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A recession is imminent…

The Atlanta Fed's GDPNOW model  – forecasting US economic growth – just downgraded its estimate of Q1 2025 GDP growth (or lack of it) from +2.3% to -1.5%…

After recent releases from the US Bureau of Economic Analysis and the US Census Bureau, the nowcast of the contribution of net exports to first-quarter real GDP growth fell from -0.41 percentage points to -3.70 percentage points while the nowcast of first-quarter real personal consumption expenditures growth fell from 2.3 percent to 1.3 percent.

Put a different way, spending less on transsexual Guinea pigs in Bora Bora means US GDP gets hit.

It does make us wonder how a 'model' of economic growth can swing 380bps into contraction from trend growth in a week… but hey, propagandists gonna propaganda.

Who could have seen this coming?

Well we did!

And here is Mizuho's Dominic Konstam just yesterday confirming the narrative perfectly…

February was an absolute shitshow for macro data with inflation surprising to the upside and growth drastically surprising to the downside. Put together, they form the Fed's nemesis – Stagflation!

All of which could be seen as good news for Trump: he can impose tariffs (inflation) AND the Fed will be forced to cut rates (growth).