’Depression’ Narrative Bust: Atlanta Fed 'Adjusts’ Away GDP Plunge Forecast
Who could have seen that coming?
Well us, literally!!
One month ago the world was stunned when the Atlanta Fed GDPNow forecast slashed US GDP Q1 estimates to down almost 4%.
This sparked every leftist, establishment talking-head to leap to their feet and decry Trump’s policies as heralding the next Great Depression.
There was just a little problem…
As we detailed immediately after The Atlanta Fed’s report hit, it’s not the economy, it’s gold stupid!!!
… we subsequently learned that the plunge in GDP was the direct result of a spike in imports, which subtract from GDP.
As it turns out, and as Goldman economist Manuel Abecasis explained this morning, most of the widening in the trade deficit since November was driven by higher gold imports.
That’s right: the same spike in gold that indicates something is (perhaps terminally) broken with the financial system as we have now seen a record scramble for physical gold, also just happens to be slamming the US economy!
And sure enough, having 'adjusted’ for the massive surge in gold imports, The Atlanta Fed quietly revised their forecast for Q1 GDP to just a 0.1% decline…
So, no economic collapse. No financial hellscape. No 'next great depression’?
And just like that, the hue and cry from the academics, politicians, and talking-heads is gone… like Keyser Soze.
This is alot more insidious than it seems, because every single liberal pundit ran with these numbers to push a narrative. If you wanted to artificially crash an economy, this is how you would try to do it.
— P.T. Ward (@HTWardish) April 16, 2025
Was the data ever that bad? Or did The Atlanta Fed just take its cues from the University of Michigan and its survey respondents?
Or were The Usual Suspects attempting to manipulate a narrative once again?
Tyler Durden
Wed, 04/16/2025 – 14:25
