Brian Beaulieu, CEO of ITR Economics, cuts to the chase to help ECPs understand what 2018—and beyond—holds for their business


There are only four things any of us can do with our money. They are: Spend, Invest, Save, and ___?

(Answer provided below)


The rate of growth will likely diminish as we go through 2018, but, overall, most people will find ways to grow the “top line” (e.g., revenue, sales). Growing the “bottom line” may be problematic. The general economic rising trend essentially stalls out for most of 2019.

The consumer ultimately determines the fate of the economy, and the consumer is out there spending money. That is a favorable sign in terms of seeing our economy grow further in 2018. The timing of recent swings in the leading indicators and the general upside momentum in the economy tell us that 2018 is going to be a good year.

Retail sales came in 3.6% higher than a year ago for the third quarter of 2017. This rate of growth is sufficiently strong to portend ongoing ascent in the general economy.

Abetting the rise in consumer activity are:

Low energy prices

Low interest rates

A rising stock market (as of press time)

Rising wages

Low unemployment

Energy prices are likely to be flat for most of 2018, and we are forecasting that interest rates will go up (albeit only gradually).

The stock market is looking overvalued, and a correction (10% to 15% decline) would not be surprising or unwelcome. A decline in share prices could easily contribute to a downward shift in the rate of ascent for the overall economy.

On the plus side, ITR Economics projects unemployment to stay low as wages are climbing higher.

There are a couple of worrisome trends/probabilities for 2019 beyond the developing weakness already evident in several leading indicators. One of the more subtle signs of a slowdown in the economy is the amount of money people are saving. The savings rate (as a percentage of after-tax income) is down to 3.1% as of September 2017.

The savings rate reached a lofty 6.3% in 2015 but spent most of 2016-17 edging lower. The level of personal savings is declining in dollar terms.

Both trends are a harbinger of the consumer spending less money in 2019. This is empirical input that the business cycle issues of 2019 will most likely be B2C and not B2B. Unfortunately, this industry of ours is primarily in the B2C space.

There is not much that the president and this Congress can do to change the outcome for 2018 substantially. It takes time for changes in legislation to have a material impact on economic trends. This is true of tax changes, imposing trade barriers, immigration, and health care.

Pop Quiz Answer: Give it away.


An economist with ITR Economics since 1982 and its CEO since 1987, Beaulieu is also chief economist for TEC, a global organization comprising more than 13,000 CEOs. He has also given seminars across the country to thousands of business owners and executives, with a focus on applying ITR’s economic research on the practical business level. Prior to joining ITR,he was an economist for the U.S. Department of Labor.