Animal spirits are perking up

Over the weekend we had dinner with friends in north San Diego County. His firm provides consulting services to other firms that are in the initial stages of planning residential and commercial projects in the area—projects that won't be finished for 2-3 years. "Last summer was the worst summer we have ever had," he lamented. New business all but dried up. But days after the November election new business began pouring in. He's busier now than ever before.

This squares with what I have been thinking for the last six months or so: faced with the extreme uncertainties surrounding the election, decision makers would be compelled to put new projects on hold, thus weakening the economy. But now that Trump has won and it appears likely that he is going to advocate for reduced tax and regulatory burdens, decision makers are much more willing to pull the trigger on major project decisions. If "animal spirits" are perking up even before tax and regulatory burdens have been cut, imagine what might happen if and when they actually are.

This is only anecdotal evidence, to be sure. But I'm pretty sure that next year promises to be a much better one for the economy.

UPDATE (11/13/16): The NFID Small Business Optimism Index jumped almost 4% in November, thus providing some corroboration for what I learned from my friend.