CNBC – February 19, 2018: The highlights of the article asserts that the U.S. economy won’t be able to count on the pump-priming from tax cuts for very long. And with Federal spending, rising yields and the surging debt needs are a growing worry and the deficit spending is approaching ‘uncharted territory’, says Goldman Sachs analysts.
President Trump ambitious infrastructure plan is seen as unrealistic and with the budget, drew fire from virtually all sides at the discussion table. The Republicans are counting heavily on the fiscal stimulus provided by tax reform. But Goldman Sachs warned that the economic momentum from tax reform could have diminishing returns after this year.
While the tax cuts are seen as partly responsible, Goldman also stated that the “projected increases in mandatory spending — this includes Social Security, Medicare, Medicaid, and income support programs — are primarily responsible” for the surge in spending and is unsustainable.