Hope And Change:You'd never guess this from the end-of-the-world treatment President Trump gets in the mainstream press, but his election has unleashed a wave of optimism about the economy we haven't seen in more than a decade. This is huge news that has big implications about economic growth.
The latest business leaders' survey from JPMorgan Chase finds a dramatic increase in optimism among the 1,400 middle-market executives polled. It found that 80% of these executives are optimistic about the economy, which is nearly double the share expressing optimism just one year ago. And it's the highest level since this survey began seven years ago.
These executives, the survey found, "expect improved performance in the global, national and local economies, as well as their own businesses."
The survey also found that more than three quarters of these midsize business owners say that Trump's election will have a positive impact on their companies because of his promise of pro-business policies, tax reform and cutbacks in federal regulations.
A National Federation of Independent Business survey found the same surge in optimism among small businesses since Trump won the election in November. At 105.9, this index is the highest it's been in more than 12 years.
"Small-business owners like what they see so far from Washington," said NFIB head Juanita Duggan.
Investors like what they're seeing, too. In fact, since Trump's inauguration in January, the Dow Jones industrial average has climbed more than 4%, the biggest post-inaugural jump in that index since FDR.
And that only counts the past month. The Dow immediately spiked after the November election and has climbed more than 13% since.
There's no other way to read this than as a thumbs up from investors to Trump's economic agenda, since the only thing that's changed is expectations about the direction of economic policy — away from President Obama's growth-choking tax-and-spend liberalism.
Individuals are more optimistic than they've been in more than a decade, as well. The IBD/TIPP Economic Optimism Index is now 56.4, which is 10% higher than it was the month before the election, and the highest it's been since October 2004. (This index averaged just 46.6 during Obama's entire eight years in office — anything below 50 signals pessimism.)
Other confidence measures show the same results. The Conference Board's Confidence Index hit a 15-year high in December and is currently up 9.8% from last October. The University of Michigan's Consumer Sentiment index is up 9.7% over these same months.
The wide reach of this sharp boost in confidence could provide an immediate jolt to the economy, one it's been waiting for since the Great Recession. Business owners who are confident about the future are more likely to invest and create jobs, and people who are more confident are more likely to spend.
These results also highlight the glaring disconnect between elite opinion and the views of Main Street. While media pundits, fat-cat corporate CEOs and urban liberals are wailing and gnashing their teeth over Trump's election, the general public understands that his victory provides genuine hope that the economic malaise Obama inflicted on the country will soon be over.
The Never-Trumpers can't bring themselves to admit any of this, for obvious reasons. But if there's bigger news since Trump's surprise November victory than the dramatic increase in hope across the land, we'd like to see it.