Not Tired of Winning Yet XLVIII
No trade deal with Mexico has been signed yet, but the celebration is perhaps not premature of the hope of things to come. Under the dreary days of the previous administration, there was no such hope for economic growth at any time.
All these wins will be reversed if the House turns Dem in the midterms.
S&P 500, Nasdaq jump to record highs as US and Mexico strike trade deal
The S&P 500 and Nasdaq hit all-time highs, led by gains Caterpillar, Boeing and auto stocks.
Stocks jumped on Monday as the United States and Mexico closed a new trade deal, potentially removing a source of uncertainty that had been plaguing investors for months.
The S&P 500 gained 0.8 percent to close at 2,896.74 — a record high — with materials and financials as the best-performing sectors. The Nasdaq Composite climbed 0.9 percent to an all-time high, breaking above 8,000 points for the first time, as Facebook, Amazon, Netflix and Alphabet rose. Tech’s gains led the Nasdaq to close at 8,017.90.
The Dow Jones Industrial Average rose 259.29 points to 26,049.64 as Caterpillar outperformed. Monday also marked the first time since Feb. 1 that the Dow closed above 26,000.
President Donald Trump said the deal would be called The United States-Mexico Trade agreement, leaving behind the 24-year-old NAFTA name. “The name NAFTA has a bad connotation because the United States was hurt very badly by NAFTA,” he said. Trump added that the deal with Mexico is also very helpful for farmers and manufacturers. U.S. Trade Representative Robert Lighthizer said the deal must be approved by Congress before being implemented.
From the pen of Paul Krugman of the New York Times. Here follows his predictive words of 2016:
It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?
Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.
Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.
Under any circumstances, putting an irresponsible, ignorant man who takes his advice from all the wrong people in charge of the nation with the world’s most important economy would be very bad news. What makes it especially bad right now, however, is the fundamentally fragile state much of the world is still in, eight years after the great financial crisis.
It’s true that we’ve been adding jobs at a pretty good pace and are quite close to full employment. But we’ve been doing O.K. only thanks to extremely low interest rates. There’s nothing wrong with that per se. But what if something bad happens and the economy needs a boost? The Fed and its counterparts abroad basically have very little room for further rate cuts, and therefore very little ability to respond to adverse events.
Now comes the mother of all adverse effects — and what it brings with it is a regime that will be ignorant of economic policy and hostile to any effort to make it work. Effective fiscal support for the Fed? Not a chance. In fact, you can bet that the Fed will lose its independence, and be bullied by cranks.
So we are very probably looking at a global recession, with no end in sight.
From Stephen Moore at Investor’s Business Daily:
Since the day Donald Trump was elected president in November of 2016 the Dow Jones industrial average has risen by some 35%, making the last 14 months one of the greatest bull-market runs in history.
Some $6 trillion of wealth has been created for Americans — which is very good news for the 55 million Americans with 401k plans, the 25 million or so who have IRAs, and another 20 million with company pension plans and employee stock ownership plans.
The left was certain that exactly the opposite would happen with a Trump presidency. To borrow a recent phrase from House minority leader Nancy Pelosi, Trump’s policies would cause “Armageddon” for family finances, the American economy, and the stock market.
Keep all this talk of economic meltdowns and financial market doomsday in mind the next time you hear a news commentator say that “most economists” believe that Trump’s policies won’t work, or “mainstream economists” believe Trump doesn’t know what he is doing. When it comes to Trump, his critics so far have almost all been not just wrong, but dead wrong.
Here are some of the greatest hits, gleefully compiled from the media over the past 18 months or so.
“Donald Trump’s first gift to the world will be another financial crisis.” Headline in the U.K. Independent. “(He) gives every impression that he will soon be hustling America — and possibly the entire world — in the direction of another catastrophic financial crisis.” Same article.
“I have no stocks. I advise people not to invest in the stock market, not now. Way too dangerous.” Film maker Michael Moore, August, 2017.
