‘We have not seen this rosy picture’: ADP’s chief economist warns the real economy is pretty different from Wall Street’s bullish outlook

For all the volatility 2025 has endured, things have actually turned out relatively well: The S&P 500 is up by more than 17%, inflation hasn’t spiked despite an onslaught of tariffs, and the unemployment rate has stayed fairly steady. Analysts and investors are generally feeling positive about 2026 as a result—after all, the U.S. economy’s performance has been above expectations since the pandemic, so why not take a bullish stance in the face of huge fiscal stimulus? Well, beneath the relatively robust macroeconomic picture, cracks are beginning to show. Those tremors are already being felt; just look at the Fed’s decision to cut the base rate yesterday despite arguments that, under normal circumstances, there would be no particular reason to. Markets expected the cut based on the labor ou