It’s been a very long time since I’ve been so optimistic about what is happening in the economy. The latest optimism index dispels all notions of a looming recession. We are living in an economy with business owners feeling very grateful for significant tax relief, so confident that they are set to move forward with business growth plans, all while creating even more plans to raise compensation.
This sentiment abounds and gets even better when we consider the most recent jobs report, fueling only more excitement into this already strong economy. We witnessed not just great but astonishing numbers, and we can give credit to this pro-business administration. An amazing 266,000 jobs added and the unemployment rate down to a 50-year low are major wins for America and American workers.
The latest optimism index also posted the highest month-over-month gains since May 2018, rising 2.3 points to 104.7 for the month of November. This is exceptional optimism. The reading was bolstered by 7 of the 10 components improving. Owners reported it is a good time to expand, increasing by 6%, and those expecting better business conditions increased 3 points. The NFIB uncertainty index fell 6 points. That may be one of the most important aspects, adding a four-point drop in a revised October number. It’s the lowest since May 2018, and this historical run defies expectations of many, but it is amazing as we continue to see small businesses thrive.
NFIB chief economist William Dunkelberg says this about the optimism: “Owners are aggressively moving forward with their business plans, proving that when they’re given relief from the government, they put their money where their mouth is, and they invest, hire and increase wages.” Owners are most closely focused on issues that directly impact their business, including the real significant tax relief they were given two years ago, and they’re anxious to see this relief made permanent. By the way, 30% of small business owners reported raising compensation, and 26% planned to do so in the upcoming months. This is the highest level since December 1989, and we owe it all to the Trump administration.
Thanks to this administration, we can proceed with a great deal of certainty that President Trump will remain strong in his pursuit of ‘America-first’ policies. As evidence, Fox Business recently boasted this exciting headline: “Dow gains 10,000th point since Trump’s election.” In fact, Fox went on: “The stock market has been unstoppable under the influence of President Trump.”
Maybe this isn’t a question anyone is asking, but I’ll ask it: Are Americans worried about impeachment? The most recent consumer confidence reading could actually lead Americans to spend more money—not less. Frankly, I don’t think most Americans have been spending any time worrying about impeachment—they’ve seen it for what it is.
The American consumer, better than anyone else, has the ability to hang in and be strong and tough during long economic expansion. After the dip of recent months—it didn’t matter; even the dips over the past two years—it didn’t matter.
Many experts were concerned that the U.S. trade war would cause concerns with consumer confidence. But here’s the deal—nobody has their ear to the street better than consumers. These are the people who are actually working for a living every day. They see their wages go up. They have seen opportunities for jobs they haven’t seen in 15 years. They understand what this administration has done.
The University of Michigan consumer sentiment surveys have gotten better and better. As a matter of fact, since 2017, in 30 of the past 35 months, the sentiment number was 95 or higher. We haven’t seen that kind of optimism since the ’90s and President Clinton.
I’ve been saying for a long time that consumer confidence and consumer sentiment are absolutely amazing, and it is exactly what will continue to drive this economy for the rest of this year. And it will take a fairly dramatic change in some of the economic numbers for that to start to turn negative.