GDP First Release - Stagflation
 

This release does not include the effects of actual tariffs, but more reflects the chaos and confusion /uncertainty around the size, purpose and impact of impending tariffs.

Inflation deflator higher than expected, so next step is recession, barring no changes in policies. Most trade policies take quarters to come to an executable agreement.

So backward accounting looks are a deteriorating economy, and the Fed will not try to save the economy right away, and treasury bonds may become more risky to hold, so interest rates may rise more than expected.

Holding Treasuries, the question for why the bonds will move:
1 - inflation higher? = bonds down/rates up
2 - recession? = bonds up/rates down
3 - US Dollar down? = bonds down / rates up

good luck to us!

Why would the Fed lower rates when inflation is worse than ever? We going to give money away for free, (crazy low interest rates), and expect inflation to improve?

AI Overview:

A GDP deflator higher than expected means that the prices of goods and services included in Gross Domestic Product are rising faster than anticipated. This indicates a higher rate of inflation than what was projected, potentially impacting economic growth and stability.

How will this NOT devolve to politics. Bait post.

If you have been following the financial/investment threads, you may be aware these updates are often posted without conflict.

Where did you read that inflation is worse than ever? The last report I saw said it was a little below expectations at 2.4%. Sure, 2.0% would be nice and it might go up in the next report but by no means is 2.4% "worse than ever."

Good to hear prices you're paying stabilized and nothing has gone up in the past few years and continuing. We see constant increases in pricing, constant.. taxes, repairs, food, medical, insurance, utilities, phone bills, internet services, the list is endless. But good on you.

This is a discussion on economics. Does not need to become political.

C&S................you have out done yourself on click-bait, should get the anxious fired up.

:22yikes:

So you don’t understand what inflation means.

Yes, things have increased, two years ago almost 4%, last year about 2.5%, and this year it’s too soon to tell. Prices have gone up and that is called inflation.

Yes, prices have gone up constantly and that is normal. The last two years that prices did not increase were 2015 and 2009. Both those years followed significant economic problems in the US. We don’t want another recession with negative inflation.

People have different ideas of what “high” inflation is. Above 5% is certainly high, some would say above 3%, and still others would say anything above 0% is too much. A common target for a healthy US economy is 2%. Last year’s 2.5% was pretty good and last month’s 2.4% was a little better.

Inflation so far this year is not greater than ever, not even close. Prices increased last year but so did the SS COLA and so did the stock market. Some items increased far more than inflation and those need to be looked at but they are the exception, not the rule.

I am very hopeful give this some time.

:highfive:

A lot of Shock & Awe and emotion.

We are in strange territory and the "pro's" are trying to predict and fill airtime on shows.

Market Timing???

Have fundamentals changed???

:posting:

The GDP calculation includes the trade deficit which was even larger than normal.

I noticed that the S&P closed higher today after this news.

Please, I don't understand what inflation means? Oh boy, I'm about to hear a fairy tale about inflation. Painting pretty pictures about how we should all be thriving in the price increases we have endured recently is ridiculous.

The SS COLA increase addressed little of actual increases in the cost of living for seniors and the stock market is a rocky, old boat with a small cork plugging the hole in it's problems. I sure wish I had some of that elixir to get the same skewed perspective.

Bureau of Labor Statistics:
Since 2020, US inflation has seen a significant increase, peaking in 2022 and then declining in 2023. The inflation rate in 2020 was 1.23%, increasing to 4.70% in 2021 and 8.00% in 2022. In 2023, it decreased to 4.12%. As of March 2025, the Consumer Price Index (CPI) for all items rose by 2.4% over the last 12 months,

This is not the first nor the last downturn in the market.

Nobody can consistently time the market. If they say they can and want to handle your funds all I can say is run forrest run.

Once went to a financial seminar and the guy running it was looking to manage others funds was a former math teacher which he only admitted when I asked him for his background.

Asked him how he times the market and he told me of this wonderful computer program he owns that does it for him and his clients.

When I looked at him like he had two heads he would not look at me for the rest of his presentation. Will say the food was good.

Great, you found the same data I did though I prefer the table view found on other pages.

What I don’t see there is your point. Yes, inflation was high in 2022. Today is not 2022 and today inflation is not high. Comparisons to 2020 are as valid as comparisons to 2009 and 2015 - there is a reason why inflation was low and it is not something we should desire to repeat.