IN­FLA­TION

Alberta Venture - - The Money Book -

Shortly after Trump’s pres­i­den­tial vic­tory, mar­kets fore­shad­owed ris­ing in­fla­tion based on his cam­paign prom­ises. The pres­i­dent says he will ramp up gov­ern­ment spend­ing and boost GDP a whop­ping four to five per cent, caus­ing mar­kets to coin the “Trumpfla­tion” moniker. His poli­cies, like spend­ing $1 tril­lion on in­fra­struc­ture and low­er­ing per­sonal and cor­po­rate taxes, all lead to eco­nomic growth, which causes in­fla­tion to creep up. Pel­letier says these mar­ket in­di­ca­tors are no longer spec­u­la­tive. “The mar­ket’s re­ac­tion since the Trump elec­tion is say­ing, ‘Yes, ab­so­lutely it’s com­ing,’ ” he says. “Mar­kets have a strong con­vic­tion that Trump will im­pact in­fla­tion.”

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