IMF and Trump

This is funny. No, really, it is actually funny. Yesterday the International Monetary Fund (IMF) revised its outlook of the global economy. If you read the IMF prior “dire forecast” from July 17th –yes, only a week ago– you’ll discover the humor aspect.

The IMF is now upgrading their forecast of U.S. economic growth; and admitting -in essence- that President Trump’s America-First agenda is relocating global wealth back to the primary host nation known as the U.S.A. The increase in their forecast isn’t a small increase, it is essentially adding .3 percent (from 2.3% to 2.6%) or $60 billion more.

However, you’d have to go through two-thirds of the Reuters press coverage of the IMF release; and plow through a littany of doom and gloom; before you found this obscure reference: “The IMF raised its forecast for U.S. economic growth to 2.6% in 2019, but left its 2020 forecast for 1.9% growth unchanged.” Apparently the economic team at Reuters has a sad… harrumph!

Even the Washington Post, despite their earnest efforts, couldn’t actually put a negative spin on the new IMF projection:

(WaPo) The U.S. economy is growing even more rapidly than initially thought, the International Monetary Fund said Thursday, though it warned that President Trump’s trade war could slow momentum.

The U.S. economy is on track to expand by 2.6 percent this year, the IMF predicted, up from its April forecast of 2.3 percent growth. The increase is largely the result of a better-than-expected start to the year and the Federal Reserve signaling it is likely to lower interest rates.

“The revision to 2019 growth reflects stronger-than-anticipated first quarter performance,” the IMF wrote in its World Economic Outlook, adding that the Fed’s “dovish tilt” has “helped markets regain their poise.”
Last year, the U.S. economy grew at nearly 3 percent. The White House forecasts the nation will hit that level again, but the vast majority of independent economists predicts that growth will cool as the stimulus from the tax cuts begin to wear off. If the IMF projection is correct, it would still be a strong year. (read more)

OK…. So the IMF, which is euro-centric, increases the projected U.S. economic growth for 2019 to 2.6 percent. They then go on to warn everyone else, that globally the world economy is in a position of weakening, or shrinking etc; and you won’t be surprised at the reason for their negative global forecast. Of course it’s horrible Trump and his strategic trade reset that’s to blame. Grumble, grumble, grumble.

However, let me just remain focused on the U.S. growth projection for a moment…. We already know the 2018 U.S. GDP result was +3.1 percent. So it is worth looking back to 2017 and see what the IMF was projecting for the U.S. in 2018 to see their rate of accuracy:

July 24, 2017 – “The IMF now projects the U.S. economy will grow at a rate of 2.1 percent in both 2017 and 2018, it said in its July update to the World Economic Outlook. In its previous estimate issued in April, the organization predicted the U.S. economy would grow at 2.3 percent in 2017 and 2.5 percent in 2018.
“Over the next two years, U.S. growth should remain above its longer-run potential growth rate. But we have reduced our forecasts for both 2017 and 2018 to 2.1 percent because near-term U.S. fiscal policy looks less likely to be expansionary than we believed in April,” wrote Maurice Obstfeld, the IMF’s chief economist.” (link)

Whoopsie!

The IMF projected 2018 U.S. growth at 2.1% and the actual result was U.S. growth at 3.1%.
Not only did the IMF miss that projection ball-park, they missed the city and state where the ball-park was located. Missing a forecast for the worlds largest economy ($20 Trillion) by a full percentage point is like a geography expert standing on the equator and pointing North to identify the location of the South Pole. Yes, it is that ridiculous.
All of that said, the strength of the U.S. economy, and specifically the focused growth that is happening ONLY because U.S. President Donald Trump is directing our economy, is entirely an outcome of Trump policy that reverses decades of neglectful stewardship by prior politicians who controlled trade and economic policy.

What they did was purposeful.

Indeed, these MAGAnomic results are a big part of the reason why the globalists hate him.

Stocks jumped today on news that trade talks between U.S. and Chinese trade negotiators will resume next week. Stronger-than-expected earnings reports also gave the market a boost. The S&P climbed 0.69%, the Dow rose 0.66% and the Nasdaq, 0.58%. https://t.co/yuczqIdHl4 pic.twitter.com/S01EcE4EIx
— CNBC (@CNBC) July 23, 2019

In the bigger picture this is why President Trump is the most transformative economic President in the last 75 years. The post-WWII Marshall Plan was set up to allow Europe and Asia to place tariffs on exported American industrial products. Those tariffs were used by the EU and Japan to rebuild their infrastructure after a devastating war. However, there was never a built in mechanism to end the tariffs…. until President Trump came along and said: “it’s over”!

After about 20 years (+/-), say 1970 to be fair, the EU and Japan received enough money to rebuild. But instead of ending the one-way payment system, Asia and the EU sought to keep going and build their economies larger than the U.S. Additionally, the U.S. was carrying the cost of protecting the EU (via NATO) and Japan with our military. The EU and Japan didn’t need to spend a dime on defense because the U.S. essentially took over that role. But that military role, just like the tariffs, never ended. Again, until Trump.

The U.S. economy was the host for around 50 years of parasitic wealth exfiltration, or as most would say “distribution”. [Note I use the term *exfiltration* because it better highlights that American citizens paid higher prices for stuff, and paid higher taxes within the overall economic scheme, than was needed.]

President Trump is the first and only president who said: “enough”, and prior politicians who didn’t stop the process were “stupid” etc. etc. Obviously, he is 100% correct.

For the past 30 years the U.S. was a sucker to keep letting the process remain in place while we lost our manufacturing base to overseas incentives. The investment process from Wall Street (removal of Glass-Stegal) only made the process much more severe and faster. Wall Street was now investing in companies whose best bet (higher profit return) was to pour money overseas. This process created the “Rust Belt”, and damn near destroyed the aggregate manufacturing industry.

Fast forward to 2017 through today, and President Trump is now engaged in a massive and multidimensional effort to re-balance the entire global wealth dynamic. By putting tariffs on foreign imports he has counterbalanced the never-ending Marshal Plan trade program and demanded renegotiation(s). Trump’s goal is reciprocity; however, the EU and Asia, specifically China, don’t want to give up a decades-long multi-generational advantage. This is part of the fight.
One could argue that China’s rise happened inside this period, and as a consequence they have no comprehension of an economic history without the institutional advantages. They’ve never competed with the U.S. under any terms of equivelence or fairness; they’ve only ever known the advantages. Combine that with the Chinese communist mindset and you get the extreme severity of their position.

So yeah, there’s going to be pain – for them; massive economic pain – as the process of reestablishing a fair trading system is rebuilt. This dynamic is the essence of reciprocity that benefits Main Street USA. Unfortunately, putting ‘America First’ is now also against the interests of the multinationals on Wall Street; so President Trump has to fight adverse economic opponents on multiple fronts…. and their purchased mercenary army we know as DC politicians.
No-one, ever, could take on all these interests. Think about it… The EU, Asia, World Bank, International Monetary Fund, China, Russia, U.S. Chamber of Commerce, Iran, U.S. Congress, Democrats, U.S. Senate, Wall Street, the Big Club, Lobbyists, Hollywood, Corporate Media (foreign and domestic), and the ankle-biters in Never Trump…. All of these financial interests are aligned against Main Street USA and against President Trump.

Name one individual who could take them on simultaneously and still be winning, bigly.

They say he’s one man. They say they have him outnumbered. Yet somehow, as unreal as it seems, he’s the one who appears to have them surrounded.
Incredible.

Lord knows we can’t spare this man.

He fights!
.

…. And why we will keep on winning.

IMF and Trump - read

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