⏩ Has America accelerated?

Some tantalizing hints can be found in new economic data and Walmart earnings

Acceleration nation? Has America's potential GDP growth rate increased since the pandemic? 

Or to put it another way: Is the maximum sustainable rate of US economic growth (without excess inflation, mind you) now higher than it was pre-COVID? If so, the welcome upgrade could be possibly due to factors like post-pandemic job market changes, the shift to remote work, or advancements in artificial intelligence.

To the top-line question, Eric Wallerstein, chief markets strategist at Yardeni Research, responds in the affirmative and offers some explanations:

Our answer is “yes.” This aligns with our views that: (1) strong immigration flows and record-high labor-force participation are growing the labor force (hence, the rise in the unemployment rate despite a healthy jobs market); and (2) productivity growth will boom over the rest of the decade as a result of widespread adoption of technologies like AI, automation, and robotics (as companies will need to augment their workforces with high tech despite the growing labor force).

Indeed, Wallerstein suggests in a new research note that the American economy's potential GDP may be closer to 4.0 percent, significantly higher than the Federal Reserve's long-run forecast of 1.8 percent.