Increased U.S. growth and stock market gains coming. The reason? Trumponomics.

[Deleted]

[Note: After all the panic-mongering, I'm just amazed at the surge of optimism after Trump's election, it's rather disturbing ]

http://money.cnn.com/2016/11/29/news...conomy-stocks/



Trumponomics suddenly gets big Wall Street thumbs up

Donald Trump's economic plans are suddenly getting gold stars on Wall Street.

Big banks such as Bank of America (BAC), UBS (UBS) and HSBC (HSBC) are bumping up their predictions for U.S. growth and stock market gains. The reason? Trumponomics.

"Following Donald Trump's election victory, we have altered our GDP forecasts as we are now expecting a modest fiscal stimulus from lower tax rates and higher government spending," wrote HSBC chief U.S. economist Kevin Logan in a recent report.

It's a stunning reversal from the days before the election when economists and market experts at many Wall Street banks were forecasting dire consequences -- a recession and a swift market drop -- if Trump were elected president.

Now many are saying the opposite: Trump is good for growth.



"Well-executed U.S. fiscal policy could boost growth substantially," says Don Rissmiller of investment firm Strategas. Rissmiller predicts GDP growth could be a full 1% higher in 2017 and 2018.

The U.S. has been expanding at a pace of about 2% a year. Trump vows to get America to 4%.

The stock market has surged to record levels after Trump's election. Investors cheered his promises of massive tax cuts for individuals and businesses, a rollback on onerous regulations and up to $1 trillion of new government spending on roads, bridges and other infrastructure.

The Dow is up over 5% this month, and comes after three months of losses.



"The market has sailed through some of this year's biggest shocks (U.K. Referendum, U.S. election)," wrote the Bank of America Merrill Lynch team in a recent report. The team raised its forecast for the S&P 500 index to end the year at 2,100, up from 2,000.

On top of the tax cuts, investors also like the idea of giving big businesses like Apple (AAPL, Tech30) a tax discount to bring the cash they have stashed overseas back to the United States. That money coming back could be spent on companies buying up more stock, which would further boost prices.



But Wall Steet's newfound love for Trumponomics comes with a big asterisk: Trump can't get too protectionist on trade and immigration.

Wells Fargo (WFC) put it this way: "Tax cuts and additional federal spending could stimulate economic growth, but tariffs and restricting immigration may slow the economy. These policy prospects create potentially offsetting effects." Due to the trade concerns, Wells Fargo hasn't hiked its GDP forecast. However it does expect higher inflation.

Mitt Romney -- now under consideration to be Trump's Secretary of State pick -- was one of many business leaders who slammed Trump for his plans to place hefty taxes on Mexican and Chinese goods coming into the U.S. Romney even said Trump's trade ideas would send the nation careening into a recession.
Trump's plan for his first 100 days in office includes "renegotiating" or "withdrawing" from NAFTA and labeling China a "currency manipulator." It's unclear how far he will go.



Here's a rundown of who's lifted forecasts and what they're saying:

Bank of America Merrill Lynch: "Our 2016 year-end target shifts to 2,100 from 2,000 previously."

HSBC: We are raising our GDP forecast for 2017 to 2.3% from 2.1% in anticipation of a boost to consumption spending. The stimulus effect should be larger in 2018 as the full impact of tax cuts affects household finances. We forecast GDP growth in 2018 to average 2.7%, up from our previous forecast of 2.2%."

UBS: "U.S. GDP is likely to accelerate next year...A new fiscal policy regime -- corporate and household income tax cuts -- may further contribute to broader GDP growth although there's obviously uncertainty around new policy as well as an important drag from uncertainty around trade policy."

Capital Economics: "We now expect GDP growth to accelerate to 2.75% next year (up from 2%), with CPI inflation climbing toward 3%."

Yardeni Research: "In Trump World, pressure on profits could be very bullish for stocks thanks to over $2 trillion in repatriated cash and a significant cut in the corporate tax rate! That's a new reality for sure."

Strategas: "A key message of the market recently has been: Something is going to get done. Single-party government matters. It is possible that well-executed U.S. fiscal policy could boost growth substantially (1%+ on GDP) in 2017-18. Corporate earnings should benefit."

[Elegiac]

Market confidence is apparently the same thing as the concrete impacts of economic policy.

