Economic Growth and Inflation

¶ … macroeconomic themes that have been taught or covered in this course is economic policy and its role in determining or influencing economic growth and development. Economic policy is a subject that has attracted considerable attention in recent months because of the presidential elections in the United States. Actually, monetary policy was one of the major issues in recent presidential campaigns and elections. This issue has also been subject of several publications by different new sources because of its significance in the country's economic growth and development.

Paula Dwyer wrote an article to examine the recent rise of the Dow Jones Industrial Average in the aftermath of Donald Trump's election as the U.S. President. This analysis was carried out on the premise of the impact of Trump's economic policies on different aspects of the economy. The U.S. market has shown indication of its approval of Trump's economic policies in different ways including the rise in the Dow Jones Industrial Average.

After reading this article, I have seen the significance and role economic policies play in a country's economic growth and development. In this case, the increase in the Dow Jones Industrial Average by approximately 9% and close to the 20,000 mark for the very first time is an indicator of the impact and approval of proposed economic policies by U.S. President-elect Donald Trump. This implies that suitable economic policies help in improving economic conditions and market trends.

The rise in the Dow Jones Industrial Average is attributable to the market's approval of Trump's tax-cutting measures, deregulating and deficit spending regulations that are customized to enhance corporate profits (Dwyer par, 2). The rise in Down Jones is an indicator of enhanced corporate profits that are brought by these economic policies, which are business-friendly. The business-friendly policies are expected to lower corporate costs, which would in turn enable stock investors to get a huge share of the economic pie.

Additionally, economic policies influence economic growth and development through affecting the bond market, stock market, inflation, and interest rates. Policies are usually developed and implemented based on the existing macroeconomic conditions. In this case, they are usually implemented to deal with challenges in the macroeconomic environment and boost economic growth and development. When developing economic policies, the existing market conditions are also considered to help in ensuring that the policies would have positive impacts on markets and the overall economic status.

This article has changed my understanding and expectations for the future by highlighting the probable impact of Trump's policies on markets and economic conditions. Based on the information presented in the article, I expect faster economic growth in the future as Trump's policies are enforced. Businesses will have friendly operational environment and conditions because of favorable policies. I also expect several changes to proposed economic policies, especially in relation to monetary policy, wage and price inflation, and budget deficits.

This is primarily because some of the proposed economic policies could end up weakening the economy through worsening inflation, huge deficits, and increased borrowing costs (Dwyer.