3rd May 2025

May 6

Written By OhMyEcon .

America’s GDP shrank 0.3% in Q1 2025, breaking a streak of growth and sparking political blame, with Trump citing a lingering “Biden overhang.”
Imports surged 41% as firms and consumers rushed to buy goods before Trump’s tariffs kicked in. While imports subtract from GDP, this doesn't mean they hurt economic activity.
Imports are subtracted because they aren’t produced domestically—but since they're already counted in consumption or investment, the net effect should be near zero.
Businesses stockpiled goods, boosting inventories by 2.25 percentage points—typically a sign of economic strength, not weakness.
Economists suggest the sudden trade spike was recorded by customs but not captured fully in consumption/inventory estimates—raising the chance of upward revisions later.
If Americans shifted spending toward imports at the expense of domestic goods, short-term GDP dips. But demand should rebound, potentially fueling later growth—ironically, helping Trump.

At 94, Warren Buffett announced he’ll retire as CEO of Berkshire Hathaway by year-end, surprising even his board and Greg Abel, his longtime deputy and successor.
Buffett turned a struggling textile firm into a $1.16 trillion conglomerate, achieving a 5,500,000% market return since 1965—far outpacing the S&P 500’s 39,000%.
Buffett has been pulling back from equities, including Apple, and Berkshire now holds $348bn in cash and short-term Treasuries—more than double last year.
Berkshire owns 5% of the U.S. Treasury bill market; if it were a country, it’d rank as the 10th-largest holder of U.S. debt.
Abel must deploy the cash wisely despite sky-high market valuations and a lack of obvious “value” buys. Foreign markets may offer better opportunities.
Abel is unlikely to abandon Buffett’s investing style—unless markets crash again, creating bargain buys. Investors hope he has Buffett’s eye for opportunity.

News written by Zhangir Meshitbek | Published by Zhangir Zhangaskin

2nd May 2025