Keep pulling the thread on Tracy Alloway & Joe Weisenthal.
In early April 2025, following an event referred to as "Liberation Day," the US imposed an effective tariff rate of nearly 30% across the board.
As part of a new deal, the US tariff on Chinese goods has been reduced from over 100% to a proposed 20%.
In response to US tariffs, China threatened to cut off its supply of rare earth magnets, which are critical components for batteries and computers.
The Trump administration, reportedly at the urging of NVIDIA's CEO, approved a deal to allow the export of advanced NVIDIA chips to China, reversing a key aspect of its technology containment policy.
An estimated 40% of US GDP growth in 2025 is attributed to AI-related capital expenditures, a contribution larger than that of consumer spending.
According to Standard Chartered, two-thirds of US economic growth in 2025 is being driven by the AI sector.
The AI industry is characterized by circular financial relationships, such as NVIDIA investing in CoreWeave, which then uses the capital to purchase chips from NVIDIA.
There is a concern that the AI sector's growing contribution to US GDP mirrors the housing market's role before the 2008 financial crisis, potentially making AI a source of systemic economic risk.
Joe Wiesenthal believes that both the success and failure of the current AI investment boom will likely result in significant job losses, either through a recession or through labor displacement by technology.
Since the COVID-19 pandemic, a significant divergence has occurred between US real disposable income, which is flat, and consumer sentiment as measured by the University of Michigan, which has plunged and remained low.
As of November 2025, the US unemployment rate was 4.6%.
Response rates to US government economic surveys have been declining, which has worsened the quality of economic data even before the recent government shutdown.