Wednesday, February 8, 2017
Roubini : Trump’s Market Honeymoon Ending
“To be sure, expectations of stimulus, lower taxes and deregulation could still boost the economy and the market’s performance in the short term. But, as the vacillation in financial markets since Trump’s inauguration indicates, the president’s inconsistent, erratic and destructive policies will take their toll on domestic and global economic growth in the long run,” Roubini wrote for Project Syndicate.
“It is little wonder that corporations and investors have been happy. This traditional Republican embrace of trickle-down supply-side economics will mostly favor corporations and wealthy individuals, while doing almost nothing to create jobs or raise blue-collar workers’ incomes. According to the non-partisan Tax Policy Center, almost half the benefits from Trump’s proposed tax cuts would go to the top 1% of income earners,” he wrote.
“Yet the corporate sector’s animal spirits may soon give way to primal fear: The market rally is already running out of steam, and Trump’s honeymoon with investors might be coming to an end. There are several reasons for this,” he wrote.
Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics