Forward Guidance The Hidden Fractures Behind America’s “Resilient” Economy | Aahan Menon
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Dec 3, 2025 Aahan Menon, a macro investor and founder of Prometheus Macro, explores the deceptive strength of the U.S. economy, driven by AI investments and consumer spending from wealth rather than wages. He discusses the disconnect between nominal and real growth, the instability in the bond market, and how traditional recession indicators are losing relevance. Aahan also shares insights into liquidity transmission and offers practical trading advice, emphasizing the need for adaptive risk management and realistic expectations for investors.
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Surface Strength Masks Deep Divergences
- Nominal spending remains strong driven by affluent consumers and AI CapEx despite weak broad employment.
- This creates large divergences under the surface that mask sectoral weakness.
Profit Juice From Nominal Growth
- Nominal growth can flow directly to corporate profits when wages don't rise proportionally.
- That decouples profit cycles from real GDP and breaks classic profit-growth rules of thumb.
Investment Boosts Profits With A Lagged Cost
- Gross investment raises macro revenues but associated costs (depreciation) show up later as capital consumption.
- This timing makes investment a large near-term profit boost with lagged future drag.