{"id":98685,"date":"2025-10-02T08:39:10","date_gmt":"2025-10-02T08:39:10","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/98685\/"},"modified":"2025-10-02T08:39:10","modified_gmt":"2025-10-02T08:39:10","slug":"the-economy-is-just-getting-stronger-not-weaker-and-we-in-the-economics-profession-need-to-look-ourselves-in-the-mirror-top-analyst-says","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/98685\/","title":{"rendered":"The economy is just getting stronger, not weaker, and \u2018we in the economics profession need to look ourselves in the mirror,\u2019 top analyst says"},"content":{"rendered":"

One of Wall Street\u2019s most closely watched voices delivered a blunt message to peers and policymakers: The U.S. economy is not faltering\u2014it is accelerating. Torsten Sl\u00f8k, chief economist at Apollo Global Management<\/a>, said forecasts of an imminent slowdown have been repeatedly wrong, and the economics profession should start grappling with its track record of misjudgments.<\/p>\n

\u201cThe consensus has been wrong since January,\u201d Sl\u00f8k said in a note circulated to clients Wednesday morning, adding that the average of economists\u2019 forecasts has said the U.S. economy would slow down for nine months running. \u201cBut the reality is that it has simply not happened \u2026 We in the economics profession need to look ourselves in the mirror.\u201d<\/p>\n

Growth defies expectations<\/p>\n

Second-quarter GDP expanded at a 3.8% annualized rate<\/a>, a strikingly strong pace given the Federal Reserve\u2019s ongoing effort to tamp down inflation. The Atlanta Fed\u2019s GDPNow model suggests growth may be even stronger in the third quarter, forecasting 3.9% gains. Many economists had expected the lagging impact of high interest rates, tighter credit conditions, and April\u2019s \u201cLiberation Day\u201d market shock to drag growth meaningfully lower by now.<\/p>\n

Instead, the data tells a different story. Consumer spending has continued to prove resilient<\/a>, and business investment, far from retreating, has strengthened in sectors tied to artificial intelligence, energy infrastructure, and manufacturing reshoring. Housing, often sensitive to interest rates, has shown surprising stability in key regional markets. Sl\u00f8k did not dive into these particulars in Wednesday\u2019s edition of his Daily Spark, except to address slowing job growth. \u201cThis is the result of slowing immigration,\u201d he wrote, not economic weakness.<\/p>\n

\u201cThe bottom line is that the U.S. economy remains remarkably resilient,\u201d Sl\u00f8k emphasized. \u201cIt is becoming increasingly difficult to argue that we are still waiting for the delayed negative effects of what happened six months ago,\u201d referring to President Trump\u2019s Liberation Day and the imposition of sweeping reciprocal tariffs. One top analyst has been arguing for years that most of Wall Street was wrong, and that Liberation Day represented the end of the beginning, rather than the beginning of the end.<\/p>\n

Rolling recovery underway?<\/p>\n

Morgan Stanley\u2019s chief U.S. equity strategist, Mike Wilson, has coined a phrase to describe what\u2019s been happening in the economy for roughly three years: a \u201crolling recession<\/a>.\u201d The economy has been quietly weathering recession-like conditions since sometime in 2022, Wilson has argued throughout, with a recession not being picked up by conventional measurements but rather rolling through different segments of the economy, one at a time. Wilson contends headline figures such as GDP and unemployment missed serious underlying struggles, including an 80% collapse in hiring over the summer and persistently negative median-earnings growth.<\/p>\n

Although neither he nor Sl\u00f8k has noted how their readings of the economy intersect, Wilson believes the economy bottomed out last spring\u2014coinciding with the White House\u2019s Liberation Day crackdown on tariffs. Federal employment was the one area not affected by the rolling recession, he noted, until Elon Musk\u2019s DOGE initiative remedied that rather dramatically<\/a>.<\/p>\n

In early September, Wilson argued the weak jobs report for August that had just been issued provided \u201cfurther evidence of our thesis that we are now transitioning from a rolling recession to a rolling recovery.\u201d<\/p>\n

\u201cIn short, we\u2019re entering an early-cycle environment, and the Fed cutting rates will be key to the next leg of the new bull market that began in April,\u201d Wilson wrote.<\/p>\n

The jobs report for September is not out yet at this time of publication, but on Wednesday, the private payrolls report from ADP<\/a> showed a loss of jobs for September and a revision into negative territory for August. Bill Adams, chief economist for Comerica<\/a> Bank, noted in a statement to Fortune that this result was worse than expected, with ADP now reporting declines in three of the past four months. Commentating on Wednesday\u2019s other news, that the government has shut down again<\/a>, for the third time under President Trump, Adams noted: \u201cThe\u00a0ADP\u00a0report usually plays second fiddle to the government\u2019s jobs report, but is more important while the shutdown is delaying government data.\u201d The rolling recovery, in other words, is showing up in a buoyant stock market, but not in the labor market. Federal Reserve Chair Jerome Powell noted in September that it\u2019s a \u201clow-hire, low-fire<\/a>\u201d environment.<\/p>\n

What it means for investors<\/p>\n

For markets, Sl\u00f8k\u2019s diagnosis carries important implications. If the economy is not weakening, but strengthening, the outlook for inflation could tilt higher. Core inflation has eased from its 2022 highs, yet Sl\u00f8k warns strong growth combined with an easier monetary policy stance could rekindle price pressures.<\/p>\n

\u201cThe upside risks to inflation are growing, particularly if the Fed continues to cut rates,\u201d Sl\u00f8k wrote Wednesday. <\/p>\n

In September, the central bank followed through on its first rate reduction in years, signaling confidence that inflation was heading back toward target. Markets have since priced in additional cuts in the coming quarters. In fact, on Sept. 30, Sl\u00f8k had argued \u201cthe economy is strong, and inflation is high,\u201d citing 12 different data points (including tourism levels and a high number of visits to the Statue of Liberty). Then he issued a potentially bold call in light of the next day\u2019s ADP data, arguing the consensus from the next jobs report of 50,000 payrolls was \u201ctoo pessimistic.\u201d<\/p>\n

Sl\u00f8k\u2019s sharpest remarks, however, were directed not at policymakers or markets, but at the forecasting community itself. By repeatedly predicting weakness that never arrived, he argued, economists have undermined their credibility.\n<\/p>\n

Fortune Global Forum<\/strong> returns Oct. 26\u201327, 2025 in Riyadh. CEOs and global leaders will gather for a dynamic, invitation-only event shaping the future of business. Apply for an invitation.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"One of Wall Street\u2019s most closely watched voices delivered a blunt message to peers and policymakers: The U.S.…\n","protected":false},"author":2,"featured_media":98686,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[174],"tags":[79,179,18,19,185,17,227],"class_list":{"0":"post-98685","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-eire","11":"tag-ie","12":"tag-inflation","13":"tag-ireland","14":"tag-jobs"},"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/98685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=98685"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/98685\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/98686"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=98685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=98685"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=98685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}