AFAIK, "Business Insider" has nothing to do with IBD. I take anything they publish with several tons of salt.
Posted on 12/22/2016 2:58:45 AM PST by expat_panama
President-elect Donald Trump promised on the campaign trail to return the US to 4% gross-domestic-product growth during his presidency.
One of the best ways to achieve this appears to be his proposed $550 billion stimulus package to help rebuild infrastructure.
Even if Trump can get his infrastructure plan past Democrats, deficit hawks in his own party, and regulators, there may be one more opponent preventing an economic boom: Federal Reserve Chair Janet Yellen...
...comments at the Fed's December meeting appear to signal a "Yellen Call" that will dampen the financial and economic impact of any large-scale infrastructure plan.
The strategists argue that Yellen is concerned that the economy is near full employment...
...clearly focused on the prospects for fiscal stimulus at a time of full employment... ...'… my predecessor and I called for fiscal stimulus when the unemployment rate was substantially higher than it is now.'... ...she nonetheless continued to make the case for 'the strongest job market...
...Trump's picks for Treasury and commerce secretaries, have said Yellen has done a good job at the Fed, so Trump's more confrontational tendencies may be muted...
...Equities and other risk assets have been on a tremendous run since the election on the prospects on higher growth (and lower taxes), so counteraction by the Fed may dampen their hopes.
"What increasingly seems less uncertain, however, are the risks to risky assets stemming from the 'Yellen Call' (the logical successor to the 'Bernanke Put')," the Goldman team says. "This is the idea that subsequent rallies in risky assets from here will likely provoke a more rapid tightening of monetary policy."
Despite Trump's claims of a massive economic boost, Yellen and the Fed may put a cap on just how high this stimulus can push markets or the economy.
(Excerpt) Read more at businessinsider.com ...
Answer: Trump also campainged to keep rates low:
http://blogs.wsj.com/economics/2016/09/12/donald-trumps-shifting-words-on-interest-rates-and-janet-yellen/
Hoodwink alert!
It is not a zero sum equation! The lawyers in Congress are about to get a very big education, the hard way.
This must be in the IBD’s comedy section. They use a comedic phrase of “deficit hawks” who in DC dem or Rep falls under that phrase?
It is near "full employment" by which measure? I've heard that record numbers of people have left the workforce, that record numbers of young adults are still living with their parents, and that many people who do work are juggling two or three part-time jobs. None of these measures point at "full employment" to me.
I really should have known since the previous year the 386 had been introduced. The company I worked for had some of the first versions. So I should have known the new PC economy would take off. An entire minicomputer on a single board. I guess the reason I wasn't a believer was that coming off the wave solder station. Zero yield. Every board had to be traced and resoldered by hand. I was a lousy tech and the best I could was sit and watch. I was good at SW not HW and should have realized that HW would be free and SW would have the most value.
I should have also realized that the high rates from previous years that paid for my college would not kill the economy. On the contrary they strengthened the dollar after its 1970's beating, we imported cheap Japanese hardware, wrote SW and cleaned up against the Japanese who were, by 1988 going to take over the world economy.
Things are a bit different today starting with a strong dollar but as Kudlow says we want it to be strong for the right reasons. We may also be on the cusp of another economic change where automation will help bring back our manufacturing. The jobs will come with it, contrary to the naysayers, and they won't all require college.
The best way to bring back growth is a round of tax cuts.
AFAIK, "Business Insider" has nothing to do with IBD. I take anything they publish with several tons of salt.
“The best way to bring back growth is a round of tax cuts.”
I would argue that leaving tax rates essentially alone and eliminating the senseless, onerous, choking regulations would do more than tax cuts. And there are plenty of those around to get rid of.
I hope this will not be misconstrued as being against lower tax rates. Far from it.
The Fed is concerned about inflation. If the Fed is now talking about more interest rate increases during 2017 then it’s an indication that they expect the economy to grow at a faster rate under Trump than they expected under Clinton.
Deficits, too. Yellen has always been a deficit hawk.
“I would argue that leaving tax rates essentially alone and eliminating the senseless, onerous, choking regulations would do more than tax cuts. And there are plenty of those around to get rid of.”
Regulation isn’t just a problem at the federal level. Many states tie up businesses in a labyrinth of regulations, rules and licenses.
WTF can TRUMP get rid of Yelling?
President Trump could benefit greatly by establishing an independent committee to identify the true baseline of the current economic state with respect to the ‘Great Depression’ era. Then he can report on progress versus at baseline with tangible, accurate statistics. If he starts reporting improvements based on leftist lies he won’t have anything to show for all of his great work.
> “The strategists argue that Yellen is concerned that the economy is near full employment.”
There are 94 million people out of work.
One of the things that requires a review is the deception of economic formulas in computing statistics. Current formulas for computing economic statistics of key indicators are inaccurate and purposefully so.
Meddling to the degree noted is beyond her capacity. She dare not
This is sourced from ‘Business Insider’ which is a recent entry to the ‘moderate’ category of business blogging. They are in fact founded by hard-core leftists who purposefully hide their true agenda.
My take: aside from the fact that she’s not clear on the fact that she needs to give up on fiscal policy and stick to monetary policy —that she’ll raise rates if she really thinks we got inflation if she doesn’t she won’t.
If Yellen proves to be an obstacle she’ll be gone.
Trump can raise 100,000 protesters to show up at her home if he asks them to.
“Regulation isn’t just a problem at the federal level. Many states tie up businesses in a labyrinth of regulations, rules and licenses.”
Good point.
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