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- đşGDP Growth Is Officially Negative...
đşGDP Growth Is Officially Negative...
Are we in a Recession?
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GDP is officially negative.
But last quarter wasnât a typical set of circumstances.
Hereâs why the official GDP numbers from last quarter donât mean much:
Last quarter's GDP drop came from a ~40% surge in imports from companies preparing for upcoming tariffs.
Because one component of GDP is exports minus imports, GDP was officially negative.
But that was short-term noise.
If you remove that import surge, GDP displays a 4.5% growth.
Anyone can pluck numbers out of an equation and create a narrative.
But because the import surge was a one-off spike, itâs justifiable.
Anyhow, letâs look forward.
Trump claims the US has $8 trillion in new investment commitments.
Although I couldnât identify all $8 trillion myself, hereâs what I found:
⢠Schneider Electric $700 billion
⢠SoftBank $700 billion
⢠Nvidia $500 billion
⢠Apple $500 billion
And several other smaller commitments from Amazon, Toyota, etc.
Will these commitments raise GDP when fully implemented?
Highly likely. Theyâll create new jobs, investments, infrastructure, etc.
Productivity will rise, and since people earn more, theyâll spend more.
So there you have it.
Donât worry about Q1âs GDP.
Great investors have a forward tilt.
Be cautiously optimistic, donât be a perma-bear.
If youâd like an in-depth breakdown of what's going on,
@profstonge has an excellent video on his timeline!
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