Fresh Air Confused By The U.S. Economy? You're Not Alone
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Oct 22, 2025 
Zanny Minton Beddoes, Editor-in-chief of The Economist with a strong background at the IMF, dives deep into the U.S. economy's complexities. She discusses the rising influence of AI on the stock market and the uneven benefits felt by non-tech sectors. Zanny highlights how tariffs and immigration policies are reshaping job markets, particularly in agriculture and construction. She also warns of potential pitfalls, including health care staffing shortages and the risks of an AI-driven bubble, offering both best- and worst-case economic scenarios.
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Two Economies: Markets Versus Main Street
- The U.S. economy shows a split: real-economy weakness vs. stock-market euphoria.
- AI optimism fuels market gains while tariffs and immigration create real-world uncertainty.
AI Concentrates Market Gains
- Roughly 40% of recent stock-market gains come from big tech tied to AI, especially the 'Magnificent Seven'.
- Investors not holding those stocks have seen much weaker returns and less wealth effect.
Tariff Threats Versus Real Impact
- Many proposed tariffs were threatened then scaled back, so the average effective tariff rose less than feared.
- Firms often absorbed tariff costs in margins short-term, delaying consumer price increases.