The U.S. economy posted surprisingly strong first-quarter growth this week, prompting economists to describe it as “resilient,” a word that experts confirm means “not dead yet but we’re watching it very carefully and have the defibrillator nearby.”
GDP expanded at an annualized rate of 2.1% despite soaring energy costs, supply chain disruptions, and what several Federal Reserve documents describe in the footnotes as “the ongoing geopolitical unpleasantness,” which is economist-speak for a war that has been on the front page every single day for three months.
“The fundamentals remain strong,” said Treasury Secretary Scott Bessent, briefly, before pivoting to discuss something else entirely. Consumer spending held up in Q1 largely because Americans, faced with $4.30-a-gallon gasoline and rising grocery prices, made the reasonable and distinctly human decision to keep spending money anyway because what else are you going to do, not live your life?
Analysts cautioned that resilience should not be confused with thriving, pointing to data showing that while GDP is growing, median household purchasing power has declined, credit card debt has hit an all-time record, and the average American’s financial strategy has evolved from “saving for retirement” to “not thinking about it.”
The stock market rose 0.4% on the GDP news before falling 1.2% when someone mentioned Iran, then rose again when a different analyst said “soft landing,” a phrase that financial markets respond to like golden retrievers hearing the word “walk.”
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