Rebel Capitalist News GDP Shocks The Market...Has The Recession Arrived?
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Feb 20, 2026 A dramatic GDP miss and its market ripple effects set the tone. Discussion covers slowing personal consumption and rising inventories as signs of weak demand. Surging AI capital spending is highlighted as a narrow growth driver and potential bubble. Interest-rate moves, trade deficits, and the impact of a government shutdown are explored. Tariff uncertainty and fiscal limits round out the conversation.
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GDP Plunge Confirms Growth Disconnect
- US Q4 GDP crashed from an annualized 4.4% to 1.4%, far below expectations around 2.5%.
- George Gammon argues this confirms his view that GDP must realign with a weaker labor market.
PCE Spike Versus GDP Trend
- Core PCE surprised slightly higher, pushing short-term yields up despite the GDP miss.
- Gammon expects yields to fall once markets digest the larger trend of slowing GDP and disinflationary pressure.
Recessions Usually Bring Disinflation
- As recessions deepen, unemployment spikes tend to accompany disinflation, not accelerating inflation.
- Gammon cites 1970s data to argue stagflation during a downturn is unlikely.