My Forecast: More Predictions From More Experts
When I read the following headline in the Wall Street Journal,
“The Economic Forecast for 2019: Less Growth and More Uncertainty,”
I considered it absolutely hilarious because it could just be recycled year after year, especially the part about uncertainty. On the news on Tuesday they blamed the stock market drop on uncertainty. I guess there was no uncertainty when the market rose on Monday and last week.
Here is what the article says creates the uncertainty:
Among the big questions: What will the Fed do? And what impact will President Trump’s trade policies have on business investment?
I continually read predictions and analysis by so called “experts” and I think: why do we call them experts since their predictions are usually so far off?
How many experts predicted Trump policies would give us over 3% growth this year? I can’t think of any. Instead we were continuously warned that if Trump was elected the economy and stock market would tank, so why should we believe their predictions today?
We were told that the economy could not grow this fast. We were also told that the manufacturing jobs could not be brought back.
I hear that the Federal Reserve is moving the Federal Funds rate nearer to a neutral rate. How the heck does anyone determine the “neutral” rate? Maybe they could also tell us what the correct value of the dollar vs the Euro, Yen and Yuan is. It continually fluctuates. What is the correct value of soybeans, corn and oil? What is the correct value of Apple, Google, Facebook and Netflix? I heard that Goldman Sachs changed their target price on Apple twice in one week. It certainly makes price targets look worthless if they constantly change based on trading.
I believe the Federal Reserve uses inflation to determine interest rates. It should be noted that inflation is different for people at different ages and at different locations. There is no way that inflation in rural and mid-size communities is the same as in San Francisco and New York but they calculate inflation as a whole. Older people rarely have kids in college, buy houses or cars but inflation uses all components to calculate inflation and then puts out statistics that says real wages aren’t rising. We all do buy food, gas and utilities and those prices are stable or going down at the current time.
I have heard that the Federal Reserve is raising rates so that when we have a downturn they have more room to lower them to combat the recession. That is one of the stupidest things I have ever heard. The Federal Reserve raises rates and that harms home prices and sales, harms businesses, harms commercial property prices and sales, harms car sales and prices, and harms stock and bond prices. Then after they cause the slowdown they then correct. Why don’t they slow the increases instead?
Trump has done several things to help keep inflation in control while goosing the economy substantially, but the so called “experts” seem to have tunnel vision and haven’t noticed the effect. His reduced taxes and regulations would lower inflation on families and businesses. The economy is growing much faster than projected, and that would increase productivity and lower potential inflation. He has given back freedom of choice on health insurance and that has somewhat stabilized prices. Trump has opened up drilling which should help control transportation and utility costs. If companies aren’t sending the government so much for taxes and spending so much to comply with regulations, they can keep prices lower and raise wages more without causing runaway inflation.
I think of many other projections or predictions that have been 100% wrong. Think of how many times we have been warned about the dire consequences from humans, fossil fuels and CO2. The predictions of disaster with a deadline have been 100% wrong and yet they are repeated over and over again. We have been told repeatedly that we were running out of oil and we couldn’t feed all the people. The predictions were 100% wrong yet we keep hearing the warnings.
Basically, always question the supposed “experts.” They make up lots of stuff.
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