Financial markets are showing signs of renewed optimism as better-than-expected job numbers and strong consumer spending suggest the U.S. economy remains on solid footing despite political uncertainty. That’s the takeaway from James Perry, founder and CIO of Perry International Capital Partners, who joined Chicago’s Morning Answer to break down the latest economic indicators and what they signal for investors and policymakers.
April’s non-farm payrolls came in at 177,000 new jobs—slightly below the 185,000 forecast but still seen as a positive sign amid concerns over slowing growth. Perry noted that headline government labor statistics remain flawed, undercounting the actual labor market, which he says is 20 to 30 million people larger than official estimates due to informal and part-time employment. “The real labor market is very strong,” said Perry. “With unemployment still hovering around 4.2%, you don’t get recessions at these levels.”
Meanwhile, GDP for the first quarter was reported as a 0.3% contraction, but Perry dismissed the figure as misleading. He attributed the dip to an unusually large 14% spike in imports—a frontloading phenomenon ahead of anticipated tariff increases. Strip that out, he said, and GDP growth would have looked much stronger, potentially in the 3% to 4% range.
Citing strong business investment (+5%) and personal consumption (+5.7%), Perry joined former Trump advisor Larry Kudlow in suggesting that the U.S. economy is transitioning from a government-driven to a private sector-led recovery. With productivity on the rise, Perry believes the worst of the slowdown may be behind us. “I think Q1 will be the weakest GDP number of the year,” he predicted.
He emphasized that the stock, bond, and currency markets all paint a more bullish picture than the headlines suggest. “Corporate earnings are up 10% this quarter, which puts us in the top quartile of the last few years,” Perry said. “That’s not a recession. That’s growth.”
On fiscal matters, Perry is watching closely for movement on what the White House is calling the “big beautiful bill”—a package expected to include tax relief, spending cuts, and deregulation. While early leaks suggest proposed cuts may fall short of the $1 trillion-plus target, Perry believes even modest reductions combined with trade reforms could have a significant GDP impact. “If you take $500 billion off the trade deficit and cut spending by $250 to $400 billion, that all goes straight into growth,” he explained.
Despite persistent media fixation on trade tensions and tariff risks—particularly among European financial institutions—Perry views the realignment toward “fair trade” as a net positive. “This is a short-term disruption that resets the global order to benefit domestic productivity,” he said.
In the tech sector, Perry pointed to massive capital expenditures by firms like Google and Apple as proof that confidence in American innovation remains high. While Apple warned tariffs could cost the company $900 million, Perry called it a “rounding error” given the company’s $95 billion quarterly revenue and record profits.
Asked about Federal Reserve policy, Perry pushed back against market expectations of multiple interest rate cuts this year. With liquidity levels at all-time highs and strong employment, he sees no reason for additional stimulus. “The Fed doesn’t need to act,” he said. “The bond market is telling you inflation is moderating and the economy is steady.”
In closing, Perry reaffirmed his bullish outlook for the rest of 2025. “Personal wealth is at all-time highs, hiring is strong, and the U.S. remains the best place in the world for capital investment,” he said. “If policy can stay on course, this expansion still has legs.”
James Perry’s full analysis continues to provide a counterpoint to prevailing market pessimism, reinforcing the view that while risks remain, the fundamentals of the U.S. economy are far more resilient than many give credit.