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Linked articles in bold purple
◆ Very good economic news, twice over
- Highest readings on “consumer sentiment” in 13 years (Bloomberg)
- Retail sales are surging (USA Today)
- Leapt 1.6% last month, most in 2.5 years
Overall, a very strong report across multiple economic sectors, despite the hurricanes.
The retail sales report is closely watched because it provides an early read on consumer activity each month. Consumer spending accounts for about 70% of the economy.
U.S. economic growth likely slowed in the July-September quarter as the hurricanes shut down thousands of businesses, people were forced to miss work, and power was cut to millions of homes. Analysts forecast that the economy expanded at a 2% annual pace in the third quarter, down from a 3% gain in the April-June quarter.
Yet the economy is expected to rebound in the final three months of the year as rebuilding and repair work accelerates. –USA Today
Comment: Very good news, indeed. To keep it going, especially as interest rates rise and the job market gets tighter, the administration needs to keep reducing regulations and get a tax cut through Congress.
◆ Trump refuses to certify the Iran Nuclear Deal, saying it is not in America’s best interests
He made a strong speech, which included an itemized list of Iran’s lethal attacks on Americans and its sponsorship of terror throughout the Middle East.
The hardest immediate blow to Iran was Trump’s decision to label Iran’s Revolutionary Guard as a terrorist entity. That’s important because the Revolutionary Guard is the regime’s enforcer and controls a huge chuck of the country’s economy.
Next up: Congress has to determine whether to impose sanctions on Iran.
If it does, then the US effectively withdraws from the multilateral “Joint Agreement.” But who knows what Congress will do, especially with Trump’s latest personal foe, Bob Corker, as head of the Senate Foreign Relations Committee?
As expected, the other signatories to the agreement didn’t like Trump’s decision.
15 fires have burned over 200k acres so far.
◆ Trump hits Obamacare with a double whammy, ending subsidies to private insurers and urging competition across state lines
Without subsidies, the insurers will likely stop providing policies to lower-middle-class consumers. The poorest are not affected because they are on Medicaid. The better off are not affected if they have employer healthcare plans.
Whether insurers can operate across state lines will depend on whether state regulators allow it. Right now, they don’t.
Comment: The pace is extremely slow. Trump has been slow to put forward nominees in some areas. The Democrats have opposed everything, tooth and nail. And the Republicans have refused to change any rules to speed things along, giving free rein to the Democrats’ delaying tactics. Since many establishment Republicans oppose Trump, the delays may be just fine with them.
But rank-and-file Republicans and many donors are not happy. They especially want to see judicial nominees moved along expeditiously.