Two cheers for the USMCA

SAT, JUL 13, 2019

YOUR AFTERNOON NEWS UPDATE AND MARKET ACTION FROM CNBC

AS OF FRI, JUL 12, 2019 • 12:00 ET

DJIA		27332.03
		+0.90%	+243.95

S&P 500		3013.77
		+0.46%	+13.86

NASDAQ		8244.14
		+0.59%	+48.10

EDITOR'S NOTE

Hi everybody...

With apologies for interrupting your weekend, it's important I straighten something out regarding the U.S.-Mexico-Canada Agreement we discussed yesterday.

Boosting GDP by 0.35 points a year, I said, is not to be taken lightly--that's a huge growth stimulus.

Too huge, in fact. The International Trade Commission's estimate is that USMCA will boost U.S. real GDP by 0.35% total after full implementation, which they estimate would take about six years (page 43 of the report).

I know that's not nearly as exciting. But it's still nothing to sneeze at. As Politico pointed out, "compared with other free trade agreements, [USMCA] would generate a higher growth rate"--the Korea agreement giving an estimated 0.1% boost, and the vaunted Trans-Pacific Partnership would have been 0.15% over 15 years.

Look, this stuff is difficult to quantify, but at least the data show us the directional impact to the economy. Meantime, if anyone has a way to boost GDP by 0.35 points a year, I'm all ears.

Enjoy the weekend, and I'll see you next Monday. We have some great stuff lined up for The Exchange next week while I'm out--and if you'll indulge me, I've got some different things up my sleeve for the newsletter next week as well.

See you soon!

Kelly

Kelly Evans

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