What’s Next For The Economy In 2020? | NBC News NOW

Channel: NBC News
Published: 12/25/2019 12:27 AM

NBC's Ali Velshi discusses how 2019 was a strong year for the economy and how it could play a role in the 2020 election. » Subscribe to NBC News: http://nbcnews.to/SubscribeToNBC » Watch more NBC video: http://bit.ly/MoreNBCNews NBC News Digital is a collection of innovative and powerful news b...

The economy ending the year on a strong note, stocks near record highs the federal reserve slash rates during the year. The phase 1 china trade deal ready to be signed in january. We'Ve got our nafta 2. 0. These are some pretty big accomplishments for president trump. So what does that mean going into 2020? Well, of course you know who's here for asking these kinds of questions my friend ali velsh ...
, to talk all things economy ali. If we take a look at it, i mean look the economy's pretty good right. We'Ve got a gdp around 2 % unemployment at 4 %. I mean yep three and a half percent unemployment yeah. It'S pretty good. You and i were talkingabout this earlier on msnbc and sony tweeted us and said you know: ninety-three percent of americans. Don'T look at that stock market and say wow look at my portfolio, so i just want just hit that point about have 40 percent 40 some-odd percent of americans own stocks, most of that is through a 401k and unless you're, a uniquely bad investor, the stock market Is up 28 % year-to-date right? It'S it's a very, very big game, so, actually about half of them.

If your money is in the stock market and in something it looks like the s & p 500, which is generally where it should be, you did actually do very well on the stock market. Here'S therest of it three point: five percent unemployment should mean that everybody can go to their boss and ask for a raise because they're short of workers that didn't materialize across the board. Two percent gdp growth, it's abstract to people, they don't really know what that means. Right so the stock market and wages or the value of your house, those are the only places where it materializes yeah and you have a house if you've got money, if you, if you're a higher age, higher earning wage earner, you've done well in the last few Years where we're stuck is sort of in that middle class to do lower, there are still people in this country earning $ 7. 25an hour. There are still people homeless, there's still people food insecure. So there's something weird about it, because if you were just looking at all those economic, not you'd say this is great yeah things are good right, it's just not properly distributed. That'S what the issue is so do you think i mean? Could we see president trump running into trouble in november? Well, you know, as he heads there walking around saying with the economy's great the economy's great. Does that open up room for the democrats? They wait a second, it's gon na be the same problem that barack obama face is gon na, be the same problem that a democratic candidate faces, except that some of thesedemocratic candidates are talking about universal health care and higher minimum wage, because donald trump went to ohio In the election said, don't sell your homes, well, everybody who didn't sell their home, probably as a home. That'S worth less now, because more factories have closed. Jobs have gone away. Coal mining jobs didn't come back, so there is a problem because the rich got richer and that's the way the world is going right now along the developed world, but he promised things to manufacturing workers, coal workers that haven't materialized because he can't make them materialize.

The fact is, that's not where things are so the challenge is going to be for those people and there are manymillions of them right. There, 40 million food, insecure people in this country, so there are tens of millions of people who are sitting there. Looking at this remarkable stock market more records, we didn't, we got two new records today, a one new record on the nasdaq, but, generally speaking, we've had a record-breaking stock market. They'Re looking at home prices go up, go up, they're! Looking at this gdp growth, they're looking at low unemployment, they're saying, like i've, been 10 hours into an economic expansion, we have that recession for 10 years, all right. So let's talk about that because you - and i also talked about this before i kind of looked - you said - i'm not afool you're, not a fool. We know that the next year is 2020, but think of my brain. Didn'T look like wow a whole decade coming to an end and a whole decade without a recession right, it's real, that's great, but then people start to think well. Does that mean one's coming yeah and i would have to say this. I think one always comes yeah with a mug's game trying to prove when it's gon na come and if you're adjusting your investments, because you think ones coming. I wouldn't do that. I'D stay nimble, but i'd stay invested. The the issue is they come.

They don't all have to be like the last one. The last one cameit could have been a garden-variety recession, but lots of things complicated it and it made it into a jungle variety recession. We don't have to have that. One of the things that happens is central banks which, who acted very well last time around. They can lower rates and they can stimulate the economy. The problem is that trump has been putting pressure on them from lower rates all year and they've been doing that, which is fine. It hasn't hurt the economy's probably helped the economy, but the fed. That'S the fuel in the tank for central banks, the ability correct and if you have no fuel in your tank when a recession comes, that's dangerous, so that'ssomething to think about over the course of the next year. All right so we've talked about also the china trade deal. I know that that seems to be in a sense, a phase one deal done, we're waiting to see if they sign that in june people have been so concerned about this trade war. Should that calm people down yeah, it should remember a year ago. That'S why, if you've wonder why you've had a 30 % increase in your stocks? It'S because a year ago, we were all panicked about a free fall, because we were going to get into this trade war with china.

We got into the trade where we got in china, trade war. Ayear ago we were in a trade war with china and canada and everybody else now we've got this u. s. mca. We'Ve got phase 1 ish kind of with china, so it's probably not going to get worse, but for people looking at our trade issues with china, we haven't really improved on anything. What we've done is we've just we're just not in the war so yeah. It makes people people feel better, and i think that the president and investors will sit there and say all right. We like it better when we're not in a trade war, so let's not be in a trade war. So let me ask you this and i hate to be thenegative nelly. That looks at these positive things and says: are they a problem, but ok, if we've gotten the trade, where issues kind of out of the way, if we've gotten the nafta problems out of the way, if we have kind of cut, fed rates and people kind of Like to see that last year, does that mean that, as we head into 2020, what we don't have these events, these things to look forward to that might give the economy a boost. I'Ve never in 25 year career being able to adequately predict what the next bad thing is going to happen. Economically.

Sometimes, i'd be calling this it from my yacht. Sometimes it's event-driven because thingshappen in the world and they cause a recession or an oil spike or and sometimes it's just the cycle. Yeah and we've not figured out the smartest economic minds have not figured out how we create a world in which we don't have ups and downs. So i would say this we're on a wave it's going on right now. We should try to enjoy it. We should try and hope that all those people have not been caught up in that wave somehow get to participate in that, but be prepared for things to happen, because economic expansions that are 10 years old are long in the tooth and and they can crumble again. Also, i'm not askingyou to predict the future or tell people what to do with their money, but some people might watch this and think all right allie. I have made some money last year. Yeah a lot of things happening next year. Stay nimble. Should i get shane? It will stay nimble, stay aware of what's going on, if all your money's in the market right now, i don't think it makes sense to make sure you're balanced and you're, where you should be because you're, probably out of balance, if you last checked it a year Ago or less change things around, but stay nimble be ready to hear the cues. Generally speaking, a market doesn't just crash right and wedon't know wake up one morning, and we don't do that.

But you might hear cues that things are slowing out what you and i will be talking about economic numbers that indicate that things might be slowing now, we'll give people a lot of cues now at that point those become tough decisions. Do i get out? Do i stay? What do i do? I don't think there's anything today that says there's something impending that is going to be uniquely dangerous for you as an investor. So that's great news. It'S christmas. Even you don't see anything uniquely dangerous today, we'll take it from the ticket. Take it on a day-by-day basis. I leave i'll, see you thanksso much for spending so much other pleasures. Merry christmas, hey nbc news viewers, thanks for checking out our youtube channel subscribe by clicking on that button down here and click on any of the videos over here to watch. The latest interviews show highlights and digital exclusives thanks for watching.

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