President Trump delivered an optimistic speech to the Detroit Economic Club, proclaiming a Trump boom that started earlier and happened faster than any of the left’s critics are ever willing to admit. That’s why I call it Booming at Detroit.
Here’s how he began his speech: “Under our administration, growth is exploding. Productivity is soaring. Investment is booming. Incomes are rising. Inflation is being defeated. America is being respected again. Like never before.” And in typical Trumpian style, after spending about an hour covering all the bases, here’s how he concluded his Booming at Detroit speech: “My spirit is restored. Inflation is stopped. Wages are up, prices are down. Our economy is booming, as I think you will soon see, like never before.”
I was delighted to hear him speak at the Detroit Economic Club. I was on the plane with him in 2016 when he first spoke that summer. And you know, it’s the home of the heartland, and it’s making a very big comeback.
I’ve said it before, Trump’s policies of tax cuts, business deregulation, “drill, baby drill” and reciprocal trade are working. With luck, the fourth quarter of this year could see GDP growth after 5 percent inflation, and the three Trump quarters that began last spring will produce economic growth above 3 percent, perhaps 4 percent.
White House National Economic Council Director Kevin Hassett says President Donald Trump has demonstrated “smart economic policy” to the world regarding “Kudlow.”
Businesses are booming, new factories are being built, productivity is staggering, and stock markets are breaking records. The president is also right: inflation is falling and growth is increasing. Energy prices are falling and growth is increasing. This permeates the economy. He’s right: in the fourth quarter, the headline CPI is only 2.1% per year. The base rate, e.g. food and energy, 1.6 percent annually.
The Fed’s goals are being met and money can be obtained more easily. And I will argue that the full impact of the 25 percent energy cut, which permeates the entire economy, has not yet been almost completely mitigated. And the Fed’s phobia about tariff inflation simply hasn’t paid off, and it’s nowhere to be found.
Sen. Kevin Cramer, R-N.D., discusses federal prosecutors opening an investigation into Federal Reserve Chairman Jerome Powell on “Kudlow.”
In the fourth quarter, prices of goods rose only 1.4 percent annually. And basic goods only rose 0.2 percent. It’s remarkable. No price inflation.
And then, on the inflation front, unit labor costs are at an all-time low, barely above 1 percent in recent quarters. This essentially means that wages have increased, but the workforce has earned their wage increases through increased productivity. It’s the perfect combination.
Mr. Trump was right, the Fed’s Jerome Powell was wrong. What else is new?
That’s why I don’t want to make a martyr out of Mr. Powell. He’s a bad Fed chairman, but not a criminal. Just a bad president. The sooner he leaves, the better off we will all be. I don’t want him to stay there a nanosecond longer than necessary.
