The first estimate put fourth quarter 2025 GDP growth at 1.4%. Then it was revised to 0.7%, and then to 0.5%, by which point most people had moved on. In Episode 032, Luke Tatum, Nicky P and Rob Brayton talk about why official economic numbers get so little scrutiny, why the economy isn't a machine anyone can tune, and which books will help you see through the data. They close with how easy it is to pick a number that tells the story you want.
“People do random stuff”
There's no better example of trust me, bro economics than official economic data. The big number comes out, everyone reacts, and by the time it's quietly corrected, the world has moved on. This week's example is fourth quarter GDP.
What We Covered
Q4 GDP: 1.4%, then 0.7%, then 0.5%. The advance estimate put fourth quarter growth at 1.4%. The next estimate cut that to 0.7%, and the latest, reported by Reuters, cut it again to 0.5%. That's less than half the first number, months after the quarter ended.
No accountability. Rob points out that markets move on these numbers, and so do people's futures, yet nobody answers for getting them wrong. Nicky's version: the first number makes the front page, and the correction ends up on page 63.
The economy isn't an engine. The Keynesian establishment treats the economy like an engine that stalls and needs the right maintenance. But it isn't a machine with non-human parts. People do random stuff.
“Once you know what’s going on, you know what to do.”
Why GDP counts government spending. One thing I can't stand about GDP is that it counts government spending as output, when the government doesn't make anything. Rob adds that pulling one lever at the Fed was never going to run the whole economy.
Man, Economy, and State. If you want the foundation, read Murray Rothbard's Man, Economy, and State, which builds up a whole economy with no government, then Power and Market, which shows what goes wrong when you add one. Rob suggests a lighter start: Henry Hazlitt's Economics in One Lesson.
Incentives matter. Nicky boils the Austrian view down to one idea: incentives matter, for every person on the planet. That's what Hayek called the fatal conceit: no small group can decide for millions of people how the economy should work.
“Prices tell you how relatively in demand something is”
Second and third order effects. Nicky points to oil. It affects transportation, which affects nearly everything else. Look at one piece in isolation and you get the wrong picture.
Why price caps cause shortages. When gas prices spike, a common government response is to cap them. Prices tell you how much something is in demand compared with the supply. Hold the price down and you run out.
Pick a different number. US payrolls rose by 178,000 in March, after falling in February. Zoom in and things look good. Zoom out and they look bad. It takes seconds to frame data so it tells the story you want.
Key Takeaway
You don't have to trust the official numbers to plan well. What matters is building something you control that doesn't depend on whatever Washington reports next month. At Perfect Spiral Capital, we use properly designed whole life insurance for that, with cash value that grows on a contractually guaranteed basis.
Key Moments
[2:00] No Accountability
[4:00] The Economy Isn't an Engine
[6:00] Q4 GDP: 1.4%, Then 0.7%, Then 0.5%
[8:00] Corrections Nobody Reads
[9:00] Why GDP Counts Government Spending
[12:00] Man, Economy, and State
[17:00] Incentives Matter
[19:00] Second and Third Order Effects
[20:00] Why Price Caps Cause Shortages
[21:00] Pick a Different Number
“It takes seconds to manipulate and lie to you”
Related Episodes
Episode 010: Does a Government Shutdown Hurt the Economy? Trump's Permanent Cuts and 23% of GDP
Episode 045: The Fed's $41 Trillion Problem: Why the White House Stopped Showing the Numbers
Episode 007: Why Record Stock Market Highs Don't Mean a Healthy Economy
Want the full conversation, including our reading list for seeing through the data? Listen to the full episode and grab the free toolkit at PerfectSpiralCapital.com/podcast.
FAQ
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Early GDP estimates are based on incomplete data and get revised as more comes in. The advance estimate for fourth quarter 2025 was 1.4%, the second estimate was 0.7%, and the third, released in April 2026, was 0.5%. In Episode 032, Luke Tatum's point is that the revisions get far less attention than the first number.
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Luke Tatum and Rob Brayton suggest treating it with caution. Numbers get revised, definitions change over time, and the same data can look good or bad depending on the time frame you pick. Look at the broader picture rather than one headline number.
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GDP measures total spending in the economy, and government spending is one of its parts. Luke Tatum's objection is that the government doesn't produce anything with that money, since it comes from taxpayers, so counting it can make the economy look healthier than it is.
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Luke Tatum recommends Murray Rothbard's Man, Economy, and State along with Power and Market. Rob Brayton suggests starting with Henry Hazlitt's Economics in One Lesson, which is much shorter. The Mises Institute offers many of these books free, including as audiobooks.
Show full transcript
Between The Lies: Episode 032 Transcript
Nicky P: Winning bigly. That's what the administration would have us believe, but it's easy to do when you can just lie and let the correction fester. In the background. Welcome to the Between The Lies Podcast, your weekly lesson on how to approach an uncertain world with positivity and balance. I'm Nicky P here with my good friends and money brains, Luke Tatum and Rob Brayton from Perfect Spiral Capital, as they help us navigate the snares and pitfalls in a world of trust me bro economics.
Stick around to the end of the video for their free toolkit and be sure to like and subscribe if you enjoy what you watch, gentlemen. Is this the wool being pulled or is it straight up lying?
Trust Me, Bro Economics [0:00]
Luke Tatum: Gosh, you know, we have our group chat where we talk about what we're gonna do for the podcast and everything, and there's no shortage of crazy stuff going on these days, but I don't think you could really get a more perfect example of, trust me, bro, economics than the, you know.
Department of Labor, you know, and, and stuff like this. Giving us data on things. It's like, oh yeah, it's totally gonna be super awesome. We totally know what we're talking about. You know, this happens every quarter, every month, you know, it's, we're probably gonna have like job growth, bro, and it's gonna be big.
And, yeah. Don't worry about the economy. Everything's totally fine here. How are you know? And. Then it's it, whatever. We just make up something else the next month. Meanwhile, the actual numbers start to come in and we go, oh, wait a minute. It actually wasn't good when you said it was good. You know, like, but to your point, right before we hit record, like the world's already moved on.
We're already worried about the next testament. We're not really, we're not really sitting here and, and talking about. Two months ago, job numbers, or two months ago, GDP growth or two, you know, whatever. It's just, it's tiresome to say the absolute least. What's your take on this, Rob?
No Accountability [2:00]
Rob Brayton: Yeah, I, it's so crazy because we have this situation where these numbers are always fluctuating and there's no, no accountability for it, right?
Like. There's no one to come out and say, Hey you basically lied to us last month. Now you're trying to tell us that this is the truth. Like what do we actually believe? I think that's the hard part to swallow in that we, there just is no level of accountability there and I mean, we shouldn't be surprised, right?
It's government like they, that is how they work and we have a long history of seeing that's how a government operates, so. You know, it's one of those areas where it's extremely frustrating and you see how a lot of people are impacted by how all these things work. There's a lot of people invested in the marketplaces and they're, futures are constantly shifting, based upon how all these results, these numbers, these different things come out.
You would think that with so much riding on all of these, different facts, different figures, signs, like vital statistics of the economy, you would think they would actually be accurate. And you would also think then, because it impacts everyone so much that they would be more vested in seeing that the number's true.
But we just don't see that. I think there's a. A lot of people just get more apathetic about it because it's like, well, I can't personally change it. And I think that's the, that's the frustrating part, right? So it does end up in a, oh, just trust me bro. It'll be okay. And it's sad, but that's kind of how it's been operating.
And you know, unless a large group of people stands up and says, no, we're is not gonna take this anymore. It's probably not gonna change.
The Economy Isn't an Engine [4:00]
Luke Tatum: I haven't actually seen the movie, but, there's that famous speech from, I think it's called Network, the, you know what I'm talking about, Nick? Yeah, yeah. It's just that, that kind of fire and, and you know.
Refusal to take it anymore. I mean, we haven't seen that kind of energy, I don't feel like in this country in a very long time, to put it mildly. But we're sort of taught that the economy or the Keynesian economic establishment is, it sort of treats the economy as though it is an engine that stalls sometimes and we just have to get in there and, you know.
Do just the right maintenance to get everything, just how it should be so that we can proceed with our never ending trajectory of economic growth and. That just isn't what it is. Like that's such a poor metaphor because this isn't a machine with non-human parts, you know, churning together, you know, gears or whatever.
Like that's not what economics is. People do random stuff, you know?
A Machine With Animal Spirits? [5:00]
Nicky P: You know what I'm gonna call this, make this even more ridiculous. What's funny is that like you, while you say that, you know, the Austrian way is one that actually treats it like a moving machine and respects how complicated the machine is.
Like the Keynesian way is to treat it like a machine while simultaneously believing there's animal spirits. So. It's a little frustrating to think that we're allowing people that can't even, you know, keep metaphors straight on their ideology, allowing people to like tell people how things function.
Q4 GDP: 1.4%, Then 0.7%, Then 0.5% [6:00]
Luke Tatum: Right. Right. I mean, but I guess let me just give an example of kind of how, you know, the numbers, kind of what we're talking about this week. And why we're on this tangent in the first place, maybe in some more detail because I feel like we do this, where we go right into our commentary without actually fully explaining the story.
So the US fourth quarter, GDP growth. Revised down. Okay, so here's the story. The leading indicator, and this is a Reuters article that we can link in the description, but the advance estimate for Q4, the, you know, official number before all the math was done, before all the numbers were in was GDP growth of 1.4% for Q4, which you know, isn't gigantic anyway or whatever, but 1.4% and then.
We go, well, okay, all the math is in, and we think it's 0.7%, right? So half of what they said it was gonna be, and then we've, this today's news is that we're revising again what happened in Q4, which at this point is three months ago, four months ago. And so we're saying, well now it's actually only 0.5. So it's less than half of what we told you it was gonna be before the quarter was over.
Again, like what's the accountability? This article, you know, has a few viewers by policy wonks and people that work in the DC Beltway so they can go complain to their congressman about it or whatever. But that's it. I mean, a, most people are not reading this article. They don't care. I mean, I don't even care that much.
You know, it's just, it's just knowing that it's like. How wrong it is and how off track these official estimates are is so silly.
Corrections Nobody Reads [8:00]
Nicky P: That's what they say. It's the lies made it twice around the earth. By the time the truth gets outta bed, you know this is gonna be on what page? 63. Whereas you know when you, they've got good things they wanna tell you, oh, front page news and then the correction.
No one ever reads it.
Luke Tatum: You know, I kind of miss the, you know, not that I really was like a newspaper guy for a long time, but when people were reading newspapers, you kind of knew like the really interesting nuggets were way deep in the back, you know, the front page news is the distraction. Nowadays, we have all these.
Layers of complication to that process. News aggregator websites, and all this stuff in AI now. Right.
Nicky P: The question I have to ask is this, you know, since the truth, you know, it gets buried, it never comes out. Is it possible for the economy to file a libel case against the administration?
Rob Brayton: I dunno if that's possible.
I mean, the economy's a very broad. Very broad concept, right?
Nicky P: Look, if corporations can be people, I think it's possible for inanimate concepts to use legal recourse.
Why GDP Counts Government Spending [9:00]
Luke Tatum: Rob, you and I are both part of the economy, okay? We that, you know, the correct understanding what the economy is it's the combination of the individual decisions of all the people, right?
Like that, that buy the sell. Actions of all of the people all the time. Right? And so the thing, gosh, I mean talking about. What's wrong with government statistics and that stuff? The thing I hate about GDP is that you get to count government spending, right? And it's like the government doesn't make anything.
We were talking about that before the show too. They all the money that they have, I mean, not to get Nietzschean and existentialist on the show or anything, but you know, everything the government has, it has stolen, right? And so what if I wanted to buy something? Well, I don't get to because my. Payroll taxes, you know, whatever.
All the taxes we have to pay the sales tax. I mean, sales tax is darn near 10% where I live, and that's with money that already got taxed, right? So it's not a good time. And then especially the types of things that the government chooses to spend its money on. Like, I would never have voluntarily funded these things if I had kept my money.
And so it's. Kick 'em while they're down, kind of a mentality.
One Lever Doesn't Run the Economy [10:00]
Rob Brayton: Yeah. I mean, it's the same concept, like if you think about government spending as a whole, right? Like what I spend, you know, six or seven out of every $10 on guns for my home and, and then the rest goes to my living expenses.
Luke Tatum: How pro liberty are you, Robin?
Rob Brayton: I mean, some people probably do and whatever. That's okay too. I like guns. Like it's not a big deal, but yeah, it, I mean it's so interesting, right? Because you think about like the Fed and we pull this one lever and that's what drives the economy, right?
Like with interest rates and it's like, it's so ridiculous. To think that there's actual control at that level and there just isn't, and it would, I think what people don't realize is that if government didn't exist, economy would still happen and it would operate in a much more effective process than what it anybody even thinks it could, because it just hasn't truly been done.
I mean, there's been iterations in small pockets of history where that's occurred, but generally speaking, it just hasn't been done. So
Nicky P: Well run in with your metaphor. It's, they pretend that they've got like a way to inject fuel better when what they really have is a way to remove the governor that they put on in the system.
It's like, yeah, when the machine's only operating at 70% efficiency because you screwed it up. Sure, yeah. You can make it go faster when you stop screwing it up.
Luke Tatum: That's true. That's true. So if you just leave, it always kind of broken. You've got lots of room to fix things, you know?
Rob Brayton: And sometimes they leave it broken for a long lot longer than it needs to be.
Right?
Nicky P: But isn't that truly the nature of government right there is keep things broken so they can take your money to fix things.
Man, Economy, and State [12:00]
Luke Tatum: Break your legs and hand you some crutches, and then like, aren't you gonna thank me, right? I'm gonna out myself real quick, but, to anyone who hasn't, which is 99.9% of everyone who ever will ever watch this episode, read Man, Economy, and State by Murray Rothbard.
It's a thousand plus page economic treatise, and then Power and Market at the end. It's like an addendum at the end, and the idea is. Rothbard builds up how an economy works, very complex mechanisms buying and selling of, you know, incredibly complex things, and all of it from the very beginning, most basic, simplest possible economy, all the way up to like a modern economy.
All of that is done with no government and then Power and Market. The extra addendum is okay now if you stick a government in there, here's what gets messed up and here's why. And so I, you know, I don't know, man, I don't know what to tell you. Go read that book. That's a pretty good foundation.
That's maybe the best foundation.
Start With Economics in One Lesson [13:00]
Rob Brayton: Yeah, I agree. It probably is the best. I mean, I personally haven't read it, but I read it completely. But I've certainly. Seen different aspects of it. But I would say if maybe you're not that ambitious, at least do Economics in One Lesson by Henry Hazlitt, a phenomenal book, that really helps you to understand the basics of how things actually operate.
Although if you look at the back and the recommended readings from. Mr. Hazlitt, you will find Rothbard and Mises and a few others. So, yeah, it's very interesting 'cause you have, he's gotta base it off of something. So
Nicky P: For me, I always think about, oh, this is gonna be the year I read Man, Economy, and State.
And then I'm like, well, I gotta get through Human Action first. And then I think about, and, and then I think about the narrator for Human action. And I go, you know what? I don't think I'm reading either of this here.
Luke Tatum: You know, once you get into it, I know we're so inside baseball at this point, but once you get into it, oh my gosh, I can't think of his names right now.
The narrator, he's great though. Like I've listened to so many hundreds of hours of him, you just have to kind of get over the initial, wow, this is really dry. You, but,
Nicky P: Well, if you listen to the entirety of Human Action, you're getting at least a hundred hours. There's no one pretty darn close. It's just that one book
Rob Brayton: At least.
Luke Tatum: It's, yeah, it's. 80 anyway. I mean, yeah. But I, when I used to deliver flowers a little, slideshow from my past is, you know, scrolling in front of my eyes right now when I used to deliver flowers, that is what I was listening to every econ book I could get my hands on. And the Mises Institute, mises.org, has so many books, free audio books that you can just listen to on there.
So I just kept getting them and that's all I did for years. While I was driving around doing that, so that's when I absorbed all that. I don't have time anymore for audio of that length.
Once You Know, You Know What to Do [15:00]
Rob Brayton: Yeah, I would say like, I think the reason why we tend to arrive at some of these, you know, kind of pulling this back into our episode today, I think one of the reasons why we tend to go in these directions right away, or at least kind of take this approach is because.
It's comes back to that fundamental concept of once you know what's going on, you know what to do. You see it. And, and I think that's the part where it's hard not to get a little frustrated when you see all these types of things happening. So that ain't that being said, we have to say, well, if you're not there.
And you're not quite sure. That's why we're encouraging a lot of these books is for you to go like, get the understanding when you, when you learn and you push yourself to learn a little bit more. Now, we're not saying you gotta go out and, and read some of these thousand page books, but there are ways that you can get, you know, 60%, 80% of the knowledge without having to invest that amount of your time capital into the process.
But definitely do it. It is so worth it because you will see things from a different angle and it gives you a different perspective on how to approach all this different stuff that comes out from the government. You start to see your own money in a different way. You start to see where maybe I don't wanna be participating in some of these ways.
And you start looking for alternatives and, and I think that's what all of us arrived at some point. Like we don't wanna be involved with that stuff because it feels, man, like I'm always being manipulated. So is there a way I can. Not be manipulated. And I think that's really what I think where we're, what kind of got us all to this point right.
In having this conversation.
Incentives Matter [17:00]
Nicky P: So the thing that I've always kinda leaned on is like the basis of like the Austrian view, and, you know, why I only put marginal interest in reading Mises is that it just seemed like a whole bunch of extra examples. To prove the thesis that incentives matter, like the, that the core thesis of that is that these incentives matter, and that means all the incentives, like the economy is way more complicated than anyone could possibly imagine, because the incentives for every person on the planet matter in there.
Very difficult to really suss out what that actually means. It's like you can, it's like in physics, you can always make the equation more and more complicated and get it closer to reality, but at a certain point that becomes untenable. To actually understanding what's going on,
The Fatal Conceit [18:00]
Luke Tatum: Right? Especially in a first pass calculation can get you pretty much where you're trying to go, right?
It's like, okay, well it's basically this. Yeah, you can add more factors, you can get it really, really precise. But it's basically this. And so, you know, key insights from that basis are, number one, you can't put a guy or even a small agency of guys, or even a large agency of guys. In charge of the economy because it doesn't work, right?
You need the, it's the, what is it? The fatal conceit hayek, right? You, it's not possible for a small, tiny, relatively tiny group to decide on behalf of millions and millions of people how the economy should work. The economy is. The collective decisions of all those people, that it's a result, the economy is a result.
You don't get to like dictate it and it worked without,
Nicky P: That's a basis of why communism fails everywhere.
Rob Brayton: Well, and and that's what Hazlitt says so well of you have to look at all the pieces. You have to look at all of it if you make a decision. So you can't simply just. You know, pick and choose a couple of different areas and then, oh yeah, well that's okay.
It just doesn't work. It doesn't operate that way. You must view the whole thing, and that's extremely difficult to do.
Second and Third Order Effects [19:00]
Nicky P: Look at what's going on right now, in particular with the oil situation globally. On the surface, oil affects transportation. But now what are all the second and third order effects of everything that transportation affects just in and of itself?
