White House officials pushed back Sunday against concerns that economic growth may be faltering, saying they saw little risk of recession despite a volatile week on global bond markets, and insisting their trade dispute with China is doing no damage to the United States
“There is no recession in sight,” White House economic adviser Larry Kudlow said Sunday on TV. ”Consumers are working. Their wages are rising. They are spending and they are saving…I think we are in pretty good shape.”
For moment last week bond investors also demanded a higher interest rate on 2-yr T’s than for the 10-yr benchmark, occasionally construed as a sign of lost faith in near-term economic growth.
Trade adviser Peter Navarro Sunday dismissed last week’s warning signs, saying “good” economic dynamics were encouraging investors to move money to the United States.
“We have the strongest economy in the world and money is coming here for our stock market. It’s also coming here to chase yield in our bond markets,” Mr. Navarro said on TV.
The tariffs on Chinese goods, he said, “are not hurting anybody here.”
The US economy does continue to grow and add jobs each month. Retail sales in July jumped a stronger-than-expected 0.7%, the government reported last week, that number shows that the main prop of the US economy is intact.
But manufacturing growth has slowed and lagging business investment is dragging. Globally, flagging global trade appears to have pushed the German economy toward recession, and dampened growth in China.
Which is just the effect President Trump wants, as he prepares to hammer the EU next.
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