Self-interested Wall Street analysts and leftist economic ‘experts’ once again proven wrong. It is almost impossible to find any financial data review written objectively by media. Everything is skewed with a negative tone, yet the data clearly shows -just like 2017- President Trump’s MAGAnomic policy benefits are starting to surface.
News pundits said President Trump’s tariff policies would skyrocket prices. In reality the yearly inflation rate [BLS data] has dropped to 2.1%, the lowest in four years. Core prices (removing food and energy) rose 2.5% from a year earlier, below the March figure of 2.7%, and the lowest in more than four years.
Meanwhile personal incomes tripled expectations coming in at 0.8% for the month of April. “Personal income surged 0.8% well ahead of the forecast for 0.3%.” Then comes the predictable. The trade deficit dropped by 46% in the month of April.
[…] The goods trade gap contracted 46.0% to $87.6 billion last month, the Commerce Department’s Census Bureau said on Friday. Goods imports decreased $68.4 billion to $276.1 billion. Exports of goods increased $6.3 billion to $188.5 billion. (source)
Companies front-loaded their orders from China in February and March, causing imports to skyrocket and a massive skew in the GDP data. As expected in April there are fewer orders because the goods were already received in the first quarter, imports drop in half.
Despite increased tariffs we are likely to see a replay of pricing parity similar to 2017 as companies benefit from lowered energy prices, lower fuel costs, lower Transporation and lower warehousing costs. Simultaneously, export companies who rely on access to the U.S. market will attempt to offset any tariff price as applied. Those combined savings can, likely will, offset increased tariffs on arriving goods.
Consumers benefit from lower gasoline costs, lower overall electricity costs and increased demand for labor within a growing economy that puts natural upward pressure on wages.
SUMMARY of Friday: Personal income jumped 0.8% this month, tripling expectations. The US trade deficit has been cut almost in half, the largest single-month narrowing of the deficit on record. U.S. core inflation falls to the lowest level in 4 years. The Supreme Court gives President Trump the green light to reverse Biden’s immigration influx of Venezuelans/Cubans/Haitians/Nicaraguans. And Volkswagen announced they are making a “massive” investment in the U.S to avoid tariffs.
(NY POST) – Volkswagen is holding “fair” and “constructive” talks with the United States government on tariffs and wants to make further investments in the country, CEO Oliver Blume told German newspaper Sueddeutsche Zeitung.
Several foreign companies have announced new US investments in response to President Donald Trump’s import tariffs, but German carmakers have been more cautious about committing more resources to what is their biggest export market.
Volkswagen’s Audi brand, which has no production in the United States, is planning to produce some models in there, although the brand has said that the plan pre-dates the Trump administration. (link)
