[thfuran]

Yes, selling things contributes to GDP. But importing things does not. If you take money that you would've spent buying something in the US and use it to import something that you haven't sold yet, you've decreased GDP wrt the counterfactual.

[seanmcdirmid]

Its not just selling things, it is designing those things, marketing those things, writing the software for those things, all of that is high value stuff that Trump is basically ignoring. There is a good reason we got richer after China entered the WTO rather than poorer: we focused on high value goods, IP, and services, which was only possible because we were able to outsource low value assembly to China.

If you take that money you would have spent buying something in the US that has imported parts (like its assembly), and instead say go out and by a DJI drone on TEMU, yes, you've decreased GDP. If you simply have no money to buy anything because DOGE decided to cut your federal job, then that would also decrease GDP.

[thfuran]

Yes, but no one is designing an iphone from scratch over a couple weeks and ordering them built quick to try to beat the tariffs.

[seanmcdirmid]

I see where I got this wrong now: companies are stocking up on imports, but the GDP for those imports don’t go positive until they are sold to consumers (then whatever the sale price differs from the import price).