This was the expected result. The economy does not like uncertainty, and it is almost impossible to plan ahead until there is some clarity how and when the current trade war situation will resolve. The longer that takes, the worse the damage to the real economy will get.
Unfortunately housing will still not get cheaper because nearly the entire supply is locked into 30 year loans at near 0%, even a fool would starve, default their car note, and sell their every last valuable before giving that up.
Funny, I did not hear him talk about how the economy would tank and people would have to "sacrifice" or growth would "take a while" when he was running for president.
And just as inflation was down to a level where the Fed would be comfortable enough to start cutting rates, this administration came into foil all of that. Even if you really believe in these policies, which is highly controversial, one has to wonder why they timed it so soon basically forcing the Fed into a corner. It's as if this administration has a mandate to destroy the US economy.
I'm starting to think current measures of "the economy" are bogus. It can't grow indefinitely – that's probably just inflation. If you measure productivity in hours rather than dollars, inflation gets a more direct measure: how many hours do I need to work to buy food?
Making a better product than last year is also a strange way to claim growth.
> This is Biden’s Stock Market, not Trump’s. I didn’t take over until January 20th. Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our Country will boom, but we have to get rid of the Biden “Overhang.” This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other. BE PATIENT!!!
I'm curious how long he will get away with denying reality like this. The economical situation is likely to have much more immediate effects on people that almost every other topic. It should be much harder for him to do his usual thing once the economy really crashes, but who knows how his supporters will actually react.
Why did snap not give second quarter projections? How will the economic uncertainty impact advertising? I thought that should be immune to an extent unlike Amazon or Walmart which are directly impacted.
I got my quarterly report from my RIA. I pay them 1% annually of my holdings which is about 50k. They basically said expect a lot more major portfolio strategy change if the tariffs aren’t lifted. Every paragraph said the current policy is dangerous, in a different way, without attacking trump directly. Been with them 15 years and they’ve never sounded this worried.
This is just getting started, too, since the first half of Q1 was continuing to grow at the previous rates. Tge Atlanta Fed was projecting growth just under +2.5% until late February, and is now forecasting -2.7%:
I’m curious if any Trump voters are starting to feel any buyer’s remorse. The pain from the tariffs is only going to get worse. Soon we will have Trumpflation and a Trumpcession. Meanwhile, auto manufacturers are laying off employees. We are seeing pain with no gain. There is no reindustrialization nor will there ever be through this policy. For every economist except for Navarro, this is quite the own goal. I’m guessing you all were expecting Trump 1. Any doubts creeping in yet?
Slightly meta, when looking from outside, reading here feels like having your friends in the much-bigger-than-the-Titanic ship comment on it while the ship that was the emblem of the world sinks. The worst part of it is that every person outside of US watching this have a little demon sitting on their shoulder repeating, "They voted for him. A second time! You can't pity them." But I will say it anyway: stay strong.
It will be interesting to see what happens in Q2. I assume a lot of people bought stuff before they actually needed to just to avoid post tariff prices.
Peter Navarro on CNBC reacts to the shrinking GDP number by insisting it's actually good news because if you strip out the effect of tariffs "you have 3 percent growth. So we really like where we're at now."
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35 Comments
zdragnar
First I hear that the CPI, inflation, gas, food and medical costs are all down, and new employment exceed expectations by 100k.
Now I hear the GDP contacted? So many mixed signals.
os2warpman
The primer button on this contraction machine has only just been pressed, baby.
This is just us pulling an initial vacuum, drawing the real contraction in.
this_user
This was the expected result. The economy does not like uncertainty, and it is almost impossible to plan ahead until there is some clarity how and when the current trade war situation will resolve. The longer that takes, the worse the damage to the real economy will get.
jqpabc123
Not to worry, the emperor will fix it — by replacing the people who compile the numbers.
Any disagreement is a "hostile and political" act subjecting you to deportation without due process.
ty6853
Unfortunately housing will still not get cheaper because nearly the entire supply is locked into 30 year loans at near 0%, even a fool would starve, default their car note, and sell their every last valuable before giving that up.
gymbeaux
“Some of you may die, but that’s a sacrifice I’m willing to make” – Shrek (2001)
misja111
[flagged]
readthenotes1
The article is paywalled, so I cannot see if it mentions the controversy over the effect of all the gold that was brought into the US in 1Q.
https://www.fisherinvestments.com/en-us/insights/market-comm…
Edit: here's a breakdown. It looks like imports (gold and tariff front running) were big negatives.
https://www.zerohedge.com/economics/us-q1-gdp-contracts-reco…
methuselah_in
I guess this was expected when someone thinks that he can do everyone else as he wishes.
light_hue_1
The Constitution says Congress sets tariffs. The law Trump is using to do this doesn't even contain the word tariff.
Can we please stop this insanity? We had a great economy before this guy messed with it.
