U.S. Economy

This analysis provides a comprehensive analysis of the United States economy as of November 2025, addressing the query of whether its current status is one of a "boom" or a "downslide." The principal finding is that the economy is exhibiting clear signs of downsliding in the immediate term. This assessment is substantiated by a pronounced deceleration in the labor market and a pre-emptive, counter-inflationary interest rate cut by the Federal Reserve, which has explicitly prioritized mounting employment risks over persistent inflation.   The 2025 economy is uniquely defined by the simultaneous implementation of two contradictory, multi-trillion-dollar policies. This has created a state of extreme tension and volatility:   A Contractionary Trade Shock: A new, aggressive tariff regime has been implemented, acting as a significant, broad-based tax on imported goods. This policy is demonstrably raising prices, eroding household purchasing power, and creating a drag on economic activity.   An Expansionary Fiscal Stimulus: The "One Big Beautiful Bill Act" (OBBBA) was passed, enacting a massive, deficit-financed stimulus by extending the 2017 tax cuts. This policy is designed to boost demand and investment.   The current "downsliding" dynamic is a direct result of the tariff shock's immediate contractionary impact, which has, for now, overpowered the stimulus. The Federal Reserve's October 2025 decision to cut interest rates confirms its judgment that "downside risks to employment" constitute the most immediate threat.   This analysisU.S.  forecasts a volatile and unstable path. The 2025 slowdown is expected to give way to a temporary, stimulus-fueled "sugar high" in 2026, as the OBBBA tax cuts take full effect and boost demand. This artificial boom is projected to fade quickly by 2027-2028, revealing an economy structurally strained by a gross national debt exceeding $38 trillion, a persistent $1.8 trillion annual deficit, and a deteriorating net international investment position of -$26.14 trillion. The new policy mix has locked in this structural weakness.