President Trump Delivers a Stronger Economy as Promised

Donald Trump

Obama supporters clapped and cheered then just as hard as Trump supporters are clapping and cheering now.

Ahead of the release, President Donald Trump and members of his economic team had been promoting the notion that second-quarter growth would be robust. Few economists outside the administration agree with this claim.

Jason Furman, who served as chairman of the Council of Economic Advisers under Obama, wrote in Vox that same month that Trump's growth projections were unrealistic given the fact that Americans are getting older. "This is no one-shot deal", said Kudlow.

Unlike in 2015, growth has accelerated this year, in part, because of the stimulus from Mr Trump's deficit-funded tax cuts. The data show that the falling unemployment rate and gains in home values reflect the duration of the recovery, rather than any major changes made since 2017 by the Trump administration.

But Friday's announcement that the economy grew at a 4.1% pace in the second quarter, the best showing since 2014, is genuine cause for celebration. Of course, GDP figures can be subject to big fluctuations from one quarter to another. Some economists think full-year growth in gross domestic product could hit 3 percent in 2018 for the first time in the almost decade-long recovery, a prospect that became more likely following Friday's strong numbers.

The 4.1 percent rate was the best since the third quarter of 2014.

Meanwhile core PCE prices, a measure of inflation, grew 2% quarter-on-quarter, less than expected and a slight deceleration from the 2.2% pace of price growth seen to start the year.

Both of those factors are largely beyond Trump's control.

However, she said the trends in the housing market, as well as the one-off boost in exports in the most recent quarter, call "into question the sustainability of above-trend topline growth looking out to the second half of the year".

The president has been floating plans to slap import taxes on hundreds of billions of dollars of foreign goods, which has led to the risk of retaliatory tariffs by foreign companies on USA goods.

Note, too, that the trade war with the European Union is on hold and that the future for soybean exports now seems rosy (elsewhere, the Post, borrowing from Nancy "Crumbs" Pelosi's play book, writes off this good news as "beans").

"The second quarter was a strong quarter, but it was juiced up by the tax cuts and higher government spending", said Mark Zandi, chief economist Moody's Analytics. Mr. Trump expressed hope that the figures would be good on Thursday as he spoke to steelworkers in Granite City, Illinois, saying, "if it has a four in front of it, we're happy".

Even with the relatively strong pace of growth last quarter, most economists expect expansion to settle back to near its long-run rate, and some have flagged the risk of a recession in two years. Government spending also posted a solid gain, rising at a 2.1 percent annual rate.

It's also more than double the 2 percent annualized growth reported in 2018's first quarter. Get too ambitious in your promises, and you could suffer a devastating miss (see: "If you like the plan you have, you can keep it").

"We were abused like no nation has ever been abused on trade before because we had nobody watching".

The revisions also showed the economy surpassed $20 trillion in nominal dollars in the first quarter.

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