US Presidential Election Series: Trump lays out his fiscal plan

Republican Presidential Nominee Donald Trump just laid out his fiscal plans to stimulate and revive the economy; one that would create jobs for all Americans. If Mr. Trump can follow through his plans it could turn out to be a good plan for the financial markets too.

Speaking to the Economic Club in New York, Mr. Trump said that his plan would include a 15 percent federal tax rate from current 35 percent. He added that there would also be a cut in the income tax rate from current 39.6 percent to 33 percent. Well, if followed through it would be fantastic news for the market, especially the S&P 500 index. Mr. Trump said, “If we lower our taxes, remove destructive regulations … unleash the vast treasure of American energy, and negotiate trade deals that put America first, then there is no limit to the number of jobs we can create.” According to his campaign’s calculation, his fiscal plan would lead to a more than 2 percent growth; more towards 3.5 percent and would create 25 million new jobs.

While some economists pose doubts on the ability of Mr. Trump to execute his plan since it would threaten to increase the deficit’ majority of them agree that Trump’s policies are in right direction. To revive growth tax rate must be lowered and the government need to reduce regulatory burden.

While launching his ambitious plan, Mr. Trump maintained his attacks on Fed for low interest rates. He has suggested that the Fed has created a false economy with low interest rates.