AI Frenzy Drives Dow, But Economy Lags Behind

By Kamran Afshar, Ph.D. · 22 November 2025 AA Larger text

In the absence of GDP updates, the best data point for assessing the economy's growth is personal consumption expenditures, which accounts for almost 70% of GDP and has a 93% correlation with it. Based on that, our model estimates 2.4% growth in GDP. The DJIA, as of the end of October and before the recent corrections, had increased by almost 11% after inflation adjustment, more than four times the economy's growth.