You're the second person to make that quote in this discussion. It's such a lazy sentiment. You do know that there are people who have long careers in options trading, right?
Yes, but in any market you need to realize that you are predicting the market, not the underlying reality. If the market is detached from reality you won't make any money by being right about reality unless you can predict when the market will move closer to reality. That's the crux of the quote and why it's generally a good counter to this kind of 'put your money where your mouth is' retort to predictions about reality.
(And in general, the market sentiment seems to be "There's a decent chance this all just blows over", so shorting is likely as ill-advised as plowing in long, unless you happen to have better insight into the decision-making in the white house than the average participant)
Of course it shouldn't be everyone's profession. Most people would and do fail miserably as options traders. A tiny minority though does make consistent long term money as option traders. What this tells us is that the qoute is refuted, because we have a counterfactual. There is indeed some rational system to the market that some people are able to figure out.
Just because the quote doesn't apply to everyone, does not meant the quote does not apply to anyone.
"The market can remain irrational longer than you can remain solvent" is true for me, for you, for the person who quoted it above, and for the median person reading it.
The fact that some people make a living off of attempting to beat the market, with...mixed success, doesn't mean that the quote is false.
> This is actually buoyed by buying ahead of the tariff
Actually, the way the report works is the opposite. The increase in purchasing ahead of the tariffs counted against GDP growth, in terms of how the numbers were calculated in this report.
To be clear: Trump is a disaster, and I disagree with his approach.
GDP is only calculated that way because the numbers for consumer, investment and government spending includes spending on imports, so it has to be subtracted out in order to get only domestic spending.
People buying and selling goods and services within the US are contributing to the GDP. If some people take some of that money they would've spent domestically and instead use it to import extra stuff (which doesn't count towards GDP), the GDP will go down.
Most of the value of an iPhone is recorded as American GDP because American IP and software went into it, Apple is keeping a lot of the price for the phone, and only sending a bit off to China for assembly (and a larger bit off to South Korea, Japan, and Taiwan for components that China is assembling). What remains is still a lot of American GDP.
A small business who is contracting China to make the thing that they then sell is also generating a lot of GDP. Yes, they send some percent off to China to make the thing, but a majority is GDP generated here in the USA (the small business does the design, marketing, sales, etc...). If they go belly up because of the trade war (very likely, since no one else can make their thing, and before China developed this capability, making the thing wasn't even possible!), that GDP is gone, the people that small business was employing are unemployed.
The increased purchases should not decrease American GDP, unless consumers are buying directly from China using Temu and are not buying at Walmart.
Yes, selling things contributes to GDP. But importing things does not. If you take money that you would've spent buying something in the US and use it to import something that you haven't sold yet, you've decreased GDP wrt the counterfactual.
Its not just selling things, it is designing those things, marketing those things, writing the software for those things, all of that is high value stuff that Trump is basically ignoring. There is a good reason we got richer after China entered the WTO rather than poorer: we focused on high value goods, IP, and services, which was only possible because we were able to outsource low value assembly to China.
If you take that money you would have spent buying something in the US that has imported parts (like its assembly), and instead say go out and by a DJI drone on TEMU, yes, you've decreased GDP. If you simply have no money to buy anything because DOGE decided to cut your federal job, then that would also decrease GDP.
I see where I got this wrong now: companies are stocking up on imports, but the GDP for those imports don’t go positive until they are sold to consumers (then whatever the sale price differs from the import price).
Trump will still be blaming Biden for this all the way down to the bottom and until the last day of his presidency, and his cult will eat that shit up.
The die hard supporters, yes, but his approval is already in decline across a bunch of key demographics (women, independents, hispanics). The only President that has been less popular in the first 100 days is... Trump (first term). The majority disapprove with the current handling of the Ukraine war, ending foreign aid programs, and immigration (his strong point). His approval on the economy has fallen 13 points since December, which should be alarming for his party, as that was a key factor in his re-election (Biden inflation concerns). He can blame Biden all he wants, but the majority of Americans identify current economy as belonging to Trump. It's hard to blame Biden when he's been so vocal and brazen about the tariffs.
This is actually buoyed by buying ahead of the tariffs, and the tariffs themselves haven't had a chance to take effect yet.
The economic nosedive is just beginning.