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Speaker 1: Economists are warning that we may have to downgrade our

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Speaker 1: economic outlook as a result of Donald Trump's election because

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Speaker 1: analysts from BMI, which is part of Pitch Reckon, we're

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Speaker 1: going to lose ten percent of growth two percent growth

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Speaker 1: down to one point eight percent next year. Brad Olson

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Speaker 1: is in for Metrics Principal economis and with US Now.

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Speaker 1: Hello Brad, Hello, nice to have you in the studio.

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Speaker 1: Thank you for coming in. Brad. Is this based entirely

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Speaker 1: on the prospect of him doing the tariffs.

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Speaker 2: I don't think it's just the tariffs. The tariffs do

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Speaker 2: make a bigger part, and certainly longer term. I think

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Speaker 2: we're almost more worrying because if the US puts on

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Speaker 2: the tariffs, doesn't buy as much mo overseas, there's not

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Speaker 2: as much need for overseas to produce stuff. Therefore there's

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Speaker 2: not as many manufacturing jobs overseas and they don't have

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Speaker 2: money that they then spend on our stuff. But I

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Speaker 2: think also importantly, if Trump then comes through with some

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Speaker 2: of the tax cuts in that that he wants to

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Speaker 2: bring through, most expectations from US economists is that that

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Speaker 2: would be inflationary. Therefore next year there's not as much

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Speaker 2: need for the Federal Reserve to cut interest rates back,

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Speaker 2: so there's not as much economic growth coming forward if

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Speaker 2: that's the case, if interest rates have to stay higher.

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Speaker 2: So I think it's a combination of the tariffs but

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Speaker 2: also of his other economic policies that would almost drive

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Speaker 2: too much short term economic growth in the US, which

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Speaker 2: would cause an inflation to be higher, and then interest rates.

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Speaker 1: And then how much of it also, I mean, because

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Speaker 1: he's really he I mean, he is intending to make

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Speaker 1: life very difficult for China. Right, how much of this

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Speaker 1: is squeezing China's economy, which we're reliant on.

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Speaker 2: Yeah, I mean that's a big enough part of it,

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Speaker 2: particularly when the Chinese economy is not doing great to

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Speaker 2: start with, right. But I think also interesting, I mean,

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Speaker 2: the question for me is how quickly does this come through?

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Speaker 2: And it's been fascinating the last day or so looking

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Speaker 2: at some of Trump's cabinet picks. He's picked, you know,

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Speaker 2: the head of the EPA, He's picked someone to run

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Speaker 2: the border. He's picked by the likely bud sounds of

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Speaker 2: secretary of State, no Treasury secretary yet or anything like that.

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Speaker 2: So I do sort of wonder if he's made it

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Speaker 2: a bit clearer. He wants to do stuff around environmental regulation,

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Speaker 2: he wants to change border settings and what have you.

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Speaker 2: He doesn't seem like he wants to go gung ho.

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Speaker 2: You know, first minute of his presidency will be tariff.

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Speaker 2: This might be a slightly more delayed impact coming through

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Speaker 2: on the economy. It might not hit day one.

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Speaker 1: I do not believe he's going to do the tariffs.

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Speaker 1: I just I think the reason being that I think

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Speaker 1: he says a lot of stuff that is designed. Like

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Speaker 1: any deal maker, right, you say a lot of stuff

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Speaker 1: up front, you freak people out, and then you soften

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Speaker 1: your position, and then you strike the deal. And I

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Speaker 1: just wonder if the tariffs are that. And I think

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Speaker 1: because I think that when he thinks it through and realizes,

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Speaker 1: as has been pointed out to me, how much of

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Speaker 1: our stuff go as componentry goes into other things, and

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Speaker 1: what the impact that that's going to have, I don't

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Speaker 1: think it's going to be a good idea for him.

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Speaker 2: Well, but this is the challenge, right, does he believe

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Speaker 2: that he's going to do it? No one's got that

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Speaker 2: certainty either way, because I guess the other risk is

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Speaker 2: that he sort of doesn't do it immediately, everyone drops

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Speaker 2: their guard and then all of a sudden, bang, he

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Speaker 2: puts twenty percent tariffs on and so that unexpectedness I

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Speaker 2: think is causing a little bit, maybe not volatility, just

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Speaker 2: everyone's questioning at all. And I think also he's been

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Speaker 2: pretty clear as an incoming president he wants more manufacturing

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Speaker 2: in the US, and tariff's would do that to a degree.

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Speaker 2: It would still cost the economy overall, but if he

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Speaker 2: does want to get some of those blue collar, you know,

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Speaker 2: manufacturing jobs back, and that could be a way to

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Speaker 2: do it.

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Speaker 1: Bred We're going to talk to retail New Zealand in

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Speaker 1: about well maybe like fifteen minutes or thereabout. It's about

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Speaker 1: what they're expecting for the upcoming Christmas season because the

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Speaker 1: credit can't spending was pretty flat last month. What do

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Speaker 1: you reckon?

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Speaker 2: Well, we got a new card spending today which actually

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Speaker 2: so sort of a continued flattening off. Maybe a little

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Speaker 2: bit of a boost coming through in the seasonally adjusted numbers.

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Speaker 2: It's not enough to sort of call this a Christmas

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Speaker 2: bonanza yet, but maybe some slightly better news. Those interest

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Speaker 2: rates staying to have an impact. I think the thing

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Speaker 2: we'll all be waiting for is those Black Friday sales

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Speaker 2: that come through some of the cyber Monday stuff like

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Speaker 2: are people spending or not? Because I keep hearing people

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Speaker 2: that sort of say, if the special wasn't good enough,

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Speaker 2: if there's not enough deals going around, I'm still not buying.

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Speaker 2: So maybe some early signs, but I don't think it's

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Speaker 2: enough to make for a great Christmas.

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Speaker 1: Yeah it doesn't look like it. So have you done

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Speaker 1: that thing that everybody does where you canbine work with

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Speaker 1: a Coldplay concert?

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Speaker 2: I very much have. I am happy. I've got some

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Speaker 2: work meetings in the next couple of days, but I've

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Speaker 2: also got an appointment with coldplatemorrow night with you and

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Speaker 2: a few other people. By the sound.

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Speaker 1: Yeah, I'm going to be there. We're going to be

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Speaker 1: raging out together, aren't we.

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Speaker 2: It's going to be great. You'll be Coldplay fan or

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Speaker 2: what I am? I mean fix you as my go

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Speaker 2: to I'm not the most upbeat song in my life,

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Speaker 2: but maybe that fits with the dismal science of economics

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Speaker 2: that you know a little bit downbeat every now and then.

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Speaker 2: But I will try and fix you with the economics overall.

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Speaker 1: I'll tell you what, why don't we get Adrian to

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Speaker 1: listen to fix you instead of what he's trying to

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Speaker 1: do to the economy.

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Speaker 2: I think that a sky full of stars might be

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Speaker 2: more apped at points.

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Speaker 1: Oh jeez, is there a song about trees? Because I

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Speaker 1: don't believe does identify as one of them.

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Speaker 2: The scientist's clocks and otherwise, but yeah, I'm not sure

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Speaker 2: about trees. Jeez.

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Speaker 1: Hey, enjoy the concert and thanks for coming and really

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Speaker 1: appreciate it. That is Brad Olsen, Infametric's principal economists. For

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Speaker 1: more from Heather Duplessy Allen Drive, listen live to news talks.

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Speaker 1: on iHeartRadio.