Latest Breaking News

Wiz Imp

(8,149 posts)

33. A major reason for the increase is actually a quirk in how the GDP is calculated.

Thu Sep 25, 2025, 07:06 PM

Sep 25

A significant drop in imports caused by the tariffs caused the GDP to rise (irrespective of any other factors). This is counter intuitive and quite frankly, leads to the GDP number being misleading.

The "import effect": Imports are a subtraction in the GDP calculation. During Q1, imports surged as businesses stockpiled goods in anticipation of new tariffs. When imports then fell sharply in Q2, it created a major boost to the GDP calculation, even though it didn't reflect booming domestic demand.

From Google AI Summary:

The headline 3.8% GDP figure for Q2 2025 paints an overly optimistic picture of the economy. The number was heavily distorted by the statistical effect of imports, even though consumer spending held up. Beneath the surface, signals like slowing job growth suggest the economy is on weaker footing than the single GDP number would imply, which is why policymakers and economists analyze a wider range of indicators.

Edit history

Please sign in to view edit histories.

Recommendations

4 members have recommended this reply (displayed in chronological order):

c-rational Bavorskoami rso scipan

68 replies

= new reply since forum marked as read

Highlight:

The US economy grew at a 3.8% rate in the second quarter, significantly stronger than previously reported [View all] BumRushDaShow Sep 25 OP

Sure it did. LudwigPastorius Sep 25 #1

First thing I thought: U.S. Commerce Department is putting out these numbers, Lutnick doesn't want to be fired. sop Sep 25 #2

If those numbers are accurate, maybe they represent spending before tariffs spooky3 Sep 25 #3

It includes Libation Day (sp) in April, with front running & all kinds of unusual adjustments by corps to TACO. Bernardo de La Paz Sep 25 #16

Sure, Jan. Scrivener7 Sep 25 #4

Awful that we have to wonder if official reports and stats are trustworthy. But there's good reason. And awful that wiggs Sep 25 #5

no need to decrease interest rates then, Mr Powell chicoescuela Sep 25 #6

So no more interest rate cuts? Raven123 Sep 25 #7

Has this been independently verified? greatauntoftriplets Sep 25 #8

The data for the next ten quarters is available and waiting to be released. twodogsbarking Sep 25 #9

Impossible Nigrum Cattus Sep 25 #10

Go to the web site or talk to an economist. . . . . nt Bernardo de La Paz Sep 25 #17

Wait a while johnnyfins Sep 25 #11

Yes, the economy is artificially boosted by AI capex (data centres, energy) Bernardo de La Paz Sep 25 #19

The real data will be Tax receipts IbogaProject Sep 25 #29

AI Capex, while strong, is not driving GDP growth lapfog_1 Sep 26 #53

They are moving to throw up data centres as fast as they can. There is construction, purchase of gas turbines, etc. Bernardo de La Paz Sep 26 #57

and there's swamp land in Yuma mdbl Sep 25 #12

Reporting anything less than 3x reality gets you fired ThoughtCriminal Sep 25 #13

You just shat on all the career professionals there. Bernardo de La Paz Sep 25 #18

Sure, blame our own ThreeNoSeep Sep 25 #24

How Dare You. Insulting people you don't know over facts you don't understand. Wiz Imp Sep 25 #31

Thank you. As if not getting fired automatically makes a worker corrupt. Bernardo de La Paz Sep 25 #34

That's all true OrwellwasRight Sep 26 #42

Everything he said would prevent a political appointee from juicing numbers. Bernardo de La Paz Sep 26 #43

Thank you! You are right about everything. Wiz Imp Sep 26 #46

The process makes it virtually impossible. Wiz Imp Sep 26 #47

Nobody cares. Igel Sep 26 #66

And when the reports are especially bad, like the last 2 payroll jobs reports, and the May retail sales progree Sep 26 #67

Agreed - although I myself learned long ago that going through the mental contortions required to willfully Midwestern Democrat Sep 27 #68

Reporting it accurately in Trump's maladministration and you are fired. travelingthrulife Sep 26 #49

Elevated spending because costs are increased by tariffs? nilram Sep 25 #14

LOL. "revised higher largely due to new additional data" PSPS Sep 25 #15

For some reason, I'm sure you had no problems believing the 1st quarter GDP Wiz Imp Sep 25 #32

In Fairness RobinA Sep 26 #65

Does anyone trust any numbers from a Trump admin? ananda Sep 25 #20

I no longer trust numbers from trump LetMyPeopleVote Sep 25 #21

Hmmm lonely bird Sep 25 #22

The reported GDP numbers are inflation-adjusted, that's why it's called "real GDP". The nominal dollar increase was a progree Sep 25 #36

Okaaaay lonely bird Sep 26 #45

Cool story, bro🙄nt Javaman Sep 25 #23

I hate to sound like a conspiracy theorist, Hayabusa Sep 25 #25

... UpInArms Sep 25 #26

Bullshit. AltairIV Sep 25 #27

As the members of Delta Tau Chi would say it. CentralMass Sep 25 #28

Um! ProfessorGAC Sep 25 #30

The reported GDP numbers are inflation-adjusted, that's why it's called "real GDP". The nominal dollar increase was 6.0% progree Sep 25 #37

Thanks, I Missed That ProfessorGAC Sep 26 #44

But does "inflation-adjusted," adjust for tariff increases? Doodley Sep 26 #55

This message was self-deleted by its author progree Sep 26 #61

New answer: Apparently not, if AI is to be believed progree Sep 26 #62

Thank you for the info. So, tariffs could, at least partly, be distorting the numbers. Doodley Sep 26 #64

A major reason for the increase is actually a quirk in how the GDP is calculated. Wiz Imp Sep 25 #33

They're messing with the numbers. n/t aggiesal Sep 25 #35

Yah right Lemon Lyman Sep 25 #38

I don't believe it at all. CaptainTruth Sep 25 #39

I was expecting 38%, 3800%, or 38,000,000%. So disappointing. hay rick Sep 25 #40

I don't Rebl2 Sep 25 #41

Just like voting, Spending boycotts only work if people participate. Hotler Sep 26 #48

Instead of trafficking in conspiracy theories about how everything is "fake" (it's not) Wiz Imp Sep 26 #50

Sure it did. Ocelot II Sep 26 #51

I trust no numbers coming from this gang. Ritabert Sep 26 #52

nice, cnn! way to spin "inflation was even higher than previously thought" as a positive thing. unblock Sep 26 #54

The "personal consumption expenditures price index" is reportedly the Fed's favorite inflation gauge progree Sep 26 #63

Do we believe this? No. WhiteTara Sep 26 #56

I'm surprised they didn't report 38 percent Bristlecone Sep 26 #58

Yeah sure kimbutgar Sep 26 #59

I don't believe it. Paper profits, at best, outright lying and statistics manipulation at worst. /nt artemisia1 Sep 26 #60