Navarro Sees Dow at 30,000 If Two of Trump’s Wishes Come True

In this article

The Dow Jones Industrial Average will reach a record-high if the Federal Reserve lowers interest rates and Congress approves President Donald Trump’s new U.S.-Mexico-Canada trade pact, according to White House trade adviser Peter Navarro.

“We’ll get to 30,000 on the Dow if we pass USMCA, we cut interest rates and we move forward with the Trump-growth agenda,” Navarro said in an interview with Bloomberg Television Wednesday.

If either one of these scenarios materialize in the next few months, investors can expect stocks to rally — even while the U.S. continues to negotiate with China. The nation is in a legitimate “trade dispute” with China, not a trade war, and those negotiations are “back on track,” Navarro said.

“We’re going to the negotiating table, and from an investor’s point of view, I think this is very bullish,” he said.

Navarro also said that the resumed China talks could take awhile. “We like to move on what we call Trump time,” he said. “We don’t waste time. On the other hand, the president is right in saying we want to get this right.”

U.S. Trade Representative Robert Lighthizer will have face-to-face talks with China Vice Premier Liu He soon, Navarro said on a subsequent interview with Bloomberg Radio. He said the plans are in process for talks with Liu, who he called “the reformer on the Chinese side.”

Navarro said the U.S. also has “legitimate trade disputes” with Europe, not just China. Earlier this week, the U.S. added an additional $4 billion worth of European Union products to a list of goods that it could hit with retaliatory tariffs as part of an ongoing dispute between Boeing Co. and Airbus SE.

Navarro previously told CNBC Tuesday that signs of the economy slowing in the U.S. is a residual effect of the Fed raising interest rates too quickly while also engaging in quantitative tightening, not a byproduct of tariffs. He said the economy can get the “half-to-one full point of growth” lost from the hawkish policies if the Fed cuts rates and “does the right thing.”

Source: Read Full Article