As I have said many times before, and particularly over the past four weeks, we can't allow the markets to be our barometer of the success of this president or the growing success of the U.S. economy. Certainly, we will likely look at the markets to give us a sense of how we might perceive the direction of the economy. But we are seeing a very opposite effect in the past 12 months than we saw during the previous administration.
For eight years, I told people not to get excited over a strong market, but instead to keep their focus on the underlying fundamentals of the economy. A strong market with eight years of 2% GDP growth does nothing to help the average American. It is only a strong economy that will continue to impact America in a positive way. If we have that, the markets will take care of themselves.
The only thing that drove the markets in the previous administration were false positives created by financially engineered corporate earnings, the Federal Reserve and central banks globally. Today, we have just the opposite happening. The underlying fundamentals are strong, and we have the potential to see sustainable growth—if we can keep inflation in check and the economy from heating up too fast. However, that will be no easy task.
A few things that can derail this economy are raising interest rates too quickly, inflation coming up quicker than anyone expected and, of course, we must keep our eye on geo-political events that could disrupt and derail growth, such as an interruption in the flow of oil globally, a large-scale terrorist attack, or worse.
For the first time in 10 years, we are seeing a Washington that is actually talking about fiscal policies and fiscal responsibility. Even though we know this is Washington, where talk is of little significance, the difference now compared to years past is this: We now have something in Washington that has been lacking for many years, when dysfunction was prevalent. And that is leadership.
It was not dysfunction in and of itself, however, that created the problems in Washington. Dysfunction is only the effect of the cause and the symptom. The cause was/is an unprecedented lack of leadership. In fact, I would submit that this lack of leadership has been our problem politically, economically and socially. But the leadership we are witnessing today has taken a good eight to 10 months to actually trickle down to the conservatives in Congress, the Cabinet, leaders of important committees and other areas of the government.
It would appear as though the dysfunction is, at least on the conservative side, slowly being eradicated, replaced by resolve, strength in leadership and a commitment to American values that has not been seen for many years. We are witnessing what good leadership does; good leaders put forth an agenda of America first that has the best interests of the American people and national security at the core. Conservatives in Congress seem to have adopted the cornerstones of the foundation that America can build upon, move forward on, and be proud and excited about new economic opportunities.
We need to be less focused on what the markets are doing and more committed to understanding that the underlying fundamentals of the economy are strong, and continue to grow stronger each and every day. And the economy will continue to grow, as more and more of corporate America sees the potential that has been hindered for a long time.
Corporate America is looking at a Washington that is creating an environment where growing their company, increasing their workforce, participating in employee benefits, paying fair wages and building a labor force that will create a competitive environment becomes easier in this increasingly free market economy. These are the things that made America strong, and these are the things that will take America back to where she once was.
I was amazed at the damage that one administration could do in eight years, and I pray we will be equally amazed at how another administration can undo that damage in an even shorter period of time.