In Nov. 2016, it may be the economy, stupid, again

Here’s what could put the US Presidential Race back on the traditional track of economics after endless debates both in the Republican and Democratic camps about immigration and national security. The US economy seems to be conveying an increasingly ambivalent message to investors.

On the one hand, the US unemployment has never been so low since the 1970s and companies have become optimistic about it resulting in higher consumption soon. On the other hand, the US economic growth in Q1 2016 has surprised many analysts and has been the weakest in 2 years up 0.5% vs. 0.7% expected.

As a result, the US economy’s recovery since the 2008 financial crisis has looked like an enigma that is an unprecedented two-side process. One side said the economy’s fine while the second one warned something’s wrong and not even Fed Chair Janet Yellen was able to bring any strong explanation about what’s going on and how it will further unfold.

This time’s different indeed. With the largest quantitative easing (QE) in history, the advanced economies and their central banks could have interfered with the laws of economics up to the point that it created conditions for unusual developments, for better or for worse.