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"Whistling past the graveyard" vibes

This is probably true but I am still gonna keep refreshing the deus ex machina charts.

To slightly mix metaphors, eating the seed corn produces a sugar high!

“I've been looking at the global economy for a long time and I can't think of any time in my business career where I've seen such a strong global economy” —Hank Paulson, July 2007 home.treasury.gov/news/press-r... He wasn’t wrong, exactly!

Some of it is going to non-oligarchs! Few of us feel good about the process, though, so the sour mood is attributed to the economy overall.

Saying you're unhappy with the economy is seen as more socially acceptable than saying "the President is a nut" or "the pandemic has frightened and confused me so that nothing seems normal."

And he hasn't pushed every negative button. Hypeescalers allowed more room to roam than they would have in a Harris Administration.

The Midwest, particularly the State of Michigan, saw an outsized amount of economic damage from the tariffs and the repeal of the Inflation Reduction Act’s EV policies.

The reshoring, AI and military boom drive headline statistics but once that engine sputters what's left? With tariff barriers, oil policy support and endless war you have inflation and high yields. Without those artifices, whole swathes of the US economy will be eaten up by Chinese competition.

Moderate effect on the overall economy maybe. Yet an enormous negative effect on many ppls day to day lives and the future cost of an America that nobody trusts. But yeah, the economy is ok at the moment 😏

The economy is on a sugar high from data center investment. We’re partying like it’s 1999. The correction and fallout is coming. Right in time for the entitlement demographic cliff.

Trump walked into office with a capex boom and super charged it with tax breaks for big tech. Whatever negative things he did were counterbalanced by an extraordinary capex cycle. Also, the US economy is amazing and diverse. It takes a lot to sink it.

You may also be hearing from people in certain industries. I realize you are taking the macro view but in my industry his policies and decisions have impacted us significantly.

the latter

Trump's policies aren't the sort that trigger immediate disaster. Instead, his more closed U.S. economy, rejection of immigrants, and cronyism will slowly degrade economic activity. Fiscal largesse offsets that erosion for now, but the higher interest rates it provokes will take their own toll.

Charts For Dinner

sure, don't disagree with that

He’s more of an economic disaster than Biden, and the Biden economy hurt Biden’s popularity a ton

Hit 'em with that TRUTH, George! Losers out here whining about Trump can't see they're living in the best time in human history while he's in office. Wah wah prices are too high, lol get more money then you broke bitches. Love to see you own them with reality. Keep it up, I love your posts!!

Everything is fine until suddenly it’s not. >At some stage the AI spending boom must be paid for with profits. Good luck with that. (cf. Late 1880s railroad boom) >The oil situation is only going to get worse. This is inescapably inflationary.

In terms of elections though, remember - voters don't care about the wonky stuff. The Biden economy was solid & Trump won on the basis of a supposed "terrible" Biden economy (assist from RW propaganda). It's the vibes that count, & there's nothing that affects "the vibes" more readily than >$5 gas.

💯☝️ Fiscal policy is incredibly stimulative but since it is debt financed, isn't that just pulling forward future growth that younger generations will have to pay for either in higher taxes, slower growth or both?

I’m sure 5-6% deficits at a cyclical peak with an AI super boom, spiking oil prices with a pointless war, deporting all the cheapest hardest working labor, cheapening USD by destroying trust with trading partners will not have any inflationary consequences

Granted, I said that when he started the trade war and the market has been ignoring me, so what the hell do I know.

? Brent is over $110 and headed into this year we were on pace for a record glut.

yeah, I’m sure the economy feels really good if you happened to buy stocks and assets in 2022.

We're nearing the bottom of the push stroke on the accordion economy.The music is about to stop & pull stroke is going to be #Kleptocrats & #Oligarchs sucking the last $ out of #US , bunkering down & fomenting chaos to avoid the Le Rasoir National.The ballroom is his Führerbunker HE'S NEVER LEAVING

Isn’t the distribution of that income an issue? (Not just an issue for the economy under DJT)

it is staggering how the economy is in aggregate good and he is *this* unpopular.

Yeah there’s been a cultural shift from a healthy Sometimes Very Smart People are Wrong (ex Iraq War, Great Financial Crisis causes) to a very toxic Experts are all Liars (MAGA, alleged pandemic missteps, vaccine skepticism)

You should do a pod episode on this. Would be curious to hear your thoughts. I marvel that it's doing as well as it has, but it seems to chug along contra my expectations. Invite Will Stancil on as guest [hides...]

