradingeconomics.com/united-states/gdp-growth
The astronomer, William H. Pickering, said with regard to air flight after the invention of the airplane:
“...The popular mind often pictures gigantic flying machines speeding across the Atlantic and carrying innumerable passengers in a way analogous to our modern steamships...It seems safe to say that such ideas must be wholly visionary, and even if a machine could get across with one or two passengers the expense would be prohibitive to any but the capitalist who could own his own yacht. Another popular fallacy is to expect enormous speed to be obtained. It must be remembered that the resistance of the air increases as the square of the speed and thework as the cube...If with 30 h.p. we can now attain a speed of 40 m.p.h., then in order to reach a speed of 100 m.p.h., we must use a motor capable of 470 h.p...it is clear that with our present devices there is no hope of competing for racing speed with either our locomotives or our automobiles.”
Please save this for when the prediction turns out to be a joke.
we have to remember that Obama throttled growth and that makes me thin that 6-9 percent growth might be possible for the short term till pent up potential is spent from what the Obama years did.
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