America’s New Emphasis on Fiscal Policy

For the third time in two years, the Federal Reserve lifted interest rates 0.25 percent last week following the previous week’s phenomenal jobs report. The move was seen as more dovish than many market analysts had anticipated. BCA Research went so far as to call it an “unhike,” citing a number of factors, including forecasts of only three rate hikes in 2017 instead of four. Immediately following the announcement, the dollar lost ground, clearing the way for gold to climb more than $20 an ounce. During her press coverage, Fed Chair Janet Yellen expressed doubt that the U.S. economy can grow much faster than 2 percent annually over the next couple of years, placing her squarely at odds with President Donald Trump, who campaigned on a pledge to boost GDP growth as much as 4 percent. click to enlarge Since Trump’s inauguration more than 55 days ago, we’ve seen a steady power shift from the monetary side to the fiscal side. I believe this will only continue to...

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