“It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover? A first-pass answer is never… So we are very probably looking at a global recession, with no end in sight.” Paul Krugman of the New York Times the day after the election.”Trump’s domestic policies would lead to recession.” Former GOP presidential candidate Mitt Romney, March 2016.
“If Trump wins we should expect a big markdown in expected future earnings for a wide range of stocks — and a likely crash in the broader market (if Trump becomes president).” Eric Zitzewitz, former chief economist at the IMF, November 2016.
“Under Trump, I would expect a protracted recession to begin within 18 months. The damage would be felt far beyond the United States.” Former Clinton and Obama chief economist Larry Summers, June 2016.
“Trump would likely cause the stock market to crash and plunge the world into recession.” Simon Johnson, MIT economics professor, in The New York Times, November 2016.
“Citigroup: A Trump Victory in November Could Cause a Global Recession“, Bloomberg Financial News headline, August 2016.
“I have never seen an election in which the markets have so strong of a view as to what was good and bad about the outcome. And what you saw was the markets rallying yesterday because of the FBI thing on Sunday. And the reason I mention this particularly is if the likely event happens and Trump wins you will see a market crash of historic proportions, I think…The markets are terrified of him.” Steve Rattner, MSNBC economics guru and former Obama Car Czar, October, 2016.
“Wall Street is set up for a major crash if Donald Trump shocks the world on Election Day and wins the White House. New research out on Friday suggests that financial markets strongly prefer a Hillary Clinton presidency and could react with panicked selling should Trump defy the polls and deliver a shocking upset on Nov. 8.” Ben White, Politico, October 2016.
And finally, and most unambiguously:
“A President Trump Could Destroy the World Economy“, headline of Washington Post editorial, October 2016.
Just for the record, the world economy is as strong today as it has been in at least a decade, as the Wall Street Journal recently reported. Now the left has to engage in logical contortions to explain how the red hot American economy is really a result of Obama policies — every which one Trump has systematically been at work dismantling.
And, for my one reality-free reader who insists that Trump is secretly a Socialist, and that our economy, despite appearances, is actually in the same shambles as that of Venezuela, my prediction (based on listening to what the Administration actually said its plan was) that the tariffs so soundly denounced by my reality-free reader as protectionism were in fact nothing of the kind. They led, as expected, to a new deal with the EU, a free trade deal.
Those were not tariffs. They were the art of the deal.
I am not alone in this opinion. Here is Mr. Moore at Agrinews:
Trump and the European Union reached a handshake deal that is designed to lower tariffs on both sides of the Atlantic. They agreed to shoot for zero tariffs.
The exact details are a bit murky, but what we do know is that the EU has pledged to lower its tariffs and other trade barriers on American soybeans, oil and gas, pharmaceutical products and certain manufactured goods. Trump promised to suspend some of the auto and aluminum and steel tariffs that he was threatening to whack the eurozone with.
It gets better: The two sides also agreed in principle to find ways to combat “unfair trading practices, including intellectual property theft, forced technology transfers, industrial subsidies and distortions created by state owned enterprises,” according to a joint statement released by Trump and European Commission President Jean-Claude Juncker.
These are the very trade violations that Trump has been railing against. We don’t engage in these anti-trade activities; Europe, Japan and China do. Before Trump came on the scene, most nations denied that this cheating and stealing were even happening.
Any progress in ending these unfair trade practices is an indisputable victory for the United States. In 18 months, Trump accomplished something that no previous president of the last 30 years could.
All these wins will be reversed if the House turns Dem in the midterms. Do you forget the days of lingering misery under socialist medicine and sub-3% growth of a stagnant economy? Do you remember being told to shut up and to accept poverty as the new normal?
About John C Wright
John C. Wright is a practicing philosopher, a retired attorney, newspaperman, and newspaper editor, and a published author of science fiction. Once a Houyhnhnm, he was expelled from the august ranks of purely rational beings when he fell in love; but retains an honorary title.
