“Americans are tapping the brakes on spending – pulling back on dining out, hotel stays and other expenses, as they boost their savings ahead of new tariffs and continued economic uncertainty.”
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“Strikingly, economists say Americans of all income levels, including the wealthiest, are rethinking their spending – in what could be a pivotal warning. The drop-off in consumer spending is expected to drag down economic growth in the first three months of the year, with many economists now forecasting a contraction after years of consistent growth.”
“The “Buy Canadian” movement is sending new ripples of concern through the executive offices of U.S.-based consumer companies that banked on selling their products on Canadian retail shelves.”
“The number of credit card holders making only minimum payments on their bills has jumped to a 12-year high, a study by the Philadelphia Federal Reserve found.
The level of cardholders only making minimum payments rose to 10.75% in the third quarter of 2024, the study found, continuing an upward trend from 2021.
The number of 30+ day delinquencies also rose during this period, up to 3.52%. That’s double the delinquency rate of 1.57% from the pandemic low in the second quarter of 2021.”
“Remember two years ago, when GDP was reported as having shrunk for two consecutive quarters, and there was an entire exhausting discourse about whether it qualified as a recession? Turns out it was a statistical illusion.”
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“The Commerce Department published on Thursday morning revised GDP data for the past several years based on more complete information. One of the adjustments: GDP is now estimated to have grown in the second quarter of 2022 at a 0.3% annual rate.”
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“The revisions also point to more robust GDP growth throughout the post-pandemic expansion, with 2021 GDP growth revised up by 0.3 percentage points, 2022 up 0.6 points, and 2023 up 0.4 points.”
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“GDP growth numbers for the second half of 2023 were revised down, pointing to some deceleration of activity heading into 2024.”
“Inflation climbed in February as consumers braced for the potential onslaught of higher prices from President Donald Trump’s sweeping tariffs on U.S. trading partners.
The Commerce Department reported Friday that prices rose at a higher-than-expected annual rate of 2.8 percent last month, excluding food and energy items, a signal that prices could spike even further in the coming months.”
China is not really capitalist because some of their most important industries are owned by the government and the government doesn’t care about the stock market. The main goal of those state owned enterprises is not profit, and, unlike in the U.S., the Chinese government is not concerned with keeping their stock market growing.
“The Trump administration has dismissed advisers to key statistical agencies behind major economic reports, sparking warnings that the cuts will jeopardize the quality of data critical to policymakers and Wall Street investors.
Economists, academics and corporate officials serving on a board of unpaid advisers to the Labor Department’s statistical bureau were told this week they were no longer needed, two of the former members told POLITICO. Similar committees that advised the Commerce Department’s Bureau of Economic Analysis and the Census Bureau have also been let go. And the Federal Housing Finance Authority placed workers who assisted with its widely cited home price index on administrative leave Wednesday.”
“The markets understand the basic truth about tariffs, which are taxes consumers in our country pay for imported goods. They raise prices, reduce our access to foreign goods and spark reciprocal tariffs that then punish our country’s farmers and manufacturers. They lead to less growth and more unemployment. They increase bureaucracy by requiring officials to calculate duties and enforce them. They create hostilities and have led to actual war.
As economist Robert Higgs explains, “Fiscally, protectionism is a poor source of government revenue that dries up completely as tariffs are increased so much that they reduce trade flows to zero. Morally, protectionism is vicious because it coercively substitutes the ill-informed and ill-directed judgment of government officials for the judgment of people making deals with their own private property.””
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“Trump threatened them to gain ill-defined concessions from our friendly, highly developed and peaceful allies to the north. Then, after it was clear Canada had already conceded to whatever it was our president demanded, he suspended them. His supporters claimed tariff critics didn’t understand that this was just a brilliant negotiating tool. But then this month the president imposed them anyway. True to form, MAGA shifted back to arguing that tariffs are great policy in and of themselves.”