Trump's 'economic miracle' will leave us all paying the price

Trump Breaks Tradition on GDP Figures

Economists' forecasts for second-quarter GDP, the value of all goods and services produced in the nation, ranged from 3 percent to 5 percent.

Economists are generally predicting slower growth in the second half of the year, though, as the effects of the tax cut wear off and rising interest rates depress consumer spending. But private forecasters cautioned that the April-June pace is unsustainable because it stems from temporary factors.

"If the USA and its partners do implement substantial tariffs and other trade barriers, United States economic growth is likely to be much weaker than this baseline forecast", chief economist Gus Faucher wrote. We'll stream it live on FOX 2 News now on our Facebook page.

Trump, who has repeatedly attacked the economic record of his predecessor's administration, pledged during the 2016 campaign to double growth to 4 per cent or better.

Democrats claim Trump is merely enjoying gains prompted by Obama since some of the positive trends started towards the end of his presidency.

The BEA previously found that economic growth increased at an annual rate of 2.2 percent during the first quarter of 2018, based on the Gross Domestic Product (GDP).

At an event on Thursday, Trump said of the GDP number, "If it has a 4 in front of it, we're happy". The success of his gamble will ultimately be determined not by whether growth accelerates, but whether the additional growth pays for or exceeds the $1.5 trillion cost of the cuts.


However, the Council of Economic Advisers Chairman Kevin Hassett said recent growth set the stage for a stronger economy in the second half of the year. And since this increase was driven by trade-war fears (as opposed to an explosion in global demand for tofu), soybean exports will likely fall dramatically in the coming months - and bring U.S. GDP down a bit with them.

Economists say the spike is coming mainly from a fluke: There was an unusually large increase in exports in the spring that probably came because other countries were trying to buy USA goods before Trump's trade war escalated and tariffs kicked in.

Consumer spending grew 4 percent, more than expected, while nonresidential business investment climbed at a pace of 7.3 percent. Government spending grew solidly, boosted by defense outlays. In other words, can the economy keep growing so strongly in the months and years ahead? He said the economy is on track to reach an annual growth rate of more than 3 percent. In 2019, he expects a solid 2.6 percent growth rate.

"Business investment is booming", White House Chief Economic Advisor Larry Kudlow said after thanking the President for his leadership".

Price data in the report indicated that inflation was in line with the Fed's goal.

The GDP report released Friday included a benchmark revision of the past GDP numbers. It followed first-quarter growth of 2.2 percent that was revised from 2 percent, the Commerce Department reported Friday.

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