Transcript
David Pakman (0:07)
Welcome to the show, everybody. Hope you had a good weekend. We are now officially more than one month into the second presidency of Donald Trump and I'm going to do what I told you I would do. We will track and compare economic metrics. We will not play politics. I will simply tell you, here's what the data says about the state of the economy under Donald Trump. One of the things we did on the day after Joe Biden left the White House and Donald Trump again became president was I told you, here is the unemployment rate that Joe Biden is handing to Donald Trump. Here's the inflation rate that Joe Biden is handing to Trump. Here's the stock market level that Biden is handing to Trump. And we will track in black and white where this goes as the Trump presidency progresses. Now, I don't know that I'm necessarily going to be doing this around the 20th of every month, but I'm doing it this month just to show that you can do this and you will see that the data is there for the having in black and white. So real quick, the unemployment rate at the end of Joe Biden's presidency was 4.1%. Trump's first month saw the unemployment rate tick down from 4.1 to 4%. Great. No significant change. No significant spike, certainly, and a small reduction in the unemployment rate. The year over year inflation rate at the end of President Biden's presidency was 2.9% year over year. After Trump's first month in office, we saw the inflation rate go up just a little bit from 2.9 to 3%. Not a significant change. Certainly one metric improved. One metric arguably worsened. Depending on what you believe is the ideal amount of of inflation, generally believed to be 2 to 3%. We still don't have we on GDP. GDP is longer term. We would look at GDP quarter to quarter and year over year. We don't even have the Q4, 2024 GDP number yet. So we're going to have to wait on GDP. Interest rates. We tend to look at the 30 year fixed. That's kind of like the baseline metric we often look at. At the end of Joe Biden's presidency, the 30 year fixed rate was at 7.04%. It is ticked down a little bit to 6.85%. Much of that, of course, tracks Fed activity. But not all. Consumer sentiment is the one place where there is an area of concern. Consumer sentiment, based on the University of Michigan study, which is one of the big ones that economists look at, tracking consumer sentiment, meaning the feeling about the direction of the economy, how frugal or lax people would be when it comes to spending. Consumer sentiment has worsened 10, 10% since Donald Trump became president. So what we could. I think it's accurate to say that although no major economic indicator has yet worsened significantly, the opinion of the average American is that things are going to go in a negative direction. Now, that may be true, it may not be true. And then finally, stock market performance flat with the kind of very poor two trading days at the end of last week, we are basically at the exact same place in terms of the stock market over the last month. Now, there are people who will say the expectation is that over time the stock market appreciates and therefore flat is bad. I will leave that. I'm trying to be as apolitical as possible here. The stock market flat during the first month of Donald Trump's presidency. So that's where we are. We will continue tracking it, and I think the next month of data will start to point to a trend. We will either see things start to worsen or improve, or we will see everything seems flat. It seems as though the transition from Biden to Trump has changed nothing about the overarching state of the economy. That's where we are right now. Of course, we know eggs, right? Eggs are going nuclear. I don't have an egg report for you today. Other than yesterday. I found zero eggs at my local 2 grocery stores. I had to go to an inferior grocery store further away, and the only choice I had was a six pack of one type of egg. And there were signs saying two packages max per customer. So that was the state. That's my egg report from yesterday. But at some point during the week, we will look at egg prices. Egg prices certainly up, but we look at broader metrics like inflation, inflation going from 2.9 to 3. That's where we are. The new line from MAGA is that they will not even acknowledge that Russia started the war, that Russia is the aggressor that Russia invaded. This is all happening in a context where MAGA is increasingly deferential to Vladimir Putin. This is happening in a world where it seems as though the Trump administration is going to give Vladimir Putin everything he wants. New territory that he took by force, keeping Ukraine out of Naito, on and on and on. And this is also happening in a world where we do not have a shared basis in fact from which we can have conversations about what's going on. Now, I will tell you in a moment why they are so dead set against simply acknowledging. Yeah, Vladimir Putin invaded. Russia's the aggressor. I'll explain it in a moment. Here is Secretary of Defense Gag Pete Hegseth asked, can we just say Russia attacked? And he says, no, no, no, it's more complicated. Should come to the table because this economic partnership is an important thing for the future of his country, and we hope that he will very soon. But fair to say, Russia attacked unprovoked into Ukraine three years ago tomorrow.