American Economic Sentiment Riding High

Many believe the trade war talk to be just that, talk. There is little if any damage being done. While I agree that it is more likely a trade war will not happen, I falter at the anti-free market lunacy of the current POTUS. Can you not handle trade negotions with negotiations? We are not building a condomimim complex. POTUS is  putting economics in the hands of political economists, or whatever you’d like to call them...Men who use the science and art of economics to propel partisan rhetoric. What a crime! I will say that when politics die, they are generally destroyed. When these days vanish we will be in a much better place. There is no room for polite society inside   state run propaganda and US media. 

Fathom Consulting: Our US Economic Sentiment Indicator (ESI) may have slipped from 6.8% to 6.3% in March, but this was still one of the highest readings in 21 years. This comes in spite of growing fears of a trade war between the US and China, which many suggested would dampen sentiment and economic activity. Some of these fears may yet be reflected in the ESI reading for April, since some survey responses for March will have been submitted before China-specific tariffs were announced on 22 March.  However, fears of a trade war first surfaced in February, when the US announced tariffs on steel and aluminium imports, and there is no sign that this had a material negative effect on business and consumer sentiment last month. Even if a trade war is avoided, as we anticipate, we do not expect such bullish business and consumer sentiment to be maintained indefinitely — hard and soft measures of economic activity are likely to converge later this year.  Given the Q1 data released so far, official GDP growth looks likely to have been 1.5-2.0% (annualized). We have therefore revised down our forecast from 2.6% to 1.7%. However, GDP growth in Q1 has been systematically lower than growth in other quarters since 2000 and we do not think that this marks a slowdown in underlying economic activity; we expect growth to bounce back in Q2.

- Thank you Fathom Consulting 

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