A rich guy I know really, really dislikes Donald Trump. A member of the 1 percent, Jack (not his real name) thinks the president has sullied the country's reputation and put democracy in danger. But I had to ask him this: "Aren't you at least happy with the stock market?" He's done quite well on that score, as have many investors.
"Yes," he said, "happy in the short term, but as a long-term investor, neither happy nor optimistic."
Formerly employed in finance, Jack sees a return to the "snake oil policies" that led to the 2008 economic meltdown. The renewed passion for deregulating Wall Street, he believes, will feed "the take-the-money-and-run attitude symptomatic of Trump's history and the swamp he has brought with him."
Jack regards the president's talk about opening the money spigots to grow the economy as baloney. "Fact is, regulations notwithstanding, financial institutions are flush with money to invest and loan out," he said.
Though Jack might personally benefit from some of the proposed tax cuts, he sees them vastly worsening budget deficits. Rising deficits would lead to higher interest rates, costing growth.
Other Wall Street sophisticates are not terribly impressed with Trump's economic policies. Trade wars, for one, would deal a blow to the economy, bringing stock prices down with them.
Trump's threats against the North American Free Trade Agreement are especially concerning. If NAFTA were ditched, "we'd surely see a stock market correction," economist Allen Sinai told The Wall Street Journal.
It's nice to watch the Dow Jones industrial average hitting record highs, but in this environment, a 1-point gain can produce a new high. In football terms, "it's the market equivalent of 3 yards and a cloud of dust," Scott Clemons, chief investment strategist for Brown Brothers Harriman, told Barron's. "It's just one slow grind upward."
Still, the Dow has posted more than 50 highs this year. There haven't been that many since 1995 — when Bill Clinton was president. That year, the Dow broke its record 70 times.
Speaking of stock market highs under Democrats, there were 61 in Barack Obama's last three years in office. The early years, we recall, were spent climbing up from the flattened market he inherited from his deregulation-happy predecessor.
Kevin Hassett, co-author of a legendarily ridiculous guide for investors, "Dow 36,000: The New Strategy for Profiting From the Coming Rise in the Stock Market," is now Trump's top economist. Published in 1999, "Dow 36,000" predicted that in three to five years, the Dow average, then trading at around 11,000, would triple to 36,000.
If you wait too long, the book warned, "the benefits of Dow 36,000 will pass you by." Five years later, the Dow finished 2004 at 10,783.
When Trump named Hassett to lead his Council of Economic Advisers in April, economists quipped that it was so close to April Fools' Day it might have been a joke.
Some less encouraging high numbers: Budget deficits are the highest they've been in four years. U.S. household debt — driven by home mortgages, auto loans and credit card balances — recently broke a record.
Showman Trump portrays every bit of positive economic news as evidence of his superhero powers, but inconvenient facts remain. One is that stock markets in other countries have also been hitting highs. The other is that the U.S. economy since he became president has not been all that hot.
Goldman Sachs just sent a note to clients predicting 3.9 percent annual growth in the global economy through 2020. It expects U.S. growth, on the other hand, to slow to just 1.5 percent. Trump set 3 percent as his standard for success.
Ah, so much winning.