This reminds me a lot of the economy discussion in 2024. On paper things look good yet people feel like they are struggling. In this case the phenomenon is to our benefit since Trump is in office and thus taking the blame. His approval rating on the economy is what matters the most and it is low.

Sure, this might all be fine especially if expectations hold up but it is increasingly looking like having to be lucky every time.

I agree. To me, the risk of recession seems far more likely from a sudden crisis than a controlled slowdown (although an externally-driven slowdown might be the trigger for the crisis).

Another way would be, a widening divergence away from targets. So not a disaster but failing to meet goals, for which, as the micromanaging, finger in every pie autocrat that he aspires to, he does bear the preponderance of responsibility. Even though much of it is a collective failure of will.

The important question is the size of the loss vs the non-Trump counterfactual, I guess, given factors driving economic performance that Trump has had no effect upon.

whatatake.com/c/k5mpjtk6ksny

some of us may be experiencing dissonance because the economy being in a great shape has nothing to do with a way that ‘greatness’ is distributed across society? there must be some social value measure that can be applied to Economy that would tell us more accurately how we’re doing?

While you’re cooking, do you have an explanation for the warehouse construction fall-off? bsky.app/profile/jose...

It's creating marginally slightly more goods at a significantly higher human cost while the Administration actively hampers it's ability to achieve peak performance. Not really a mystery why people think it sucks!

Trump should be getting the Obama post-2008 bitchfest of "should be better tho"

Beyond that 15mos, seems like Uncle Sam is currently boxing with one arm in a sling. If we stabilized the tariff craziness, forcefully pushed renewable energy conversion, accelerated federal housing construction in smart places, decided higher ed research was a priority again, growth could jump, no?

It may be more like X under Elon Musk; a slow painful decay. On the other hand, it's hard to judge just what will be a tipping point; some apparently minor problem might lead to a dramatic failure.

I guess we will see. In my experience, the combination of rising oil/food/energy prices, stocks trading at high multiples, above target inflation and rising interest rates doesn't always end well.

I have to admit I am a bit surprised by the state of the "economy" I am a trained economist-not paid since grad school I generally agree with you here. The problem, however, is the micro. That is a mixed bag with some extreme situations. The zip code effects seem to be at some record levels.

Q3 is tracking 4.8%, consensus forecast has us at 2.1% for 2026 CY (and given 2.1%, 1.5%, and 4.8% would be on the low end). No question that GDP has slowed in 2025 but there's no indication it will slow further, and it's happening with extremely low jobs growth that is now flipping the other way.

I wouldn't use the payroll numbers as a proxy for labor market health. Like it's just hard to get those numbers up when 1.) working age population is flat 2.) PAEPOP is high.

So when you say above growth above trend, I take that as at least 2.8%. And by rising employment, that means, what, at least 100k average monthly jobs growth—which would still be lower than 2017-19 or 2021-24—instead of the recent stagnation or decline? I'll readily take the under on both of those.

While 15 months is pretty realistic to be "decent", the energy chocks and the worse relations with the rest of the world mean that there is a very real risk that things can hit a major imbalance very rapidly. Food, fuel and gambling on multiple ventures leave the US economy less stable than before

I think it comes down to: 1. Does the AI build slow, stop, or crash out, and when 2. What sectors, if any, take up the slack 3. 🤷

another shill for Big Reality

it's true, anyone who sets the desktop terminal to orange-on-black with a semi-heavy font is probably better at The Economy than i am.

Are you saying that I will be able to afford a house one day, or it's a great economy even though I won't?

Fair. Just feels like people can't reconcile new prices and new wages are equal or preferable to old wages and old prices. It's a weird one. I'm in maga country so I still hear the "didn't you love the 1.85 petrol during 2020" silliness on a somewhat regular basis

In fairness it's quite difficult for a president to screw up the economy. He's doing his best though.

the true horror of Glonzo is that it lives within everyone, incubated from birth, waiting for a chance to escape with the host's particular strain of mutation in tow. "charlie brown had hoes" and "charts aren't real" are the same Social Contagion Cthulhu/actual breathing Descartes' evil demon

It's a "dog bites man" story if there ever was one, not hard to figure out.

