Lately, most respondents to political surveys have listed the economy as one of their top three concerns. Therefore, it seems proper to examine how various economic components have been performing during the first quarter of the Trump administration.
While examining these numbers and trends, one should keep in mind that, typically, presidential terms span sixteen quarters. A lot can happen during the remaining fifteen quarters that may reinforce or reverse what happened during the first quarter. Be that as it may, here is a snapshot of the first quarter performance of various components.
INFLATION: Positive
| JAN | FEB | MAR | |
| INFLATION RATE | 3.0 | 2.8 | 2.4 |
The inflation rate, as reported by the U. S. Bureau of Labor Statistics, has been declining during the first quarter.
The goal of the Federal Reserve System is to keep inflation at around 2.0%. Although we are not there yet, the trend is in that direction.
While inflation affects everyone’s pocket, retirees and others on fixed incomes are affected the most. The current trend is good news for those folks.
GROSS DOMESTIC PRODUCT: Negative
Here is what the U. S. Bureau of Economic Analysis (BEA) had to say about this:
“Real gross domestic product (GDP) decreased at an annual rate of 0.3 percent in the first quarter of 2025 (January, February, and March), according to the advance estimate released by the U.S. Bureau of Economic Analysis. In the fourth quarter of 2024, real GDP increased 2.4 percent.
The decrease in real GDP in the first quarter primarily reflected an increase in imports, which are a subtraction in the calculation of GDP, and a decrease in government spending.”
This last quarter contraction is a drastic reversal from the trend in the last three years. The last time we experienced a GDP contraction was in the first quarter of 2022.
However, the explanation offered by the BEA is quite accurate.
We had a shopping spree for imported goods to beat the upcoming price increase generated by tariffs.
Since the federal government is such a large consumer, any decrease in government spending has a negative effect on the GDP.
Like everything in the economy, the GDP will eventually bounce back to a more traditional rate of growth, once we adjust to the new trade as affected by tariffs and a new, leaner federal government.
UNEMPLOYMENT AND JOB CREATION: Positive
The unemployment rate has held at around 4.2% during the first quarter. That is close to 3.0%, which is considered ideal by many economists.
The number of jobs added is often the recipient of numerous adjustments up or down. The most recent numbers we have been able to find are as follows:
Jobs added in 2025
January: 143,000
February: 151,000
March: 185,000
These numbers show a solid pattern of growth despite uncertainty about the net effect of tariffs.
STOCK MARKET: Negative
Markets hate uncertainty. Uncertainty very closely characterizes the tenor of the economy during the first quarter. Any time that substantial changes in economic policy take place, uncertainty about the outcome is likely to occur.
Eventually we will know the long-term result of the current tariff policy, reduction in government spending, and other measures introduced by the Trump administration. Until then, we will have to contend with market volatility.
Most individuals do not, and should not, pay much attention to the fluctuations that happen in the world of stock markets. However, the desirable outcome is for the value of stocks to increase over time. In that regard, the first quarter of 2025 has not been kind to stocks. Here is the performance report for three major stock indices:
| January 1 | March 31 | Change | |
| Dow Jones | 42,392 | 41,990 | -0.95% |
| S&P 500 | 5,869 | 5,633 | -4.02% |
| Nasdaq | 19.281 | 17,447 | -9.50% |
Many IRA, 401-k, and other individual retirement arrangements have a substantial portion of their assets in stocks. Retirees who are drawing monthly checks from those retirement accounts are very likely feeling the pinch to a greater degree than the rest of the population.
While we are focusing only on first-quarter performance, it is noteworthy that the market decline has continued through April and the first week in May. This should be of some concern to the administration because the demographic group that is affected the most by this trend is very likely to contain a substantial number of Trump supporters.
If government jobs and spending is what has been buoying national GDP this much, maybe it’s influence should be downsized and recalculated for the loss of money through taxes and regulations enacted as a result.
LOL. This is a very. Jase’s view on the orange man’s economy. Look at the real indicators and you’ll see it’s the worst economy of any president in their first 100 days.
sir, if as you say the very worst – we are still saving vast amounts of dollars – CHINA is not a partner they are an enemy – to the toon of TRILLIONS ! Stopping the bleeding that has been going on for many years ; A HUGE PLUS! We paid and paid.. no end – just in immigration COSTS ALONE under Biden – Will the dollar survive? I don’t think its a given – the damage done is immense; no better potential than under the current plan to solve that cancer that has eaten the country for years. The DEMS wanted to destroy USA, so if your right you win, it’s destory.. better to die fighting that capitulation
Okay, show us the real indicators.
Thanks for putting this together, very helpful.
think the market has dropped – try India nuking Pakistan.. or the other way around ; see what the market does when the Jennie is out of the bag – of course it’s Trumps fault, regardless of the generational war
how about ‘China’ egging Pakistan to un-stabilize India’s economy to ferment distrust of the economy of India as a Mfg. entity able to replace China – Huh? makes sense doesn’t it – China flexing it’s world geographic muscle on global economic policy in mid trade war.. to it’s advantage. Playing with nuclear neighbors – the time of sorrows and woe – closer than we think