Why Trump Deserves All the Credit for the Current State of the Economy

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Why Trump Deserves All the Credit for the Current State of the Economy

If you’re the kind of person who gives credit to former President Obama for the current state of the economy then you’re either delusional or completely misinformed.

Let’s backtrack to when Obama took office in early 2009 – he inherited two wars and a crumbling economy, slowly but surely, the free market was undoubtedly repaired under the Obama administration, wiping away the mud on the proverbial carpet left by the George W. Bush Jr. administration.

But with that positive came an enormous negative with the outrageous debt that he incurred during his administration in the amount of approximately $9 trillion. Now, there are multiple ways to analyze the complexity of debt through budget deficits and how the administration’s policies increased debt over time. The point is to subtract the debt levels between when the president arrived and when he left – meaning some would argue that Obama’s debt contribution was actually just shy of a trillion dollars – all of that being debatable depending on their bias.

One thing is usually absolute, however, when the incumbent president leaves office, that administration is responsible for any economic progression or regression in the first year.

But that’s not the case for President Trump.

It was irregular and certainly unusual. Many economists believed that a Trump win – remember he was a long shot to win – would be a massive blow to the market.

“Wall Street clearly prefers a Clinton win certainly from the prospective of equity prices,” said Dartmouth College’s Eric Zitzewitz, one of the authors of the new study along with the University of Michigan’s Justin Wolfers. “You saw Clinton win the first debate and her odds jumped and stocks moved right along with it. Should Trump somehow manage to win you could see major Brexit-style selling.”

“Obviously, stock investors and traders favor Hillary Clinton over Donald Trump because they prefer the known status quo rather than the alternative,” Ed Yardeni, president of investment advisory Yardeni Research, wrote in a note.

It’s true that when it came to Brexit the markets immediately responded when the U.K. decided to exit the E.U.

Zitzewitz also wrote, “In other words, a surprise Trump win would have about the same effect on global markets that Brexit had on UK markets. Many UK voters appeared surprised at the market’s immediate reaction to Brexit. Thanks to a few political shocks, we can measure the market’s expectations about the effects of the 2016 election in advance. Thus U.S. voters can go into the polling stations with their eyes open.”

The market did have an immediate response the next day when Trump pulled off the shocking upset against Democratic nominee Hillary Clinton. On the morning of November 9th, before the morning bells rung, the premarket trading showed major indexes were down. Both major markets were down about 2.5%.

The rest is history, right? Well, you would be wrong with that assumption because by the end of the day, the Dow was up. 1.4% and the S&P 500 up 1.11%.

On January 25th, 2017, only several days after Trump’s inauguration, the Dow hit 20,000 milestone for the first time ever. And just a few days shy of a year later, on January 4th, 2018, the Dow hit an astounding 25,000. Why do you think that was?

Do you think it was because the Obama administration’s slow and steady progress was responsible for this unprecedented surge or was it perhaps something, or someone, else?

The answer is undoubtedly Trump. Why? Three words: deregulation, deregulation, deregulation.

It’s important to remember that the stock market is more like a future performance barometer for public companies. They already knew that under the Trump administration gross over-regulation and taxes would be an enormous departure. So they invested and they even did so while Trump was still President-elect. That sudden surge wasn’t due to Obama’s already-implemented policies waiting to take hold – it was the sudden change of the guard – when investors put their money where their mouths were and bet on the current administration to eliminate the horrendous Trans-Pacific Partnership, bring jobs back and truly make America first. This current state of the economy isn’t Obama’s progress lingering from his administration’s policies; it was an instinct that Trump would finally deregulate his previous policies. And who better to do that then one of America’s wealthiest business-minded individuals?

Whether you want to admit it or not, it’s the truth.

~ By Michael Strong

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Michael Strong is a Christian, husband, father and grandfather of six. Strong is a Virginia native who has spent time in the Marine Corp at Quantico and many years as a defense contractor in Reston. He’s a proud conservative and hiking enthusiast.

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