- If you’re struggling to make sense of the economy today, you’re not alone.
Many so-called experts completely whiffed their forecasts, while positive economic data — the Dow Jones Industrial Average at 50,000 points — seemingly contradicts negative survey responses.
But understanding five key elements reveals we’re about to be off to the races.
- First, 2025 was a year of transition for the economy. Under Democrat President Joe Biden, particularly his last two years in office, job growth was disproportionately due to government hiring. Similarly, government purchases played an outsized role in growing overall economic activity, as measured by gross domestic product (GDP).
- The second element is the distinction between inflation and prices...
- Even if Congress doesn’t act, the good news is that income growth is helping solve the problem, albeit more slowly, and that’s the third element which has changed significantly in the economy...
- Because the economy is growing faster, tax receipts to the Treasury are up 11.8% this fiscal year...Shrinking the unproductive public sector while growing the private sector is a welcomed change, but it initially shows us as a negative in many economic metrics...
- That brings us to the final element: investment. Between tax and regulatory cuts along with Trump’s trade negotiations, trillions of dollars in investment are pouring into the country...
After years in the doldrums, the finish line of prosperity is fully in sight.
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