Nearly the entire fourth quarter GDP was AI related, What happened?
The BEA’s GDP Report for 2025 Q4 dramatically missed estimates of 3.0 percent by GDPNow and 2.8 percent by Bloomberg Econoday.
AI-Related Spending Change in Billions
- IP Equipment: 50.4
- Software: 15.0
- IP R&D: 15.6
Real Private Fixed Investment
Real Private Fixed Investment Spending Change in Billions
- Private Fixed Investment: 27.9
- Private Nonresidential Fixed Investment: 33.8
- Private Residential Fixed Investment: -2.9
- IP Equipment, IP Software, R&D: 81
Percentage Point Contributions to GDP
Nonresidential Contribution to GDP
- 2025 Q1: 1.24 Percentage Points
- 2025 Q2: 0.98 Percentage Points
- 2025 Q3: 0.44 Percentage Points
- 2025 Q3: 0.51 Percentage Points
Nonresidential AI Contribution to GDP
- 2025 Q1: 1.24 * 99.6 / 81.0 = 1.52 Percentage Points
- 2025 Q2: 0.98 * 79.7 / 63.9 = 1.22 Percentage Points
- 2025 Q3: 0.44 * 34.6 / 28.5 = 0.53 Percentage Points
- 2025 Q4: 0.51 * 81.0 / 33.8 = 1.22 Percentage Points
The 2025 AI total contribution is 1.52 + 1.22 + 0.53 + 1.22 = 4.49 percentage points.
For the fourth quarter, AI contributed 1.22 percentage points of 1.40 percent, nearly the entire amount.
I anticipated AI would provide much less based on the GDPNow second-to-last estimate of nonresidential equipment and IP.
However, the GDPNow aggregate includes some items that subtracted from GDP.
Information Processing Equipment added 50.4 billion alone to Nonresidential Fixed Investment. Yet the total for Nonresidential Fixed Investment was only 27.9 billion.
Q: What happened?
A: The Transportation Equipment change was -27.6 billion.
Thus GDPNow aggregates cannot be used to estimate AI. Apologies offered.
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Yep, this is gonna be a lesson learned the hard way.
Nobody learns anything anymore. This is The Stupid Age.
Whatever. Funny how crime and scams, like the extended trillion dollar Al Gore anthropomorphic global warming scams’ windmill and solar costs, add to GNP or GDP, along with all those broken windows an illegal immigration crimes and welfare costs, an while adding to Mexico’s GNP too. Crime pays, hey Mish. .
Unintelligible
Learn to read English. Put simply, crime costs add to GNP: those costs of crime and scams and graft are not subtracted from GNP. Have a nice day.
So that’s what that was?
Are DT’s grifts calculated in that???
Global warming is NOT “anthropomorphic”.
It is anthropogenic.
Global warming is physics, chemistry, biology, geology, meteorology, paleontology, mathematics, statistics, etc, etc. Just because it’s too hard for you does not mean it is a scam. It just means you’re too dumb to get it.
Dark Ages Don,
China is building thousands of gigawatts of inexpensive solar power generation while guys like you are trying to recommission expensive antiquated coal burners.
China is passing us and leaving us thanks to the orange pedophile baboon.
But yes, follow close enough to keep your nose warm in his butt crack.
Thank you for your attention to this matter!
🙂
What is the EROEI for solar panels when you allow for all the inputs in the building, maintenance and full recycling of the panels? Plenty of panels will have an EROEI below 1 because greenwash subsidies have meant many panels are placed in stupid locations like northern Germany.
What are the odds (high) that China won’t fully recycle those panels but just extract the easy stuff and dump the rest.
Now there are certain environmentally advantageous technologies that have positive EROEIs but that does not include the current solar panels.
And your TDS is so bad that if Trump said we need to save the planet you would demand the opposite.
Look up the LCOE (without any subsidies) for all forms of electricity generation. The least expensive ways to generate electricity are solar, onshore wind, and natural gas.
Which is why in the US, almost all new generation comes from these three sources. With Texas leading the way.
2024: 30GW solar, 6 GW wind, 3 GW gas
2025: 35GW solar, 7 GW wind, 4 GW gas
AI will need 40-50 GW of additional power this year and 50-70 GW in 2027.
Get to the hospital, you’re having a stroke.
For those paying attention, private equity funds continue to blow up. Bitcoin dropping, firms tapping the repo box, gold/silver soaring, and bond yields dropping all point to liquidity draining and possible credit crisis right around the corner.
NVIDIA dropping today despite good earnings is yet another indicator that we may be on the verge of a big wave down.
Of course, the only way to play this market is to be hedged, sell calls, buy puts on rallies and sell puts and buy calls on corrections.