[alexw]

http://money.cnn.com/2016/11/29/news...conomy-stocks/

Trumponomics suddenly gets big Wall Street thumbs up

Donald Trump's economic plans are suddenly getting gold stars on Wall Street.

Big banks such as Bank of America (BAC), UBS (UBS) and HSBC (HSBC) are bumping up their predictions for U.S. growth and stock market gains. The reason? Trumponomics.

"Following Donald Trump's election victory, we have altered our GDP forecasts as we are now expecting a modest fiscal stimulus from lower tax rates and higher government spending," wrote HSBC chief U.S. economist Kevin Logan in a recent report.

It's a stunning reversal from the days before the election when economists and market experts at many Wall Street banks were forecasting dire consequences -- a recession and a swift market drop -- if Trump were elected president.

Now many are saying the opposite: Trump is good for growth.



"Well-executed U.S. fiscal policy could boost growth substantially," says Don Rissmiller of investment firm Strategas. Rissmiller predicts GDP growth could be a full 1% higher in 2017 and 2018.

The U.S. has been expanding at a pace of about 2% a year. Trump vows to get America to 4%.

The stock market has surged to record levels after Trump's election. Investors cheered his promises of massive tax cuts for individuals and businesses, a rollback on onerous regulations and up to $1 trillion of new government spending on roads, bridges and other infrastructure.

The Dow is up over 5% this month, and comes after three months of losses.



"The market has sailed through some of this year's biggest shocks (U.K. Referendum, U.S. election)," wrote the Bank of America Merrill Lynch team in a recent report. The team raised its forecast for the S&P 500 index to end the year at 2,100, up from 2,000.

On top of the tax cuts, investors also like the idea of giving big businesses like Apple (AAPL, Tech30) a tax discount to bring the cash they have stashed overseas back to the United States. That money coming back could be spent on companies buying up more stock, which would further boost prices.



But Wall Steet's newfound love for Trumponomics comes with a big asterisk: Trump can't get too protectionist on trade and immigration.

Wells Fargo (WFC) put it this way: "Tax cuts and additional federal spending could stimulate economic growth, but tariffs and restricting immigration may slow the economy. These policy prospects create potentially offsetting effects." Due to the trade concerns, Wells Fargo hasn't hiked its GDP forecast. However it does expect higher inflation.

Mitt Romney -- now under consideration to be Trump's Secretary of State pick -- was one of many business leaders who slammed Trump for his plans to place hefty taxes on Mexican and Chinese goods coming into the U.S. Romney even said Trump's trade ideas would send the nation careening into a recession.
Trump's plan for his first 100 days in office includes "renegotiating" or "withdrawing" from NAFTA and labeling China a "currency manipulator." It's unclear how far he will go.



Here's a rundown of who's lifted forecasts and what they're saying:

Bank of America Merrill Lynch: "Our 2016 year-end target shifts to 2,100 from 2,000 previously."

HSBC: We are raising our GDP forecast for 2017 to 2.3% from 2.1% in anticipation of a boost to consumption spending. The stimulus effect should be larger in 2018 as the full impact of tax cuts affects household finances. We forecast GDP growth in 2018 to average 2.7%, up from our previous forecast of 2.2%."

UBS: "U.S. GDP is likely to accelerate next year...A new fiscal policy regime -- corporate and household income tax cuts -- may further contribute to broader GDP growth although there's obviously uncertainty around new policy as well as an important drag from uncertainty around trade policy."

Capital Economics: "We now expect GDP growth to accelerate to 2.75% next year (up from 2%), with CPI inflation climbing toward 3%."

Yardeni Research: "In Trump World, pressure on profits could be very bullish for stocks thanks to over $2 trillion in repatriated cash and a significant cut in the corporate tax rate! That's a new reality for sure."

Strategas: "A key message of the market recently has been: Something is going to get done. Single-party government matters. It is possible that well-executed U.S. fiscal policy could boost growth substantially (1%+ on GDP) in 2017-18. Corporate earnings should benefit."

Lol. Yes what is good for wall street is good for main street. Every time share prices boomed from rocketing corporate profits via wage suppression, the average person benefited via their multi-million dollar stock portfolio's. It's 100% guaranteed to happen again this time.

[Deleted]

Market confidence is apparently the same thing as the concrete impacts of economic policy.

