Growth in Q1 came at a solid 2%, the unemployment rate is sitting comfortably at 4.3%—near all-time lows—and jobless claims suggest layoff headlines are overdone. It’s also evident, however, that economic strength isn’t particularly broad. AI investment is driving the bulk of capex growth, and payroll growth is almost entirely thanks to robust hiring in healthcare. Both represent structural trends supporting the economy through otherwise cyclical weakness. Let’s also not forget government support. The deficit is still running around 5% of GDP—despite DOGE cuts—with personal transfers comprising nearly 20% of personal ... (full story)