The Economy is Actually Booming - And We’re Misreading It
by Divya Kolmi
1/16/20262 min read
Richard Bernstein Says the Economy Is Booming
Let’s be blunt: saying the economy is weak has become fashionable, not factual. Complaining about high prices is now mistaken for evidence of economic decline, and discomfort is being confused with collapse. That is why Richard Bernstein’s claim that the economy is “actually booming” sounds offensive to some ears. It challenges a narrative people have grown comfortable repeating. But uncomfortable truths are often the most valuable ones in business and markets.
From a macroeconomic standpoint, the data does not describe a fragile economy. Nominal GDP growth is running at levels that, historically, align with expansionary phases - not recessions, not slowdowns, not “soft landings.” Companies are still selling. Revenues are still growing. Demand has proven far more resilient than expected. This is not what economic weakness looks like. Calling it weakness simply because inflation makes life harder is analytically lazy.
What people are really reacting to is inflation’s redistribution effect. Inflation punishes those without pricing power and rewards those with it. Firms that can raise prices without losing customers are thriving. Firms that compete purely on cost are struggling. This is not a broken economy, it is a selective one. The boom exists, but it belongs to businesses that understand leverage, differentiation, and scale.
This is where business strategy becomes inseparable from macroeconomics. In a genuinely weak economy, survival depends on cost-cutting and preservation. In a booming-but-inflationary economy, survival depends on pricing power. Companies that can brand, bundle, or position themselves as essential pass higher costs to customers and protect margins. Those that cannot are squeezed, not because demand vanished, but because they lack strategic insulation. The economy is not killing these firms, the market is exposing them.
Market behavior reflects this reality more honestly than public sentiment. Equity markets continue to reward firms with strong margins, recurring revenue, and pricing flexibility. Investors are not positioning for collapse; they are reallocating toward businesses that benefit from nominal growth. This is why repeated recession predictions have failed. The economy keeps refusing to slow in the way the narrative insists it should.
This also explains why expectations of rapid interest rate cuts are misguided. Central banks cut rates to stimulate weak economies. They hesitate when growth is strong but politically uncomfortable. If nominal growth remains elevated, easing policy too aggressively risks extending inflation rather than curing it. Markets hoping for cheaper money are not responding to economic fundamentals, they are reacting to voter and consumer frustration.
The most dangerous mistake businesses can make right now is assuming the economy is weak and acting defensively by default. That mindset leads to underinvestment, missed pricing opportunities, and strategic retreat in an environment that still rewards smart expansion. This is not a time to behave like demand is disappearing. It is a time to ask who has the power to shape demand and who does not.
The economy today is not failing. It is filtering. It is separating businesses with real strategic advantage from those relying on cheap money and thin margins. Calling this a “boom” feels wrong because it is not generous or comfortable. But denying its strength does not make it disappear. It only blinds decision-makers to the rules of the game they are actually playing.
Bernstein’s statement matters not because it is provocative, but because it forces a necessary reframing: the economy is strong, inflationary, and unforgiving - and pretending otherwise is a strategic error.
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