Like this one little piece of the economy? If you treat it as just the micro piece of the economy, it is. Sure you can paint a picture, but that picture doesn't work. And look until you look at. Literally everything else in the economy that is going to be affected by it, which is everything in the economy.
Why Price Caps Cause Shortages [20:00]
Luke Tatum: Right? Right. Because if you isolate the one thing, you say, oh my gosh, it's a problem. Gas prices are high. What is a good government response to, oh my gosh, these prices are really high. Let's make it illegal to charge more than this. Right? Let's put a ceiling on the price. Why doesn't that work? Because then you run out.
Nicky P: What does, what does?
Luke Tatum: Prices tell you how relatively in demand something is, right compared to the supply. And so if you don't let the price go up. There won't be any gas. It's a shortage of what happens every time.
No Solutions, Only Trade-Offs [21:00]
Nicky P: Well, it's, you were talking about getting, you know, solutions to problems and it's like Thomas Sowell says there are no solutions.
There's only trade-offs. And you know, you, how do you solve the oil problem? Well, you don't, it's just you look at all of the other possible alternatives, how they affect things, and you decide to move the money around in o in other ways. That's all you can do. There's no solution.
Pick a Different Number [21:00]
Luke Tatum: Right? You know, this is, this is great.
We've gone so all over the place, but I guess, I guess the thing that we're trying to do is to try to gird you against just toeing the party line. Somebody you know on your, whether you're pro-Trump or against Trump, like whatever side that you happen to find yourself on, it's easy for somebody to point to a different number.
And say, actually the economy is doing super awesome. Didn't you see that US payrolls rose by 178,000 for March? And it's like, yeah, but they went down 140,000 in February. You know, so it's Take a broader look now it looks bad again. Take a more narrow look. Now it looks good again, right? It's so easy. I think we're all aware of the existence of that book.
How to Lie with Statistics. I haven't read it 'cause I'm not interested in lying to people, but statistics. But you know, it's a thing, right? It's not hard at all. You have
Nicky P: Leave it to the market,
Luke Tatum: But. It's so easy. Just pick a different number. Oh, that one doesn't look too good. Let me just, let me change my frame of reference. Like anybody who's ever looked at a stock market chart, you know, any stock price for any company. Oh, let me just zoom in. Wow. Now I can show you that this stock looks really good and you should buy it.
Let me zoom out. Oh, now it looks bad, right? It's, it takes seconds to manipulate and lie to you and to get you to do something differently based on data. Right? And, and we're supposed to be believe that like the Federal Reserve and all these disinterested bureaucrats that have no self-interest of their own are art.
Just, you know, evaluating the data and they're coordinating all these factors, like the geniuses that they are right to make the economy work the right way. And it's like how many centuries do they have to fail at that before you're gonna ask like. What data, bro, you know?
Nicky P: Right on boys. Well, hopefully, folks, you got something out of today. We are reach, we're reaching the long in the tooth phase of the show. Luke, why don't you tell everybody what we got for 'em if they stayed this long?
Outro and Free Toolkit [24:00]
Luke Tatum: Yeah, absolutely. If you wanna, you know, if you didn't get enough of all this educational material, you know, I don't know how, but if you, if you are not having, you're not finding yourself clicking off the video.
If you're still watching, like obviously you found some value here. We love talking about this stuff. We love teaching this kind of. So that you are not taken advantage of by political pundits, et cetera, et cetera. And so if you want to approach the world from a place of strength and be able to navigate the financial ups and downs using the strategy that we use, we have a toolkit for you.
And all we're asking for is your email address. So head on over to perfectspiralcapital.com/podcast and you're gonna get free copy of my book, as well as. Video courses and all this, but the point, the point is. You're gonna be entering into our community where we are all on the same page and we're all trying to navigate the same things.
So check that out and also go over to Rob's separate YouTube channel, Rob Brayton, PSC, where he's got some great content, discussing some of the strategies that we do in more detail as well. Thanks so much for watching, and we'll see you next time.