If one asset class looked poised to shine under Mr Trump’s second administration, it was cryptocurrencies. He had pledged to make America “the Bitcoin superpower of the world” and created a strategic bitcoin reserve in March.

lol

Instead of stagflation (economy not stagnant) it's humiliflation (inflation because we entered our decade of humiliation)

My guess is that people lose objectivity on “the numbers” because of frustrations with the fairly loud criticism by Hedge Funders, etc of Biden while being quiet regarding Trump’s corruption and policy buffoonery. Trump is bad for long term (5-10 years) peace and prosperity worldwide IMO.

The question though is that there seems to be something downstream of "the economy" that has people mad at trump in a way they weren't mad at him in 2018 (his economy favorables are way lower now than then), and I'm not sure what that something is other than maybe prices.

People have a real issue with reading descriptive information as an endorsement.

Yeah, but elections don't care about how the economy *actually* is. Voters will reject their literal person life experience over what everyone "knows". See: 2024.

I mean, would it have been fair to say that the economy was good in 2006?

There will be a lot of deferred costs due to the deliberate sabotage of big sectors (e.g. Higher Education) the pain isn't being felt yet, but the injury has already been inflicted.

There are two American economies -that's what the K-shaped statistics show. In the aggregate, it is in OK shape. But the gap between the haves and have-nots is growing and the number of haves is shrinking while the have-nots increase.

Came to say something like this. Feels like there is an overhanging wave of consequences due to his erratic policies and general management style, that just hasn't hit yet. Maybe it never will, but that would be bad for future generations to see this is/was a consequence free presidency.

Reduced immigration. Gutting our universities/research system. Gutting public health. Ignoring climate change. Gutting the State Dept., military leadership and the SEC/financial regulation. I could go on…

Another one in potential damage to future growth (though it's unclear to me if the scale means it's "actual damage, mitigatable" versus "trend that continues to actual damage if allowed to run") is the effort to limit electrical generation capacity growth to fossil fuel plants.

Hard to quantify but I’d add two things: increased uncertainty due to frequent policy shifts and even more difficult to quantify but I think the lasting effects of the deterioration of US standing in the world will also have consequences (believe the latter under appreciated in DC and more broadly)

Exactly. In the long run we’re all dead, but too bad about our kids.

If you had to put years to the terms medium and long term, what would you say?

Exactly what Darling said. The lags on horrible, destabilizing, policy can be very long - so long that these idiots will be gone. So your rhetorical point isn’t helpful. It’s not obviously in the numbers but it’s hurting a bit now and theoretically will hurt so much more later.

See @socio-steve.bsky.social's write up: rooseveltinstitute.org/blog/the-irr...

oh brother you and me both. Or at least, me formerly. Going back to school for construction management now after a year with no luck.

even if that can coexist with (slightly reduced) economic growth and an otherwise stable/good economy. Life for folks in the lower hand can/will get even worse as HCBS and rural hospital systems collapse. But the economy is BIG.

also Xi saved the world from Trump's oil recession

Was trying to conceptualize this though (unfortunately I’m too dumb) but that a president can basically individually have a measurable, albeit small, negative impact on future growth feels really bad

It’s also my assessment. Brexit didn’t massively impact the British economy overnight, it took a few years for the negative effects to materialize in noticeable ways.

Agree, disaster is way too strong for short-term condition though I would argue that supply destruction + inflationary policy (war, tariffs, ending Obamacare, immigration) has been very harmful in the short term

Causing economic damage that will be hot-potatoed to the next president (if there is a peaceful transition of power)

People pictures he is a thunderstrom but he is actually climate change

Lol 🤣🤣🤣.. what's funny? Who else is laughing 😁

When you stop to think about it, the reason we “want” the economy to fail is so that Trump will be catastrophically unpopular and so democracy saved. But he’s catastrophically unpopular as it is! It’s good if we can have this, while the economy remains fine.

thoughts on risk of a credit shock as everyone dumps gov bonds around the world?

The sweet spot is for the economy to be good but for people to hate trump on the issue anyway, looking good on that front.

Enshitification was created as a tech term but it’s really a widespread phenomenon. Including the economy. We’re living in the enshitified version of the economy. Less growth. Higher prices. Fewer goods available in the store. But hey, we got to be mean to brown people so nobody cares. Not great.

One of the upsides of trying really hard to swim upstream to accomplish specific arbitrary goals is that if you just turn around there are usually some quick wins