The New York Times says The Market Is Betting Trump Will Bring Higher Inflation and Interest Rates. “When the government pours hundreds of billions of dollars into infrastructure when there is mass unemployment, it can help put those people back to work and turn it into higher economic output without creating inflation. But when nearly all the people who want a job already have one, that spending just bids up the pay of people already working, eventually resulting in higher prices more broadly.”
Money reports What President Trump Means for Interest Rates — and Janet Yellen’s Job. “A massive increase in fiscal spending to rebuild roads, bridges, and airports, combined with vast deficit-spending in the form of a tax cut, may lead to more money swirling around an already relatively health economy. If you include Trump’s threat to impose a new tariffs on Chinese and Mexican goods, the cost of goods that Americans buy at Wal-Mart and Costco could rise by about 3%, according Moody’s Analytics”"