Thank you very much. I'm Larry Kudlow with FOX Business. It's a great honor to be here today at this G20 meeting. Just a word about my good friend Scott Bessent, who is the 79th Treasury Secretary, as you know. And as I have said on several occasions, he is the best, most important wartime Treasury Secretary since World War II. We're here in North Carolina in a beautiful setting outside of New York City, outside of Washington, D.C., just to say that America is a beautiful place. And you know, we had the World Soccer Cup and the return—all those people who came here just loved it. This is a beautiful country, and we pledge allegiance to this country. And it's not all in Washington or New York City. Scott Bessent hails from South Carolina, as you may know. His family goes back hundreds of years, but he also has a place near here in North Carolina, so we're in this very beautiful setting. Having said all that, let me introduce the 79th Treasury Secretary, my friend, Mr. Scott Bessent, the Honorable Scott Bessent.
How'd I do? Did I get it out?
Keep trying, you'll get it right.
Thank you, I'll do my best. So thank you for this. I appreciate it very much. It's a great honor. We're broadcasting live for Fox Business. Scott, I want to begin—there's a very—newspapers are running a very odd story as though Treasury debt management for retiring off-the-run long bonds is the most important economic event, and it is not. And I want to make that as clear as I can. The most important event right now in the American economy is we are in an economic boom. We are in an economic boom the likes of which we have not seen probably for decades, if we're being honest about it. And I want also to add that this boom, in large measure, is a function of President Trump's policies and your policies, particularly the one big, beautiful bill, the tax cuts, the 100% depreciation. We are seeing manufacturing growth that we haven't seen in years. We are seeing construction growth that we haven't seen in years. We are seeing employment growth in those areas. We are seeing a phenomenal AI revolution that is building out our advanced technologies. It is the envy of the world. We are seeing a massive stock market rally. We are seeing enormous profits, which are the mother's milk of stocks and the lifeblood of the economy. To me, these are the headlines. You've been trying to get that out there a number of times. The media doesn't like to talk about these successes of the American economy, but I want to begin with that, because to me, that's the headline story.
Good, Larry. And thanks for coming down. This is a great part of the world—Blue Ridge Mountains out the window here. Asheville had a terrible tragedy about two years ago, Hurricane Helene, and these are resilient people. I grew up coming up here, as you said, have a house about an hour away, and to be able to showcase both this part of the country—and I hope all the G20 attendees will come back. I hope the people who are seeing Asheville and Western North Carolina around the world will come visit. And, Larry, it's exactly what you said. If we look at the composition of the bond yields, inflation expectations are flat to down—
—and this is a growth story. Growth, I believe, is reaccelerating. We have had some very good discussions here over the past few days, and everyone agrees that growth has been better than they thought it would have been given the Iran conflict. Now, everyone is always cautious going forward, but growth has been better. And as you said, the U.S. sits at a very special place in the world because we are the AI superpower. And we are pulling away. The amount of compute that the U.S. has relative to global compute—we're going to go up from about, call it 60% in 2025, by 2028 the U.S. will have 80% of global computing power here, which is just extraordinary. And as you said, the President's policies have laid the groundwork for this economy.
So we have regulatory certainty. The President tasked this administration with cutting the regulatory burden, and that's part of what we're talking about here today with the G20, with the 20 most important economies in the world and other countries that we've invited because we view them as systemically important and allies that, you know, come with us and grow. Because regulatory certainty, tax certainty, and energy certainty—because the U.S. is also the world's energy superpower. You know, we are now exporting energy to the rest of the world. So, I don't think that we are in any kind of a dire situation. And as I said yesterday, the bond market has been the best performing bond market. What happens over a month doesn't matter, but for August it was. And since President Trump came into office, since January 20th, 2025, it's been the best performing bond market among major countries in the world.
And the best performing stock market. The stock market—I say this all the time—profits are the mother's milk of stocks. Profits drive the economy. Front page of The Wall Street Journal yesterday, they finally ran a profit story. I've been waiting for this. This is the business newspaper of record, finally ran it. Front-page story—
Well, it's more of a teachers' paper now, and it's not The Main Street Journal.
I know. Profits, year on year—hang on a second—profits are up 53% for the S&P 500. Profits per share: 53%. Now, I read some of the economists on Wall Street; they're looking for future earnings of 25% year on year. Now, as you just said, let's go back to the one big, beautiful bill, all right? You have 100% depreciation. You write off your expenses. So we are in a capex boom. Nothing like it around the rest of the world. We are in a capex boom: machinery, equipment, buildings, of course, the AI construction. You did a tweet—what was it—105,000 goods-producing jobs year-to-date. That was a very important—
And, Larry, the preamble for manufacturing jobs are construction jobs.
So we are seeing, thanks to the tax bill, 100% expensing on equipment, 100% expensing on factories, and 100% expensing on ag structures. We are having a capex boom in factories. And the precondition for that is construction jobs. My hometown, Charleston, South Carolina, Boeing is doing a 50% increase in their factory there, which produces the Dreamliners. That will be a thousand great-paying jobs. But before that, there are construction jobs.
And so we are seeing this construction boom. And I don't know if you saw the other day, the construction unions came out and pushed back against—
Yeah, the data centers. The construction unions came back and pushed back against the data center backlash—
—and they said, we will go after anyone who attacks these because these are great projects.
Manufacturing orders, okay, in nondefense capital goods excluding aircraft: last three months, 16.2%; shipments last three months, 16.7%; backlogs, 9.2%; year on year, 13% increase, okay? We've never seen anything like this before. So here's my point: tax incentives work. That's important. Tax incentives provide growth. Deregulation provides growth. Drill, baby, drill—we are now, we are now, according to the Energy Department, at 13.8 million barrels per day, on our way probably to 14.5 to 15 million barrels next year. That's from the Energy Department. They have a little—
Well, Larry, the other thing, too, is my 3-3-3 program. And on the energy portion, it was the 3 million barrels per day of crude equivalents, and right now, if we think about crude, nat gas, all the other adjacent fuels, we are already up about 1.6 or 2.2 million barrels a day since the President's inauguration.