The whole world is waiting for what happens with Comex metals deliveries in March. That could be the tipping point.
I love the smell of profits in the morning.
The money rocket is moving to the launch pad, are you guys getting in?
I see hope or doom. For centuries, civilization has struggled with the problem of lying. It may be worse than ever now, as to lack of accountability.
With AI, they will be forced to do something. I don’t know how you force ethics into software but eventually handing our culture over to AI is why we have fiction such as “Collosus” or Dune’s Butlerian Jihad. This will get fixed….or else.
or else
How do you force ethics into AI? More to the point AI isn’t a single god but a pantheon of how many different entities be it a Western ChatGPT to a Chinese Deepseek all with different strengths and weaknesses and guided by backers with different aims be it CCP big brother control or western liberalism.
Add in malice, hackers, nilhilists, basement losers and greed and the AI ethics will be corrupted.
Alright then, thanks for narrowing it down.
Humans will be hunted to extinction, and I think that’s a good thing overall.
2 visions of the future
The Dept of War’s attack on Anthropic over the last few days certainly points to the latter. I would be amazed if the administration is not already figuring out how to divert Palantir from ICE roundups to swinging the mid-terms.
– wealth is distributed fairly amongst all of society.
> Toss that one out, as this will never, ever occur.
– Massive unemployment but a subservient population living in tents as the government has complete control over the narrative and has full surveillance on everybody
> We are pretty much here already, so they will want more than this.
Quite the dilemma staring us in the face!
ai is going to enrich the billionaires and millionaires and f**k the working men working women over! Job losses higher electric bills pollution and massive amounts of our drinking water used by ai
The benefits of ai go to the upper class 5 percent and we the citizens 95 percent get the negative results of ai
Note small businesses also get a f**king from ai
This is the story of humanity. Humans are innovators. We are always looking to find new and better ways to accomplish things. It’s been happening for thousands of years. And it will continue because you cannot prevent humans from thinking and innovating.
The benefits of this innovation are staggering. Two hundred years ago, over 90% of work was on farms. Today, less than 2% of work is on farms. Yet we produce so much more food.
Factory work was 40% in 1950 and 10% today.
The benefits, while uneven, have trickled down to the masses. Compare today’s living standards to those in the past.
Considering that it is impossible to prevent these productivity improvements, the question becomes how best to manage the benefits, and who gets them.
As an individual, I am always looking for ways to take advantage of the opportunities that this situation provides.
I am also aware that there are many that prefer government to ensure a fair distribution of the benefits available.
Quick question Papa, I have looked around but can’t find a definitive answer yet.
Can AI teach a class room, with a human involved of course, and if so, can they take over for Teachers? Home Schooling, etc.
Well television can do a lot of that already haha
AI can certainly teach curriculum. And if that was all that teachers did, then yes, AI could replace teachers.
One could argue the same for libraries. Just send the students to the library and tell them which books to learn the curriculum from.
Of course, teachers do so much more than curriculum.
I suspect that teachers will use AI to help them with curriculum which will enhance their productivity as well.
Or just put a television in front of students that technology works and is cheaper and lighten up Francis AKA Dave get s sense of humor man
It is fantastic for the learn by doing model. Tell it what you want to do, and it tells you how, and troubleshoots with you when things don’t work.
Agree. Yet another new learning tool.
I am actually pleased that you mentioned farming because we are heading towards a long term economic collapse which ai will speed up
We will have well over 110 million Americans out of work and maybe more
Solution we will have to grow our crops AKA food in victory gardens and local farms and farming is labor intense
There will be many jobs farming and this will be necessary to prevent mass starvation
You’re welcome.
Though I highly I doubt your scenario will happen.
You seem to enjoy schadenfreude.
Actually I do not wish millions of Americans including me becoming landless agricultural laborers AKA peasants
That being said I absolutely admire the Luddites most history books mock them but they stood up to automation AKA mechanization
Actually we already have 110 million or more Americans out of work so the next part would be ai destroying more jobs plus gas and diesel over $7 per gallon which would lead to massive numbers of Americans farming
Thank
You
Also
At least you did not call me a scheisskopf
At least not yet
I actually hope we do farming as it is a lot better than starving
Would be like the 1930’s, yes.
Subsistence, sharecropping.
Yes victory gardens local farming but hopefully not sharecropping it beats starving
Farm work is getting automated too. Now that the people that worked the fields are gone, there will be big money in Ag robots.
Yupp I am aware of it but I was thinking of a possible food emergency due to high gasoline and diesel prices
A strange post.
I do not expect gas and diesel prices to go up much for any lengthy period of time.
