In today’s newly released IMF World Economic Outlook, 2025 Q4/Q4 growth revised down by 0.9 ppts from January. Compare against WSJ mean revised down by 1.27 ppts. GDPNow adjusted for gold imports is on track to match WSJ forecast.
Figure 1: GDP (black), IMF April WEO (dark blue square), January WEO (teal square), April WSJ (bold dark red), January (red), GDPNow of 4/17 adjusted for gold imports (green inverted triangle), all bn.Ch.2017$ SAAR. Source: BEA, IMF, WSJ surveys, Atlanta Fed, and author’s calculations.
Economist Intelligence Unit now projects 0.1% contraction in 2025.
At 1.5% Q4/Q4 real GDP growth in 2025, the IMF still seems to be in an optimistic camp.
Absoluty. But then, optimism is the responsible attitude, if pessimism won’t win a change in policy.
this is what “winning” looks like in the trump world.
and why is trump back tracking even more on the trade war with china? now the administration is saying that this cannot go on much longer, and the tariffs are amounting to a trade embargo that must be ended soon. I don’t think china will back down until AFTER trump takes a political beating and is weakened even more. only then will they agree to some sort of truce.
Back tracking? Simple answer. Look at the timeline from “Liberation Day.” What do you see? You see the anti-psychotics are finally beginning to kick-in. Full-effect will be close when he starts to slur his words again (as he was doing when his clown-show started spinning out of control in Donald 1.0). Dosage titration will start tapering when he begins to stop and stare blankly ahead for 4.92 to 37.56 seconds. In short, it’ll be Biden all over again. Except this time, the cause will be the anti-psychotics primarily, and to a lessor, yet rapidly growing extent, the sundry difficult to diagnose organic brain decay syndromes, old men are plagued by, will all be relentlessly riddling Donald 2.0’s cognitive capabilities.
Only slightly off topic – Günther Thallinger, a member of the management board at Allianz, is concerned that climate change is a risk to capitalism:
https://www.linkedin.com/pulse/climate-risk-insurance-future-capitalism-g%C3%BCnther-thallinger-smw5f
This is certainly not a new idea. Headlines now regularly indicate the problem that increasing disaster claims represent for home ownership. The press has not, however, adequately made the connection between insurance* and commerce writ large: Business runs on credit; credit requires insurance. Lose insurance and that’s the ballgame for capitalism. Thallinger notes “…we are fast approaching (increases in average) temperature levels—1.5°C, 2°C, 3°C—where insurers will no longer be able to offer coverage for many of these risks. The math breaks down: the premiums required exceed what people or companies can pay.”
So while we are transfixed by the destruction of trade and the global systems that underpin trade, give a thought to the economic loss that would result from withdrawal of insurance coverage. Bigger. Much bigger.
While our felon-in-chief flatters himself by playing gangster in global trade, he is ignoring massive problems that only government action can address, and only in cooperation with other governments. Government solutions, in cooperation with other governments – not the felon’s brand.
In fact, distracting voters from real problems by hyping made-up ones is the modern Republican brand. At least since Reagan, the GOP has distracted voters with race, religion, guns, masculinity, crime, “terror”, identity, and now trade, while the serious work of enriching the rich, empowering the powerful, and disenfranchising everone else proceeds in relative darkness.
*There is some evidence that the earliest extension of trade credit was, in fact, a form of insurance. The ancient lender stood the risk of lost cargoes, rather than the trader. The vig was so high, and diversification of risk sufficient, that lenders could shoulder the entire risk of loss – in other words, insurance.
Here’s a very early example of lending playing outas insurance:
The Code of Hammurabi
Law 100
(Basic lending law)
“If a merchant has sent an agent on a journey to give or to receive silver, but on the journey the agent… if where he went he should have made a profit, he shall work out the interest for the amount of silver he took and count the number of days, and shall recompense the merchant.”
Law 103
(Force majeure)
“If while traveling his route an enemy made him give up what he had, the agent will swear by the life of the god and be released (from repayment).”
https://ehammurabi.org/law/101
https://ehammurabi.org/law/103
So why would Trump and the Republican’s pick this time, of all times, to attack and savage NOAA? Besides the obvious, Trump’s repeated “I love the uneducated” quotes in general? Try this on for size,
https://weather.com/storms/tornado/news/2024-06-04-tornado-alley-shifted-study-coleman-et-al-2024
Notice the terrifying ‘fingers of God’ are shifting from sparsely populated states and plunging deep into dense Red voting districts. The Republicans have ‘invested’ billions lying to and increasing the ranks of the “uneducated” in the tornado bullseye zone. Perhaps, in order to protect their ‘investment’, NOAA and pretty much all forms of STEM must be squelched ASAP to protect Republican power derived from their painstakingly cultivated uneducated base, or they risk losing the Central South.
So, China called, I guess?
Bessent wouldn’t have given the WRONG insider information to a bunch of high-net-worth plutocrats, would he? So the felon said China had to call before we could make a deal, so China called?
Growth for Japan and Europe’s major economies is forecast to be virtually imperceptible, dropping from slightly perceptible before Trump’s tariffs.
https://www.bbc.com/news/articles/czx415erwkwo
Of course, anemic growth over the last 3 years is largely attributable to sanctions on Russia and rising energy costs, something that should not be overlooked.