By listening to President-elect Trump we can anticipate the effect his administration will have on the US economy.
Here is what we know: Mr. Trump plans to beef up the military, and improve US infrastructure, including a wall at the southern border.
While there are other priorities, such as improving on healthcare, just his two main goals will require many billions of dollars.
Being a successful businessman is his asset, and no doubt the new president will surprise us with funding that will be new and novel, such as enticing US companies with overseas assets to repatriate those funds and put them to work in the USA.
Nevertheless, we can be assured that whatever new sources of revenue the new administration comes up with, government spending will increase and so will the Federal Deficit.
The total US Federal Deficit will top 20 trillion before long. This will be accomodated with more printing press money. Congress and the Senate are likely to go along with spending plans. Already the ongoing monetary inflation is causing price inflation, and the expectation is that this price inflation will accelerate.
Our ‘investing for maximum profits’ therefore must include stocks and commodities that will grow during a period of price inflation.
This post was published at GoldSeek on 28 December 2016.