Business magnate Donald Trump recently shared his outlook on the US economy and according to him, it isn’t pretty. Presidential race front runner and Republican Trump never fails to make waves, and his latest declaration comes on the back of some murmurs in the market, creating a perfect platform for his views.
Hoping for the economy to explode now
Speaking at a rally in Iowa, Trump said that he would be the first to tell it like it is and that it looked like dark days ahead for the US economy. Trump told his audience of over a thousand that he saw a rocky road ahead and given the outlook, he would rather have any downsides to showing themselves while the current administration was in office.
It is clear that he feels that any instability is something those currently in office have been responsible for. So he does not want the new administration to be called out for something that happens a few months into their taking charge. In his words, he expressed his wish that harsh though it sounded, was a hope that ‘if it explodes, it's going to be now’ as opposed to when the government sees a new team at the helm.
A bubble that’s going to burst
Trump went so far as to use the word bubble in his address to the people of Cedar Rapids, saying that the United States economy was in a bubble - one that could burst any minute. While Trump claims that he was going to be the first to bring up the bubble, this is something industry analysts and the media counter, saying it isn’t something new and others have hinted at this bubble in the past.
Trump’s track record on similar calls
Some veterans of the industry believe that calling this a bubble would be a call that’s not only inaccurate but wrongly timed as well. According to Donald Trump, the market had taken a beating in recent weeks and a bubble burst followed by a colossal crash could be crippling.
Some equity analysts and commentators went so far as to question his accuracy and his track record in predicting the way the economy would move. According to Barry L Ritholtz on Bloomberg View, in 2013, the year Trump said that America should steel itself for financial ruin and that recession would be a nice word, the S&P 500 actually gained. His outlook on unemployment post the implementation of ObamaCare was that it would go up from its 9 percent levels in 2011. Today, the unemployment levels are down by 5 percent.
Whether or not his current predictions do play out, what is clear is we will be hearing more from this candidate before the campaign season ends.