Painting a rosy picture for 2020, White House economist Peter Navarro predicts close to 3% GDP growth, Dow 32,000, and historic job and wage growth in one of the "greatest years in U.S. history economically."
"This economy under President Donald J. Trump is setting up beautifully for a economic boom and a bull market," Navarro, the White House trade and manufacturing policy director, told "The Cats Roundtable" on 970 AM-N.Y.
The Trump administration had four pillars of the compass to spur economic growth, Navarro said:
- Tax cuts.
- Deregulation.
- Cheap energy.
- Fair trade.
Navarro then pointed to the following factors in driving the economy under the Trump administration through 2020:
- 5 trade deals enacted in 2020 (Japan, South Korea, U.S. Mexico-Canada Agreement (USMCA), and Phase I with China).
- Low interest rates.
- Low unemployment at 3.5%.
- Strong government spending, especially defense.
- Rising wages.
- Consumer confidence, leading to spending.
- Business investment, especially from outside of the U.S.
"My forecast, basically, is much closer to 3% real GDP growth than 2% for the year, and I predicted some months ago that we'll hit 30,000 on the Dow if we were able to pass the US-Mexico-Canada agreement and get lower interest rates from the Fed," Navarro told host John Catsimidis, saying by the end of the year the Dow will hit even 32,000. "Both of those things have been put into place.
"We're waiting for the Senate to seal the deal on the USMCA. The stock market has been moving beautifully upward, and I anticipate it will continue."
Navarro credits real optimism from consumers and workers, saying "consumers are the anchor for the boom that's going to occur in 2020."
"Everybody who wants a job can get a job in the Trump economy," Navarro said. Everybody who wants to look for a better job has more opportunity to do so. And that gives families sitting around the kitchen table a lot of comfort."
Navarro has predicted a sixth trade deal coming after the United Kingdom breaks from the European Union.
"We've been talking to the Brits for over two years," Navarro said. "We are chomping at the bit. They are chomping at the bit. The problem is we cannot enter into an agreement as long as they are still technically part of the European Union. Once we get that hard Brexit, we will move forward with the negotiations."