This is why we keep economic policy in an independent agency instead of giving it to politicians.
roter
http://archive.today/dalBp
amazingamazing
This is nothing. Wait until China figures out AI and India finishes taking the Software Engineering jobs.
pyb
…and the new policies haven't really taken effect yet.
pknerd
It was already a bubble. It is correcting now, knowing the facts that US gave away all jobs to China.
Mr_Eri_Atlov
Statistically, the best business decision anyone could make in this time of great uncertainty is to await regime collapse.
seydor
[flagged]
FollowingTheDao
And of course, right on cue…
Trump blames Biden ‘overhang’ after GDP shrinks in first quarter, says growth will ‘take a while’
https://www.cnbc.com/2025/04/30/trump-gdp-tariffs-biden-over…
Funny, I did not hear him talk about how the economy would tank and people would have to "sacrifice" or growth would "take a while" when he was running for president.
lvl155
And just as inflation was down to a level where the Fed would be comfortable enough to start cutting rates, this administration came into foil all of that. Even if you really believe in these policies, which is highly controversial, one has to wonder why they timed it so soon basically forcing the Fed into a corner. It's as if this administration has a mandate to destroy the US economy.
phkahler
I'm starting to think current measures of "the economy" are bogus. It can't grow indefinitely – that's probably just inflation. If you measure productivity in hours rather than dollars, inflation gets a more direct measure: how many hours do I need to work to buy food?
Making a better product than last year is also a strange way to claim growth.
What would be a better measure?
fabian2k
This is Trump's reaction to this on Truth Social:
> This is Biden’s Stock Market, not Trump’s. I didn’t take over until January 20th. Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers. Our Country will boom, but we have to get rid of the Biden “Overhang.” This will take a while, has NOTHING TO DO WITH TARIFFS, only that he left us with bad numbers, but when the boom begins, it will be like no other. BE PATIENT!!!
I'm curious how long he will get away with denying reality like this. The economical situation is likely to have much more immediate effects on people that almost every other topic. It should be much harder for him to do his usual thing once the economy really crashes, but who knows how his supporters will actually react.
sillyreason
This is just common sense. Resist the urge of confirmatory bias.
Imports surged in q1 to front-run tariffs. Imports are subtracted from GDP. Therefore GDP shrank.
C + I + G + NX = GDP
https://www.bea.gov/system/files/2020-04/GDP-Education-by-BE…
https://www.bea.gov/sites/default/files/2025-04/gdp1q25-adv….
yalogin
Why did snap not give second quarter projections? How will the economic uncertainty impact advertising? I thought that should be immune to an extent unlike Amazon or Walmart which are directly impacted.
lukashoff
Play stupid games, win stupid prizes.
isitsafeyet
I got my quarterly report from my RIA. I pay them 1% annually of my holdings which is about 50k. They basically said expect a lot more major portfolio strategy change if the tariffs aren’t lifted. Every paragraph said the current policy is dangerous, in a different way, without attacking trump directly. Been with them 15 years and they’ve never sounded this worried.
eagerpace
Fear of a minor pain is not a good reason to not make a change. That’s how growth works.
nabla9
Atlanta Fed has GDPNow forecasting model provides a "nowcast" of the official estimate.
It's currently -2.7 percent.
slantedview
[flagged]
jmull
It's going to get worse.
This is actually buoyed by buying ahead of the tariffs, and the tariffs themselves haven't had a chance to take effect yet.
The economic nosedive is just beginning.
acdha
This is just getting started, too, since the first half of Q1 was continuing to grow at the previous rates. Tge Atlanta Fed was projecting growth just under +2.5% until late February, and is now forecasting -2.7%:
https://www.atlantafed.org/cqer/research/gdpnow
Gimpei
I’m curious if any Trump voters are starting to feel any buyer’s remorse. The pain from the tariffs is only going to get worse. Soon we will have Trumpflation and a Trumpcession. Meanwhile, auto manufacturers are laying off employees. We are seeing pain with no gain. There is no reindustrialization nor will there ever be through this policy. For every economist except for Navarro, this is quite the own goal. I’m guessing you all were expecting Trump 1. Any doubts creeping in yet?
wnevets
are you great again?
dsign
Slightly meta, when looking from outside, reading here feels like having your friends in the much-bigger-than-the-Titanic ship comment on it while the ship that was the emblem of the world sinks. The worst part of it is that every person outside of US watching this have a little demon sitting on their shoulder repeating, "They voted for him. A second time! You can't pity them." But I will say it anyway: stay strong.
celsoazevedo
It will be interesting to see what happens in Q2. I assume a lot of people bought stuff before they actually needed to just to avoid post tariff prices.
praptak
Peter Navarro on CNBC reacts to the shrinking GDP number by insisting it's actually good news because if you strip out the effect of tariffs "you have 3 percent growth. So we really like where we're at now."
[0] https://www.cnbc.com/2025/04/30/trump-trade-navarro-us-gdp-d…
philipallstar
This 0.3% is the worst thing to happen to the US economy since Q1 2022, when it contracted by a much less reported-on 1.0%.