We've had slow and uneven global growth for 8 years (under Obama, etc) along with a rising bubbly stock and real estate market

Now economists and analysts are predicting an increase in growth due specifically to Trump's actual policies

This is not about the stock market - this is about actual growth

[NED funded]

Most of these models are based on the assumption that Trump will spend, spend, spend, boosting growth and inflation, but not successfully act against free trade. Which is good for a short uptick, however it's worth mentioning that the fed does not recommend this type of spending as it would only run up the debt even more and we are not in a position of doing this because in the long run should we require fiscal stimulus to actually saves us from financial trouble we wouldn't be able to do so. Also so much for the party of fiscal responsibility.

I wonder though how they have modeled any Fed rate movements. I would bet that Yellen will move any rate increases forward based on Trumps plan.

[Elegiac]

We've had slow and uneven global growth for 8 years (under Obama, etc) along with a rising bubbly stock and real estate market

Now economists and analysts are predicting an increase in growth due specifically to Trump's actual policies

Which haven't been elaborated to any concrete degree or, you know, implemented.

This is not about the stock market - this is about actual growth

Cool. Let me know what the predictions on median household income are.

[Cthulhu 2020]

"HILLARY IS IN BED WITH WALL STREET, DRAIN THE SWAMP!"

"Trump will be amazing for banks and wall street!"

Yeah guys, we TOTALLY drained the swamp.

- - - Updated - - -

Which haven't been elaborated to any concrete degree or, you know, implemented.



Cool. Let me know what the predictions on median household income are.

I just LOVE how these people were scolding OWS people as being dumb welfare kids, then when Hillary was running supporting wall street was TERRIBLE AWFUL OMG SUPPORT TRUMP HE'S ANTI BANKS ANTI WALL STREET.

Then... this.

[Cyberowl]

We've had slow and uneven global growth for 8 years (under Obama, etc) along with a rising bubbly stock and real estate market

Now economists and analysts are predicting an increase in growth due specifically to Trump's actual policies

This is not about the stock market - this is about actual growth

The stock market is NOTHING but expectations, cmon Xarim. Expansive fiscal policies increase expectations, this is as basic as it gets.

[PC2]

Yeah there is healthy optimism. The people fear mongering about Trump and Brexit were being melodramatic.

[Elegiac]

Yeah there is healthy optimism. The people fear mongering about Trump and Brexit were being melodramatic.

Because there weren't market dips when Trump was elected and Brexit passed, right.

[Cthulhu 2020]

Because there weren't market dips when Trump was elected and Brexit passed, right.

The full economic consequences of both will be felt in probably 2-6 years. Both the freak outs and optimism are purely fabricated by human delusions.

[zenkai]

The market at the moment is optimistic, but things can change if he doesn't do what they want. A lot of market swings is based on faith.

[GennGreymane]

But he hasnt done anything yet......

[Deleted]

The full economic consequences of both will be felt in probably 2-6 years. Both the freak outs and optimism are purely fabricated by human delusions.

It's simple math, and I am terrible at that.

If more money comes in than goes out then your country wins.

[Dezerte]

I guess he can resign now.

[Sunseeker]

I really don't give two shits what the stock exchange does. It has absolutely zero bearing on how the people who voted for Trump are doing.

[Deleted]

The denial is strong in this thread I see

The point is simple: his economic policies are a surprise hit with analysts and economists

Turns out - he was the one with the visionary economic plan, not Hillary - and now the consensus has shifted to: he was right all along

The same economists and analysts who were celebrating Hillary and mocking trump have done a complete 180

[Deleted]

Excuse my lack of enthusiasm but we are talking about the same stock market that goddamn crashed itself with greed, not even a damn decade ago, and now we are supposed to take their enthusiasm and predictions for Trumponomics as a positive?

[Hothgor]

Government spending accounts for nearly 1/4th of GDP. Of course an increase in spending will boost GDP. To bad about the accompanying deficits. Oh wait, those only matter when a Democrat is in office.

[Release]

The denial is strong in this thread I see

The point is simple: his economic policies are a surprise hit with analysts and economists

Turns out - he was the one with the visionary economic plan, not Hillary - and now the consensus has shifted to: he was right all along

The same economists and analysts who were celebrating Hillary and mocking trump have done a complete 180

Are you for real? When he has implemented this policy long term is when you can make that conclusion. Also the article doesn't mention all these tax cuts from where? Education, the military, the environment, NASA? Great wall street might get richer which is exactly what the right was accusing Hillary off isn't it? Being in it just for big business?