Even if Mickey Mouse were president, the US would still be on the way to 4 per cent growth because private-sector innovation promises to offset bad policies and erratic policymaking.
Last December, I argued that while some of US President Donald Trump’s policies would be stagflationary (reducing growth and raising inflation), such effects would ultimately be mitigated by four factors: market discipline, an independent US Federal Reserve, the president’s advisers, and the Republicans’ thin majorities in Congress.
The script has played out as predicted. The reaction from stock, bond, credit and currency markets forced Trump not only to back down from his “reciprocal” tariffs against most of America’s trading partners but also to beg China to sit down and negotiate.
Loading...
Nouriel Roubini is Professor Emeritus of Economics at New York University’s Stern School of Business and Chief Economist at Atlas Capital Team.
