curated news excerpts & citations

The U.S. economy entered 2025 as the “envy of the world.” It exited well behind its peers.
MANY OF US HAVE BEEN raising hue and cry about the irreversible damage Donald Trump has wreaked on the economy. Tariffs! Corporate shakedowns! Destruction of research institutions! Deletion of data! Politicization of the Federal Reserve! Alienation of our allies! Socialization of private companies!
And of course, the collapse of the rule of law.
All of these things should be terrible for the U.S. economy, especially in the long term. And yet to date, the stock market has seemingly shrugged it all off.
In fact, markets look somewhat ebullient. In 2025, the S&P 500 grew a solid 16 percent—far better than the average year, and better than many forecasts, particularly in the wake of Trump’s Liberation Day tariffs.
So what’s going on? Why aren’t investors pricing in all these risks?
Some of it may be that they believe there’s a huge, sustainable Trump boom just around the corner. It didn’t come by the end of 2025, but perhaps it’ll arrive this quarter . . . or next quarter . . . or the end of 2026, per the latest goalpost-moving forecasts from Commerce Secretary Howard Lutnick.
But there are other ways to interpret what’s going on. None of them are particularly assuring:
- U.S. markets actually aren’t doing that great, when compared to our global competitors.
- The lion’s share of growth here in the United States—in both financial markets and hard economic data—is driven by a single sector: A.I . . .
- . . . which looks an awful lot like a bubble right now.
I find these explanations to be more persuasive than the hope that a new economic golden age is about to dawn. And to understand why, it’s worth recapping why you should worry about the long-term damage from Trump’s policies in the first place.
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