Gold edged higher in the early morning Asian session amid worrisome signs for the U.S. economy. ...

Core Insights - The conference in Saudi Arabia brought together leading financial experts to discuss the implications of AI on investing and the U.S. economy [1] Group 1: AI and Investing - Experts highlighted the transformative potential of AI in investment strategies, emphasizing its ability to analyze vast datasets and identify trends [1] - Discussions included the integration of AI tools in portfolio management, which could enhance decision-making processes and improve returns [1] Group 2: U.S. Economy - The panelists expressed concerns about the current state of the U.S. economy, noting potential challenges such as inflation and interest rate fluctuations [1] - Predictions regarding economic growth were discussed, with some experts suggesting a cautious outlook due to geopolitical tensions and market volatility [1]

Economists say AI spending has kept the economy out of recession. When it slows, the effects could be widespread. ...

Economic Overview - The U.S. economy is described as a "tale of two cities," where GDP growth appears strong but is heavily influenced by AI expenditures, leading to stagnation when these are excluded [1][2] - The estimated U.S. GDP for 2024 is $29.18 trillion, with a projected growth of 1.8% in 2025, equating to approximately $530 billion. However, AI infrastructure spending by major companies like Google, Amazon, and Microsoft is estimated at $400 billion, suggesting minimal real growth when adjusted for AI [2] Consumer Debt and Economic Struggles - Household debt has risen by $185 billion, reaching $18.39 trillion in the second quarter of 2025, with auto loan balances increasing by $13 billion to $1.66 trillion and student loan balances rising by $7 billion to $1.64 trillion [4] - The auto sector is highlighted as a significant area of consumer struggle, with the pandemic stimulus checks creating an illusion of wealth that allowed consumers to qualify for prime loans despite underlying financial instability [5] Credit Market Concerns - The notion of prime credit scores is challenged, as many loans categorized as prime are actually subprime, indicating a misrepresentation of consumer creditworthiness [5][6] - The pandemic period saw a surge in car sales, often above sticker prices, driven by supply-chain issues and heightened consumer demand, further complicating the economic landscape [6]

Core Viewpoint - The Federal Reserve is expected to ease monetary policy, although this may not be a comfortable decision for some central bank colleagues [1] Group 1 - The need for easing monetary policy indicates a shift in the Fed's approach to managing economic conditions [1] - Potential discomfort among central bank colleagues suggests internal divisions regarding monetary policy strategies [1]

Core Insights - Economist Peter Schiff expresses concerns about Eric Trump's comments regarding the U.S. economy, suggesting they may reflect the White House's broader views on economic conditions [1][2][3] - Schiff interprets Eric Trump's prediction of a return to quantitative easing by the Federal Reserve as indicative of the administration's awareness of underlying economic weaknesses and risks of inflation [2][4] Group 1: Economic Predictions - Eric Trump forecasts a rally in Bitcoin to $1 million, attributing this to quantitative easing and an expanding global money supply [5] - Eric's previous comments on potential Federal Reserve rate cuts suggest a belief in significant market movements, contrary to prediction market odds [6] Group 2: Implications for Monetary Policy - Schiff implies that Eric Trump's views likely align with President Trump's stance on monetary policy, indicating a potential shift in the Federal Reserve's approach [3] - The comments from Eric Trump are seen as a reflection of the administration's understanding of the economic landscape, particularly regarding inflation risks [4]

Core Insights - The U.S. economy expanded at a surprising 3.8% from April to June, significantly higher than the previous estimate of 3.3% [3][5] - Consumer spending rose at a 2.5% pace, up from 0.6% in the first quarter, indicating stronger consumer resilience amid trade uncertainties [5][6] - A notable decline in imports at a 29.3% pace contributed over 5 percentage points to the second-quarter growth, reversing the trend from the first quarter [4][5] Economic Performance - The U.S. GDP rebounded from a 0.6% drop in the first quarter, which was the first decline in three years, primarily due to increased imports [3][4] - The underlying strength of the economy, measured by a specific GDP category, grew by 2.9% from April to June, up from 1.9% in the first quarter [6][7] - Private investment fell, including a 5.1% drop in residential investment, and federal government spending also decreased at a 5.3% annual pace [7][12] Labor Market - Job creation has slowed significantly, with an average of 53,000 new jobs added per month since March, down from an average of 147,000 previously reported [12][13] - The Labor Department is expected to report a modest addition of 43,000 jobs in September, with unemployment likely remaining at 4.3% [14][15] Federal Reserve Actions - The Federal Reserve cut its benchmark interest rate for the first time since December, with expectations of two more cuts this year, although strong GDP growth may influence their decision [15][16] - The Fed will closely monitor the upcoming personal consumption expenditures (PCE) price index for inflation trends [15]

Financial Performance - CarMax's sales and profits plunged in the latest quarter [1] Industry Trends - The tariff-strained auto industry sends up another warning sign about the U S economy [1]

Economic Outlook - U S economy is stronger than reported through the second quarter [1] Spending Analysis - Spending rose [1]

Core Insights - The most severe impact of trade wars on the U.S. economy may have passed, but businesses continue to face challenges from increased tariff-related costs and a decline in customer demand, leading to reduced hiring [1] Group 1 - Businesses are adjusting to higher costs associated with tariffs [1] - There is a noticeable slowdown in customer demand affecting business operations [1] - Companies are responding to these challenges by cutting back on hiring [1]