The real economy - what the latest estimates for economic growth are & what it means for you:
Bottom Line: Last week I completed my first semi-meaningful economic evaluation of the Trump-era economy in the first quarter of 2017. My current estimate for economic growth was 2.1%. While that's better than the 1.6% economic growth rate from 2016, the 1.8% average growth rate of the Obama years in the 4th quarter of 2016... It demonstrated the work that must be done to breakout of the slow-growth economy we've been stuck in since 2005. As I mentioned in my research - I estimate the actual impact of Trump policy changes (all based on executive orders at the moment) is +.2% to date. I also indicated that to get back to 3%+ growth we're going to likely need meaningful pro-growth legislative policy changes. Clearly that's not coming from healthcare anytime soon. We're left to hope for tax policy that will move the needle for now.
With that as the backdrop yesterday we received the latest economic forecast from the National Association for Business Economics (the top 50 business economist's forecast) and they now estimate growth for 2017 at 2.3% and 2.5% for 2018. While those are improvements over what we've seen - they seem to imply what my initial findings have suggested (that it's going to take more than executive action to meaningfully breakout to the upside with economic growth). The good news is that some marginal positive momentum with economic growth does seem to be a near-certainty. So the downside appears to be better economic growth. That also means that there is a fair amount of upside if we do get that positive policy follow-through at some point. Fingers crossed that tax reform turns out better than the round 1 healthcare failure.