Today, the IMF released forecasts of substantially downwardly revised growth estimates for the US. UK 2017 growth revised down 1.1 percentage points relative to pre-Brexit forecast (World Economic Outlook).
The Wall Street Journal reported on Thursday:
OPEC said its members agreed that they need to cut crude output to reduce the world’s supply glut, a shift for the 14-member group that was enough to send oil prices higher, even though reaching a deal remains far from certain.
Members of the Organization of the Petroleum Exporting Countries said they reached an understanding after a six-hour gathering in the Algerian capital, but deferred until November the fraught task of finalizing a plan to make those cuts. OPEC officials said a committee would be formed to determine how much each country would have to cut and then report to the group at its next meeting on Nov. 30 in Vienna.
At the beginning of the week (9/27), Bruce Bartlett forwarded me a link to a remarkable document, entitled “Scoring the Trump Economic Plan: Trade, Regulatory, & Energy Policy Impacts” (strangely, dated 9/29), coauthored by Peter Navarro* and Wilbur Ross. I’m way behind the curve, and there have been numerous examinations of the document, so I will not discuss the entire paper. Rather I’ll focus on the following specific question: would renegotiating trade agreements and slapping tariffs on China, conjoined with the Trump fiscal policy, induce a drastic change employment and trade flows? The short answer — yes, but probably in a direction opposite of that posited by the authors.
The Philadelphia Fed today released leading indices for the 50 states and the US. Kansas records the largest projected six-month decline in activity (after recording the largest in the Nation three month decline through August).
In the debate on Monday, Donald J. Trump comments on Nafta’s impact:
You go to New England. You go to Ohio, Pennsylvania. You go anywhere you want, Secretary Clinton, and you will see devastation where manufacturing is down thirty, forty, sometimes fifty percent — NAFTA is the worst trade deal maybe ever signed anywhere but certainly ever signed in this country.
Earlier on, Moody’s Analytics took on the task of determining the likely impact of implementing the Trump economic pronouncements (tax cuts for the wealthy, massive deficit spending, increased defense spending, spending cuts on other discretionary components, and revocation of free trade agreements). Oxford Economics has taken up the task of evaluating the more recent incarnations of his pronouncements (to call it a “plan” is giving it too much credence).