Let's Embrace Our Future With Hope, and Without Fear

During most of my career as a financial market economist, I made it a holiday tradition to write a "review and outlook" for the economy in the style of Clement Moore's classic, "A Visit from St. Nicholas." I have continued this tradition since my retirement in 2012. In this year's rendition - the 33rd - I ponder what Donald Trump's historic election might mean for the economy.

'Twas the night before Christmas, the stars shining bright
Would light Santa's way through the dark wintry night.
And I, with my shopping all done, sat down at last
To ponder some strange things from the most recent past.

For when I look back on the year twenty sixteen
I wonder in awe at things never before seen.
Mother Nature, for one, caught my full attention
With damage from Matthew too awesome to mention.

But mostly my thoughts on this brisk holiday eve
Turned to matters I still find so hard to believe.
And that was the rise of a political novice
Who will soon hold the world's most powerful office.

When Donald Trump first did his intentions declare
Some saw just a TV star with wild golden hair.
The experts and pundits were vocal and quite sure
That this gadfly's campaign could never endure.

His ideas, they said, were just bluster and bluff
But to his supporters Trump seem'd solid and tough.
He's "No Mister Nice Guy" and they wanted a change
From the "too PC" world that's so foreign and strange.

One by one, Trump mocked his foes as bad, worse, and worst
Vowing he alone would "put America first."
It matter'd not if sometimes he'd get his facts wrong.
Trump voters cared only that his message was strong.

And after defeating the large G-O-P field
Trump, on election night, forced Hillary to yield.
Now the election's over but what lies ahead?
The markets see hope but the Trump-haters see dread.

In the days since this year's big election surprise
Stock prices keep on climbing to new record highs.
Such hope seems based on a judgement that's sound
That a pro-growth policy mix soon will be found.

Less intrusion from government lies at the core,
With tax cuts and health care reforms also in store.
Pooling public and private funds we will invest
To make our roads, airports and bridges the world's best.

The Trump team pledges too it will regulate less
And peel back the red-tape that's an anti-growth stress.
The markets too it seems have reached the conclusion
That Trump will end lobby and crony collusion.

But not all of Trump's plans deserve full-throated praise,
'Cause growth will be slower if new tariffs we raise.
And Trump must speak from his "bully-pulpit" with care
Trusting markets to sort out what's right and what's fair.

With stock market prices reaching ever new highs
The dollar's FX value continues to rise.
So tricky policy choices soon must be made
If Mister Trump still wants better balance in trade.
.
The new President too must learn to live with a Fed
That steers its own course and will not be led.
And precisely because the outlook's now brighter
The Fed's once again setting credit terms tighter.

This strange unknown future has my head all a-spin
But I'm certain some big changes soon will begin.
But whatever's on tap in the coming new year
Let's embrace our future with hope and not fear.