Don't be fooled by the strong US growth figures this quarter.

This is the growth Trump is boasting about. Hardly spectacular, especially considering the future he is mortgaging and the reputational capital he is squandering to achieve it. Just remember:

·         GDP is naturally volatile. Obama achieved growth this high too – around four times. So individual quarters mean virtually nothing;

·         Soybean exports jumped an annualised 3,000% in the race to beat retaliatory tariffs this quarter (adding around 0.6% to growth figures), and will probably plummet soon thereafter;

·         Similarly, a lot of other companies stockpiled raw materials, intermediate goods and finished goods before tariffs kicked in;

·         Any ‘sugar high’ from the tax cuts will be short lived with long term consequences for government debt and economic inequality;

·         Wage growth is still stubbornly flat.

I know this sounds pessimistic, but I also know Trump is going to try to claim vindication from these numbers. And I’m terrified people will believe him.

The trade war is not working. And the binge the US is on right now is leading up to a whopping great big hangover. Stock up on aspirin.

https://www.washingtonpost.com/opinions/the-economys-great-that-doesnt-mean-trumponomics-is/2018/07/26/2327dd6e-910c-11e8-bcd5-9d911c784c38_story.html?noredirect=on&utm_term=.3c018d4f94fa