And gas and diesel represent just 3-10% of farm costs (depending on the type of farm). A small amount.
Dave the Luddites were actually high skilled craftsmen and women and they opposed mechanization because it was ruining their ability to survive
ai will benefit the rich and f**k. The poor
Fact: Technology advances had led to improved standards of living 100% of the time.
False, advanced technologies in logistics and weaponty made it possible to assemble large armies to kill millions in a single battle such as the Somme in WW1
Or more recently (2019) bioresearch made it possible to create a virus that messed with the entire planet.
So maybe only 98% of the time
Mike Shedlock AKA Mish not for the displaced workers
Trenton NJ after most factories shuttered we have a surplus of abandoned buildings dead end service jobs drugs and crime Trust me Trenton was much better when there were factory jobs the only factory here that you may know is the
Case Pork Roll Plant
Some call it Taylor Ham
And it might move to Pennsylvania
I am willing to give a guided tour for free of most of whatz left of our abandoned factories
Trenton Flint Detroit Youngstown all suffer from SSS AKA Silent Smokestack Syndrome and I forgot there a lot of bad assed bars and hookers in Trenton now thatz progress me being sarcastic
We disagree but I respect your opinions and read you five days a week
Even Facebook?
Yes. Some were. Some were highly skilled folks who lost their jobs when we developed machines that could do things faster and better. Just like all the highly skilled calligraphers were replaced by the printing press. Are you suggesting that we should still be hand writing books to keep the calligraphers employed ?
How about computerization destroying most newspapers here in America are you in favor of that? I cant find any newspaper that covers my local news and not much is online!
Then stop complaining and start up your own local newspaper to meet the local demand.
Read Player Piano by Kurt Vonnegut Jr. regarding displaced workers but perhaps you have read the book
So if destroying millions of jobs in factories and at farms was so beneficial how come we got millions of men and women unemployed and underemployed many of them who want to eork
Again, human innovation has been eliminating AND creating jobs for a very long time now. We are always eliminating repetitive, dangerous and crappy jobs and replacing them with better paid, more interesting jobs.
In spite of all our innovations and relentless job elimination, we still have 165 million people employed vs 7 million unemployed. Not the reverse.
One small example. The 363 mile long Erie canal was dug by hand with pick and shovels using 9000 laborers, mostly immigrants from Ireland and Germany from 1817-1825. No one thinks we should still be digging canals by hand.Or maybe you think we should.
Are you proposing that we stop all innovation and go back to how things were done 200 years ago?
7 million unemployed thatz 7 million collecting an unemployment check how about millions more not participating in the workforce
My point is thatz what is about to happen regardless of what I wish note I have been to the Erie Canal Question are amazons warehouses modern day wage slavery or innovation
Deindustrialization has contributed greatly to economic precarity for millions of Americans! Most of us are struggling but Dave feel free to take advantage of ai B4 it bites you on the ass! You sound too simplistic! Naive
Many factories had unionized jobs that paid laborers good wages and benefits
Enjoy your high electric bill maybe you can make an opportunity by investing in the power companies raising your bills
Of course I do. It would be foolish not to take advantage.
You enjoy high power bills and you are repetitive how many times you state take advantage
Pay sky high power bills and then invest in the company that f*”ks you thatz nutty
We are done you can comment or respond but you are nutty
I prefer to think of myself as a realist. Someone who understands what is happening in the world today; and also realizes that there is nothing he can do to change what is happening.
I cannot stop human beings from thinking or innovating. Neither can you. So innovation will continue.
I cannot stop those innovations from improving productivity and creating wealth. And I cannot stop those innovations from eliminating some jobs, while creating others.
Are you an ai robot you just are very repetitive for example I cannot stop haha
Nutty and repetitive and you can’t stop me noah body can
Most of us in this forum are in the 5%. Are we upper class? Do we have access to important government officials at $50,000 a plate functions or live in $100 million dollar mansions on billionaire island?
So the only real winners might be the .01% and even many of them will lose and become faded memories like the Vanderbilts
Prove that how do you know the income of men and women who comment? Thatz ludicrous
Sound about right, from what I have been reading. Who asked for this anyway, and what pockets are controlling this? I would follow the money, but they are not making it easy…
No one asks humans to think or innovate.
Control shifts constantly.
At this point, there are many constraints on AI development, including lack of power and memory chips. China has the power. The US does not.
A few months from now there will be different issues to overcome. Change continues.
PAY ATTENTION! AI/robots will do all the work. Humans will not have to work in the future. Stop worrying. Embrace change!
Robots will serve the rich, and oppress everyone else.
Jojo stop worrying get well be happy and smile and embrace your high electric bills no worries
I am getting even more jobs and working forever embrace beer