Whether you like prediction markets for the cutting edge, real-time information,…

Robustness of action, or you “just like it”, at some point you have to decide what you’re going to do with the information you’re given.

It’s one thing to have an opinion. It’s one thing to believe in a company, stock, or CEO.

But it’s another thing to put your money behind it. Prediction markets may be more clear of a signal than ‘fundamentals’, technical analysis, and even sentiment.

To have ‘skin in the game’ changes everything. (Great book by the way)

Right now, prediction markets are putting real money up saying Trump's economic boom is happening.

Trump's "economic boom" is priced at 66% on Kalshi, with roughly three times the trading volume of his "bad year" scenario (sitting at just 18%).

Strongest in two years.

This is more than sentiment. The boom is real.

But is it really possible?

Not if you listen to financial media fear-porn each about: "Recession fears mount," "Is a downturn coming?" "Here's how to prepare for the next recession."

I get it. Fear sells. I’ve written about it. Uncertainty gets clicks.

And “experts” who aren’t putting money where their mouth is, ts can always hedge with "we said it could happen."

But at some point you gotta see the light.

Not in a metaphysical sense, but in a prediction market sense.

Prediction markets don't have that luxury.

They can't write "Recession odds are elevated but timing remains uncertain."

It either is or it isn’t. Sure things can change. But look…

Contracts wouldn’t be purchased for Trump’s Econonomic boom unless there were real reasons behind it…

Let’s find that reason right now…

The real question isn’t whether there will be or will there not be a boom…

It’s what would it actually take to see a genuine economic boom? What does 5%+ GDP growth require? Then work from there.

Let’s go.

First, 5% quarterly real GDP growth isn’t abnormal.

America used to hit that regularly. Again and again.

Skip the 2021 situation that was an anomaly.

We can agree on that.

Before that, 2000s gave us the occasional 5% quarter: Q3 2003, Q4 2003, and even Q2 2014 squeaked out a 5%+ print.

But even those were few and far between that what we say in the 60s, 70s, and 80s.

The Reagan-Volcker recovery (1983-84) logged several 5%+ quarters as the economy snapped back from the early-1980s double-dip recession and rates fell from extreme levels.

What happened?

How did we as a country crank out GDP banger after banger and then nowadays it takes a pandemic-level response to jolt us above 3-4% GDP??? ¯ \_(ツ)_/¯

I don’t know.

But what I do know it is 5% growth isn’t impossible.

Since we know it’s possible, here’s what it would take to get there, and perhaps, how it’s happening now…

First, to see a 5%+ real GDP print in any quarter, you need a jolt of strong demand and you need the usual heels not to show up at the same time—no sudden financial accident, no external shock, no global shutting things down. .

Trump has called for a record $1.5 trillion defense budget for 2027—roughly a $500 billion jump from the $901 billion authorized for 2026.

Massive potential boost to federal demand if Congress even partially agrees.

The FY 2026 discretionary request already raises defense outlays about 13% and sharply increases Homeland Security spending, which points to ongoing fiscal support rather than austerity.

I have a hunch we’re not stopping there.

Government spending—check.

The Department of Energy has identified 16 federal sites that are “uniquely positioned for rapid data center construction,” with the goal of getting AI‑focused facilities built by 2027 through public‑private partnerships.

Trump’s AI Action Plan and his Executive Order on “Accelerating Federal Permitting of Data Center Infrastructure” fast‑track large (100‑MW‑plus, $500‑million‑plus) projects, streamline environmental reviews, and prioritize grid and transmission upgrades so these power‑hungry sites actually have the juice they need.

That adds up to a capex wave (structures, equipment, power plants, high‑voltage lines, and networking/semiconductor gear) showing up as stronger fixed investment in GDP.

Just doing some back of the envelope math here…

If those 16 sites ultimately host on the order of $1–2 trillion in combined capex over 4–5 years, you’re talking about roughly $250–500 billion per year of extra investment once it starts taking off.

In a 28‑trillion‑dollar economy, that’s roughly 1–2 percentage points of annualized growth in the peak build‑out years, before you even count multiplier effects.

It doesn’t guarantee a 5%+ quarter in 2026, but it’s big enough that, if consumers keep spending and the Fed doesn’t slam the brakes, this AI‑energy‑defense build‑out could easily be the difference between another 2–3% slog and a “Trump boom” quarter with a 5‑handle.

For consumption to drive a boom, real incomes have to be growing—wages need to beat inflation, unemployment can’t spike, and housing can’t be in free‑fall.

Real average hourly earnings rose about 1.1% (0.9% for rank‑and‑file workers) from December 2024 to December 2025.

Surveys and pay‑cycle data point to 2025–26 salary increases still running a bit ahead of expected inflation, which implies real pay stays positive if price pressures keep easing.

But if we want further evidence the consumer is doing well (or not), the other way to gauge the health of the consumer is from credit card companies.

IMO, there’s no better real-time consumer tracker than the credit card companies.

Card issuers back us up: Synchrony just reported record Q4 purchase volume (about 3% year‑over‑year growth to $49 billion), and management keeps using phrases like “consumer resilience” and “robust spending habits,” even as they guide cautiously on lower‑income borrowers. They’re supposed to the lower “K” of the “K” economy. yea, they’re doing fine.

Delinquencies have largely normalized and stabilized, and card issuers are guiding to mid‑single‑digit spending growth in 2025. Rating agencies summarize as ‘healthy but more cautious.

I get it, people may not feel rich after five years of inflation, and companies aren’t letting us off the hook.

But on a macro‑math basis, real wages are creeping higher and most households still have enough income and credit to keep spending.

I mean, how many subscriptions do you own right now that you don’t need?

Trump has effectively neutralized the risk of any major recession triggers like oil shocks (Remember 1973? 1979? 2008?)

After the Maduro thing, his administration moved to ease sanctions and redirect 30-50 million barrels of formerly sanctioned Venezuelan crude to the U.S. at market prices.

Venezuelan lawmakers just passed reforms that open the oil sector to private firms and invite U.S. investment, with Trump publicly saying the U.S. is now "in charge" of getting that oil to market.

Translation: Trump literally seized an oil producer and turned it into a supply-side tailwind.

No oil shock. No energy crisis derailing growth. Box checked.

How many “economists” and “experts” are walking back statements, about how Kevin Warsh is/was a “hawk” but he’s “not really a hawk now” since he (will soon be formally nominated).

First they said he was a hawk. Then he’s a nice hawk. “oh, he’s disciplined”.

No, you’re all over the place.

I called him a hybrid.

[/https://www.predictionmarketedge.com/p/rick-rieder-under-10-is-the-wildcard-we-want]

People forget he was a Morgan Stanley guy way back in the day. He’s lived both lives.

Point is, economists are a million times more wrong that right. And Trump's team emphasizes removing regulatory bottlenecks, not tightening.

ZIRP 2.0?

After printing 4.4% in Q3 2025 we’re sooo close.

The conditions for 5%+ are in place (or actively being built):

We’re not lifting the foot off the gas until we see God or a checkered flag.

In the macro-prediction market sense, the checkered flag is a 5% quarter real GDP growth. With resilient consumer, Trump spending, AI/energy build-outs, space (it’s coming), we’re closer than we think.

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