For the first time in decades, United States economic predictions are being based more on the political climate than the state of specific industries. Donald Trump’s victory in the 2016 presidential election is a sure signal about the unpredicted focus of the American people and their vested business interests. 2017 is already gearing-up to be a raucous year for the economy. The following are bold predictions about the economy based on current events, which are sure to make many forecasters think twice about their notions regarding money and investments.
Precious Metals Will Make A Comeback
Since the Bush Sr. administration there has been a concerted effort on the part of central banks to make paper currencies the primary focus of all international trade and commerce. The veil of unbacked currency is wearing thin in developed and developing nations that are dealing with social and political issues. 2017 will be the year where the majority of large trade nations take a second look at the status of their currencies on the world stage. With these uncertain machinations, smart investors including large banks, will continue buying metals like gold and silver in record amounts. Though governments will not recognize it, scarcity will naturally propel the price of these metals to record levels. Private metal owners will thus experience increased buying power and security.
The DOW Will Correct Itself
A new conservative core government in the United States is certain to take steps to minimizing the influence of the Federal Reserve Bank on the stock market. Each month, the FED buys immense amounts of stock in order to create a market outlook that is positive, but does not accurately reflect the real American economic environment. As a reconfiguration of investment laws gradually forms, a major correction in the stock market is certain. Most investors recognize that the markets are extremely over-valued and a correction is due. This correction could be as much as 30 percent, which would plummet the DOW to 2010 levels.
Gas Prices Will Fall
It’s a fact that there is a huge glut of oil and fuel supply sitting idle in the world. Fuel-producing nations like Russia, the United States, Saudi Arabia, and Venezuela are sitting on supplies that are sufficient for decades of present level use. The Trump administration has indicated that future actions regarding fuels will be focused on the deregulation of supply and refining industries. This is evident in the present battle over constructing new trans-North American delivery pipelines. This is sure to create a trickle-down effect throughout the world resulting in lower fuel prices.
Deflation Will Emerge
Actions like the rescinding of the Pacific Trade Agreement will put new constraints on food production industries in 2017. While some food commodity prices lower, the overall supply of foodstuffs throughout the world will also decrease. Major shortages in common grocery items could happen, which would create tension in distribution investment.
Housing Trends Will Favor Development
The Trump administration has made it clear that deregulation is a focus. Many housing market statistics indicate that this trend could only make a post-recession building environment more attractive to developers. This attraction to boost volume is especially powerful in multifamily and urban expansion housing developments. Evidence for this economic phenomenon is evident from endless financial analysis resources including Rusty Tweed Economics.