“I am Yahweh; that is My Name! I will not give My glory to anyone else, nor share My praise with carved idols.” (Isaiah 42: 8)
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The U.S. Economy in 2018 should Surprise to the Upside
Barring unforeseen circumstances, the U.S. economy is poised to takeoff. Here’s why:
- President Trump’s tax cuts will put lots of money into people’s hands.
- Repatriation of cash holdings of U.S. companies in foreign countries is a big deal. We don’t know exactly how much cash will be coming home, but we know that it’s at least $3 trillion and may be as much as $5 trillion. That much new cash entering our market will impact the U.S. economy significantly.
- The increase in defense spending is a big deal, too. Besides the obvious benefits, increasing defense spending leads to rapid technological developments. They will propel the economy for many years to come.
- Increasing infrastructure spending will create lots of new jobs, increase consumer discretionary spending, and lift inflation and interest rates. The result will be a burgeoning economy.
- Allowing companies to expense capital investments in the year they are made will result in capital spending on a scale that I have not seen in my lifetime. It will lift asset values in every asset class. People who don’t understand economics miss the significance of this aspect of the tax bill.
- Removing repressive and unnecessary regulations will grease the skids. That’s happening already.
- We are in the midst of a synchronized global economic boom. Barring unforeseen circumstances, that won’t change in the next 12 months.
- Domestically, U.S. citizens are holding more than $10 trillion in cash and near cash assets. Some of that money will be drawn into the market as the economy picks up a head of steam because interest rates are so low.
The Good News
By itself, any one of those things is enough to give a boost to the U.S. economy. Together, they should launch it into orbit.
The Bad News
During economic prosperity,
- people tend to buy things they don’t need;
- they tend to pay more for things than they should; and
- they tend to take on debt to buy more than they can afford because the think the good times will never end.
But the good times do end. When they end, they end abruptly, and many people are caught unawares. They find themselves between a rock and a hard place.
My Advice
I don’t know how long the good times will last, but I do know this:
- Now is not the time to spend.
- Now is the time to save and invest.
- The best time to spend is when the economy is weak. That day is coming.
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“The glory which You have given Me I have given to them, that they may be one, just as We are one; I in them and You in Me, that they may be perfected in unity, so that the world may know that You sent Me, and loved them, even as You have loved Me. Father, I desire that they also, whom You have given Me, be with Me where I am, so that they may see My glory which You have given Me, for You loved Me before the foundation of the world.” (John 17: 22-24)
See “His Name is Yahweh”.
