The latest government inflation and GDP figures are worthless, and will be for months to come

[Guno צְבִי]

The federal government's monthly releases of economic statistics — especially the inflation rate and growth as tracked by gross domestic product — have long occasioned partisan preening (or denunciation) and for a general public stock-taking of the health of the economy.

Not this month. This time, they're the occasion for doubt and confusion.

On Dec. 18, the Bureau of Labor Statistics reported that inflation had fallen to an annual rate of 2.7% in November, down from 3% in September and well below the 3.1% consensus of economists. And on Tuesday, the Bureau of Economic Analysis reported that real gross domestic product had shot up by a surprising 4.3% annual rate in the third quarter of 2025 ended Sept. 30.

A close examination of the GDP figures also underscores the narrow basis driving economic growth in recent months — it's essentially the product of robust spending by wealthy consumers and massive corporate investments in AI technology. For middle- and lower-income Americans, the economic present and future don't look anywhere as sunny as the numbers would suggest.

"The numbers give you meaningful information about the system, but not about how people experience their actual lives," says financial analyst and economic commentator Zachary Karabell, whose 2014 book "The Leading Indicators" injected some perspective on how we interpret economic statistics and explained why our faith in them is often misplaced.

Indeed, consumer confidence has been sinking for months, according to the Conference Board. That points to an enduring question about the U.S. economy: Whose economy is it?

Hiltzik: The latest government inflation and GDP figures are worthless, and will be for months to come

Gaps in data because of the government shutdown make a hash of the latest federal reports on inflation and economic growth.

news.yahoo.com

 

[Guno צְבִי]

More than ever, it belongs to the rich, producing a "K-shaped" economy, which has been playing out in shopping patterns this holiday season, as my colleague Caroline Petrow-Cohen recently wrote.

According to Bank of America analysts, since this spring, spending by the highest-earning third of Americans has been soaring, while that of middle- and lower-income households has stagnated. In part that's because the stock market has remained vibrant.

Since the top 20% of households as measured by income own about 87% of directly-held equities, stock market gains "tend to disproportionately benefit the higher-income cohort," the BofA analysts noted. By contrast, "almost 30% of lower-income households appear to be living 'paycheck to paycheck.'”

The highest-earning 10% of households now account for nearly half of all consumer spending, according to Moody's Analytics. That's the highest level since the data began to be collected in the 1980s, when the rich accounted for only about one-third of spending.

Job growth may already have turned negative, even if the published employment figures don't yet show it, Federal Reserve Chairman Jerome Powell acknowledged during a Dec. 10 news conference following the Fed's decision to lower interest rates by 0.25 percentage points.

 

[Guno צְבִי]

The divergence between the gross economic statistics and the lived experience of Americans is nothing new. It was remarked on by Robert F. Kennedy Sr. in a speech in March 1968, less than three months before his nascent presidential campaign was ended by an assassin's bullet.

"Gross national product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage," he observed. "It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. ... Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. ... It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile."

 

[Jake Starkey]

There are plenty of private number of economic shops to draw from.

Yes, Trump stats can be ignored.

 

[Cypress]

According to Bank of America analysts, since this spring, spending by the highest-earning third of Americans has been soaring, while that of middle- and lower-income households has stagnated. In part that's because the stock market has remained vibrant.

Trump's tax cuts, as per usual, overwhelming benefited the affluent investor class, so they are flush with extra cash.