Before the inauguration, Americans were promised health care reform, tax reform, major infrastructure projects, and a wall along the Mexican border, all by the end of the year. Looking at things eight months later, it would appear that we may not get any of those things this year.
Bringing Back Past Industries
While the inability to pass major legislation thus far has been apparent, the White House has been quite effective at cutting regulations, streamlining processes and breaking up bureaucracies that have been in place for decades at a higher success rate. What this means for many companies is more profits. In some cases, such as coal mining, it means bringing back entire industries that had previously been almost shut down. For other businesses, such as companies involved in infrastructure projects, it means getting projects approved faster and with less paperwork.
How Does This Affect the Finance Industry?
In the financial services industry, it means spending less on compliance and more on customer service. In the drug sector, it means faster approvals or rejections of new drug applications. The good news is that almost all of these changes are meant to get the U.S. economy moving faster and involving more people.
Is the Stock Market Effected?
It appears to be working. Here in Michigan, the unemployment rate dropped to 3.8% in July according to The Detroit News – the lowest rate in 17 years. While the national unemployment rate has dropped to 4.4%. What this means for the stock market is better profitability and higher stock prices. This is what has driven the stock market increase thus far and it’s showing up in earnings reports in many industries. The big question is, however, how much longer can we keep speeding the economy up without Congress’ help? The answer is that nobody really knows, but at some point, in the not too distant future, the economic growth rate will start to slow if some major legislation doesn’t start to get passed.
Let Us Help Make Your Next Move
There is one certainty in life: the economy is always changing. Reaching your financial goals can be intimidating, but we’re on your team with more than thirty years of experience. If you are unsure about your financial obligations or goals, schedule a consultation today with Daniel Investments and feel more comfortable about your finances.