Busy Economic Day

And the next 3 quarters look weak too


Note the surge in inventories of people trying to beat the tariffs

Basically panic buying

The US Commerce Department has reported that GDP fell at a 0.3% annual rate in the 1st quarter, well under the forecast of +0.4%.

This was largely driven by a decline in US exports driven by Trump's trade war.

Hoocoodanode?

I'm sure that the response of the Trump administration will be to replace the statisticians who compiled this report with their own evil minions.

The U.S. economy contracted in the first three months of 2025, as businesses rushed to stock up on imports ahead of the Trump administration’s tariffs and consumer spending slowed.

The Commerce Department said U.S. gross domestic product—the value of all goods and services produced across the economy—fell at a seasonally and inflation adjusted 0.3% annual rate in the first quarter. That was the first contraction since the first quarter of 2022.

Consumer spending, the economy’s main engine, rose at a 1.8% pace in the first quarter, the smallest increase since mid-2023. Spending by the federal government fell as the Department of Government Efficiency cut jobs and contracts.

But the main driver of the first-quarter contraction was Trump’s trade war. Net exports, the difference between what the U.S. imports and exports, subtracted nearly 5 percentage points from headline GDP. That was the biggest quarterly drag from net exports on record dating back to 1947.

………

Trump has made tariffs a cornerstone of his economic agenda, saying that they will in the long term make America richer and bring back manufacturing jobs. In March, the trade deficit in goods hit a record as businesses stocked up to get ahead of tariffs.

Trump is, of course, saying that this is all Biden's fault, because ……… The Aristocrats!!!

Meanwhile, private sector job growth fell to 62,000 according to the private AD?P report.

This is well under what is needed to account for natural growth in the workforce so it points toward increasing unemployment.

What is going on here is pretty simple, employers are willing to hire in the face of risk, where they (roughly) know the chances of the sh%$ hitting the fan, but they are NOT willing to hire in the face of uncertainty, where they have no clue what will happen from one day to the next.

This is what happens when trade policy is being run by a meth addled chihuahua.  

Friday should be interesting.