BY TYLER DURDEN
MONDAY, DEC 29, 2025 – 07:20 AM
Authored by Daniel Lacalle via The Epoch Times,
One year into Donald Trump’s new presidency, the verdict from the data is clear: the apocalyptic consensus forecasts have failed, and the United States stands as the only major developed economy combining strong growth, controlled inflation, and fiscal consolidation.
From the ‘Tariff Tantrum’ to a Global Surprise
When Trump announced his new wave of tariffs and trade policies, much of the global consensus rushed to predict a disaster. I called it the “tariff tantrum.” Commentators warned of an inflation surge beyond 2021 levels, 6 to 7 percent Treasury yields, collapsing investment, a recession, and global rejection of U.S. leadership in favor of supposedly more responsible European governments.
Twelve months later, none of those predictions has materialized. The 10-year Treasury yield has fallen to 4.1 percent. The United States is the only G7 economy growing robustly, while nations that intensified hyperregulation, climate restrictions, high taxes, and government spending are stuck in stagnation despite the tailwind of low oil and gas prices.
The “tariff tantrum” never became the structural shock that critics warned of. Tariffs, though debatable, do not cause inflation because they do not add currency units to the economy; uncontrolled public spending and monetary excess do.
Growth, Investment, and a Rare Fiscal Adjustment
The performance of the U.S. economy in 2025 is extraordinary, not only in relative terms but also on its own merits. Real GDP is growing at approximately 3.8 percent, with the Atlanta Fed tracking around 3.5 percent annualized in the third quarter. Private investment is expanding at near double-digit rates. Crucially, this is happening while federal spending is being cut—public expenditure has fallen by about 3 percent over the year, avoiding the use of unproductive federal outlays to mask weak growth.
Source:
https://www.zerohedge.com/economics/one-year-trumps-economy-defies-experts-and-outpaces-g7