Beacon Economics Releases Outlook on The Economic Impact of the 2nd Trump Administration
Billionaire Advisors May Curb Tariff Threats;
Massive Federal Deficit, Overheated Markets Are Unsustainable, Ignored
LOS ANGELES, Jan. 16, 2025 /PRNewswire/ -- From tariffs to tax cuts to deportations, questions have swarmed in about how the new Trump administrations' policies will affect the nation's current economic expansion. According to Beacon Economics' latest outlook for the U.S. economy, the real risk of Trump's second term won't come from what he does but from what he doesn't do.
FROM THE LATEST OUTLOOK
- President-elect Donald Trump will be taking the helm of a nation on a solid economic growth trajectory.
- In the short run, his policies will likely amplify economic growth trends, but at the expense of intensifying unsustainable imbalances:
"Clearly, dealing with the nation's deficit and growing asset bubble should be a central focus of any new administration—and just as clearly, they won't be," said Christopher Thornberg, Founding Partner of Beacon Economics and the outlook's author. "Biden's administration didn't tackle these crises-in-the-making and there is no indication Trump will either." - Although President-elect Trump threatened tariffs of 25% across the board during the campaign, his inner circle are likely to act as restraints on those proposals:
"A 25% across the board tariff would almost certainly set off a damaging trade war," said Thornberg. "But Elon Musk, who has the President-elect's ear at the moment, could surely do without that kind of disruption given the global supply chains his many businesses rely on. Scott Bessent and Howard Lutnick have also been appointed to important government positions, and as members of the finance industry, they have little interest in rocking the economic boat." - U.S. real GDP averaged 3% growth through the first three quarters of 2024 and preliminary data for the 4th quarter suggests the same momentum.
- The nation's economic growth has been driven by the strength of U.S. household: Over the past five years, hourly earnings in the U.S. have grown more per year (4.8%) than consumer prices (3.7%).
View the new The Beacon Outlook United States including full forecast tables here.
Beacon Economics LLC is an independent economic research and consulting firm based in Los Angeles. Learn more at www.BeaconEcon.com
Contact: Victoria Pike Bond
Phone: 415-488-7195
Email: Victoria@BeaconEcon.com
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SOURCE BEACON ECONOMICS