Many including myself were really surprised when the 4th Quarter real GDP came in at 2.6% when it was released (January 26). We were even more surprised when it was revised on February 28th to 2.5%. We all asked how could that be given what we were seeing and reading about the Christmas shopping which was up 6% from the previous year.
We all fell for a fallacy! Yes Americans were buying more than they had in a very long time. Consumer confidence is at all time highs. However, since so little of what was purchased was made in the USA, our imports had to be increased because of the demand. That increase in imports is a complete subtraction from our real GDP.
This tweet that was released earlier by Sarah makes the point I shared above! Canada in 2017 had a $17.58 Billion dollar surplus with us. Check out what the dollar amount was for January 2018. That is $3.63 Billion dollars. The Canadians are as happy as happy can be because Americans are confident in the Economy and have extra money in their pockets (January’s budget surplus for them shows it). They and others are the ones that are benefiting. Not us!
The Mexicans love our confidence in the Economy and the fact we are willing to spend more! This tweet tells you how much they are benefiting.
This tweet by Charles Payne tells you the story about how the World is happy as hell because Americans are spending more.
We have to wake up or we will lose it all! What I showed is the master plan of the last 4 administrations. Spend more so that the world’s real GDP expands (3.5% last year) while ours evaporates because we are the ones that caused the world to enjoy a real GDP of 3.5% in 2017!