by Rod D. Martin
August 2, 2017
The stock market hit 22,000 this morning, up 20% since Donald Trump’s election — a market leading leftist economist and New York Times columnist Paul Krugman said would “never recover” if Trump won. Why? The strongest earnings, lowest unemployment (read: fast new job creation), highest wages, most rapid economic growth, and strongest consumer confidence in a decade, well before Barack Obama.
People are investing again. And spending again. And have hope again. And have reason for hope again.
Naysayers think this is a bubble, but it isn’t. Greenspan is right that the bubble is in bonds, not stocks, due to a Fed that’s suppressed interest rates far too long.
But ignore all that: here’s your key takeaway, as I’ve been telling you since November. The rapid upward correction (yes, correction) in stocks is the result of removing the weight of Obama and Clinton from the economic equivalent of a spring. The market had long since priced in anemic economic growth, continued job loss, lower wages (and a flood of illegal aliens pushing wages downward), and an ever spiraling regulatory and tax burden that made new investment unattractive if not outright foolhardy.
On November 8th, that weight was lifted off the spring.
Now, just imagine how much higher that spring might bounce if Congress did it’s job too, enacting Donald Trump’s truly transformative tax plan and real repeal and replace.