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Fourth Quarter 2017 U.S. Economic Growth Remains Strong, But Will Likely Be Less Than Q3 2017. The Year 2017 Is Likely To Be About 2.6%.

ArmchairPolitiicianEconomy, December 3, 2017, by Brad Peery,

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*Third quarter 2017 economic growth has been revised upward from 3.0% to 3.3%, and the nine-month 2017 GDP growth rate has been revised upward to 2.5%. The fourth quarter is expected to come in slightly under 3.0%, leaving the year 2017 at about a 2.6% increase.

The stock market continues to be strong, fueling consumer spending and corporate capital expenditures. Consumer spending grew 0.3% in October, 2017, down from a very strong 0.9% increase in September. Consumer confidence is also very strong, having risen to a 17-year high. Home sales have also been very strong. The national savings rate was 3.2% in October, just slightly above the 3.0% savings rate in September. This was the lowest level of savings since November, 2007, which was at about the beginning of the last recession. The unemployment rate continued to decline, reaching a 4.1% level in October, 2017.

ArmchairPolitician.US Opinion
Both the House and the Senate have passed Tax reduction bills, which will need to be reconciled, and then reconciled, probably by very thin margins. President Trump hopes to sign the tax bill by Christmas. Assuming that the tax reductions for corporations will decline to about 20%, there will be a provision that will be attractive for corporations to repatriate foreign earnings, and that personal income taxes will decline for most of the middle class, the U.S. economy should have growth of at least 3.0% to 3.5% in 2018.

The low savings rate could benefit from the tax reductions. Also, the stock market is likely to remain strong unless there is an unforeseen event, such as a war with North Korea, or Chinese or European crises. We expect consumer confidence and corporate capital expenditures to remain strong.
* Economy, Markets Rev Up, Wall Street Journal, by Josh Mitchell and Nick Timiraos, November 30, 2017

See:
ArmchairPolitiicianEconomy, November 1, 2017, by Brad Peery, ArmchairPolitician.US@gmail.com, www.ArmchairPolitician.US
U.S. Economic Growth Hits 3% In The September Quarter. The Year Is Expected To Be 2.4%.

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