Every: Take Trump Seriously

Rabo Monthly Outlook

Punchy not drunk

Authored by Michael Every

President Trump may be infamously teetotal, but markets are punch-drunk from his sweeping changes via executive order. They can get more punch-drunk yet.

The House of Representatives has passed a budget plan which includes $4.5 trillion in tax cuts and $2 trillion spending cuts estimated to see federal debt rise from 117% of GDP to 124% by 2034: that’s a slower pace of increase than of late even if it means fiscal deficits average 6.8%. Notably, this includes an increased Pentagon budget rather than the significant cuts floated recently alongside a Trump proposal the US, Russia, and China all slash their defence spending in half.