Weekly Economic Report
Global politics took another turn to the right over the last two weeks, increasing the role of nationalism. This is good news for domestic businesses, particularly on tax rates and regulatory oversight – but far less so for multinational companies and China, which will face rising barriers to trade. Consistent with the gloomier outlook for international transactions and potentially growth, new orders for capital goods produced in the US continued to slow. As we have pointed out many times before, US capital goods production is largely for export – particularly by US multinationals that are setting up operations in foreign countries. Between growing nationalism and the Chinese trade war, the outlook for these firms has dimmed significantly since Trump’s tariff announcement in September. This occurs even as even as the US tax cuts continue to boost demand for imported capital goods, largely electronics that are needed as employment in the service sector continues to soar.