Inflation Has Surged, Our Economy Has Slowed, And Everything Trump Is Doing Is Making It Worse

Janet Mills has dropped out of the Maine Senate race

Morning all. There will be two posts from me today. This first one looks at the new economic data we got this morning. The second one will contain my talk from last night, and some additional commentary on the Supreme Court’s gutting of the Voting Rights Act. For an initial take on Callais, and on what has been a very ugly period for the DOJ, watch my new discussion with lawyer, commentator and pro-democracy warrior, Katie Phang.

Also some breaking news - Governor Janet Mills has dropped out of the Maine Senate race. I am heading to Maine later today to speak at the State Democratic Party Convention so I will have more on this important development in the coming days…..

Now, the economic news. The bottom line - q1 GDP growth came in lower and the PCE inflation measure higher than expected. First quarter GDP growth was 2%, lower than the consensus 2.2%. PCE for the month came in at 0.7, higher than the Cleveland Fed Nowcast of 0.58. “Core” PCE also came in higher than the Fed Nowcast. What this means in simple English is that the economy was slower in the first quarter and inflation higher in March than was expected. Great work Donald.

Let’s go to our Hopium economic charts to remind us where we are now under Trump….

Here’s our an updated version of PCE (personal consumption expenditures). Of the 3 main inflation gauges PCE is the one favored by the Fed. Note that throughout our inflation charts you will see that Trump’s tariffs had caused inflation to rise and push it above the Fed target rate of 2% prior to the war.

Here’s “core” PCE, without energy or food, year over year:

Here’s the OECD forecast for US GDP growth this year and next, with this q1 number coming in line with the forecast. Trump’s policies have significantly slowed the US economy from the one he inherited.

Oil prices continue to bounce around all time highs for the war as it becomes clear to all that Trump has no way of ending the war and opening the Strait. Gas prices in the US have surged to their highest of the war:

Here’s our latest CPI chart. This is the every day inflation gauge. It exploded in March:

Here’s our chart of the third main gauge of inflation, PPI. Everything is way, way above the Fed’s 2% inflation target:

The job growth data shows how much damage Trump’s tariffs have done to the great American job engine:

Over his two Presidencies Trump has had the slowest job growth of any President since Hoover:

And the slowest economic growth too:

Slower growth, higher inflation/interest rates, and his unaffordable tax cuts have all left America in a far weaker fiscal position today:

These surging prices and slower growth has lead to the lowest consumer sentiment reading in the respected University of Michigan survey in 65 years:

Here’s a top story in Politico right now, A top GOP super PAC warns ‘The Republican Senate majority is at risk’:

Top Republicans are growing increasingly anxious that the Senate, once seen as a lock for the party to hold in the midterms, is at risk of flipping as Democrats continue to hammer President Donald Trump for the cost of living and foreign intervention in Iran.

That fear is laid out in a new memo, shared exclusively with POLITICO, from the powerful GOP and Koch-aligned super PAC Americans for Prosperity Action, whose leaders are calling on the GOP to lock in on the cost of living or risk losing power in Washington.

“As it stands today, our view is that the Republican Senate majority is at risk,” AFP senior adviser Emily Seidel and Executive Director Nathan Nascimento write. “Our internal polling in several battleground states and one-on-one conversations with voters show that for the first time, Democrats are more trusted on the economy and inflation.”

Their warning comes with a clear plea for the GOP: Figure out how to message on cost living, and fast.

“The window to act is now,” they said.

In their view, there’s a clear path forward, but it requires a coherent message and “relentless focus on driving costs down and keeping them low.”

“Every policy fight, every floor speech, every campaign event should answer one question—what are you doing to lower the cost of living for working families?” they write.

The memo comes as polling shows Trump’s approval rating continue to slip on economic issues: A Reuters/Ipsos survey released this week found just 22 percent of Americans approved of his handling of cost-of-living issues.

As I look at all this what I keep thinking is that as Trump was preparing to go to war he and his team had access to all this economic data showing inflation rising, job and economic growth slowing, and they went ahead with the war anyway. And here we are - inflation surging, the economy slowing, a war that has failed, his poll numbers tanking, consumer confidence plummeting, GOP mid-term prospects growing far dimmer - and rather than fixing it all he is fighting for his ridiculous bunker and attacking his enemies.

I don’t think we’ve yet to really process the scale of his failure, of how much damage he’s done to the country and the world; so yet, as bad as it is for Republicans today, it could get far, far worse for Donald Trump is clearly the greatest fuck up in all of American history.

Keep working hard all. We have a country to save, and elections to win, together! - Simon