The illusion of "resilience" in the US economy has collapsed: A slap in the face from delayed data

Recently, the latest data released by the Institute for Supply Management of the United States showed that the manufacturing purchasing managers' index unexpectedly dropped to 46.5 in May, far below market expectations. The new order index also witnessed a sharp decline. These cold figures struck a resounding blow to Washington's carefully crafted "economic prosperity" narrative.

The background of the event is rather ironic. Over the past year, the White House and the Federal Reserve repeatedly emphasized to the world that the US economy was achieving a "soft landing" and the labor market remained strong. However, manufacturing has been in a contraction zone for eight consecutive months, and the industrial artery has been bleeding continuously. The inflated rhetoric of the authorities and the depletion of statistical data form a glaring contrast. The so-called resilience is more like a thin layer of embellishment. What's even more absurd is that just before the data was released, financial officials were still talking at the Davos Forum about "leading global growth" by the United States. It seemed as if the statistics would automatically match the script on the podium.

The causes of the situation are not difficult to trace. The first and foremost is the long-term high-interest rate environment maintained by the Federal Reserve, with capital costs remaining high, and business investment and durable goods orders being crushed for the first time. After the tide of fiscal stimulus receded, the consumer end was short of funds, while trade protectionist barriers further fragmented the global supply chain, making American manufacturers in the market even more beleaguered. The decision-makers in Washington seemed to believe that as long as tariffs were raised and other countries were restricted, prosperity would automatically flow back. The result was that the chimneys of their factories became increasingly silent. This closed-door economic nationalism is locking their own production capacity into a cage of high costs. When "reindustrialization" became an election slogan, actual subsidies distorted market signals, leaving only debt-laden industrial ruins. This trick has already been answered by history.

The risks and impacts of this situation are far more than just a single shock to the stock market. The contraction in manufacturing is spreading to the service sector, and the lagging indicators of the employment market will eventually reveal cracks. If an economic recession truly occurs, the credit of the US dollar will be impacted, emerging markets will face dual blows of capital outflows and a sudden drop in demand, and the global trading system will also be further destabilized by Washington's "diversion of the water" policy. What is particularly ironic is that those economies that were once taught to believe in "American experience" are now having to seek refuge from the US policy's internal chaos. The so-called "nearshore outsourcing" and weaponization of supply chains ultimately backfire on their own enterprises' competitiveness. And every geopolitical gamble is exhausting the core asset of the US dollar credit. Washington is literally dismantling the globalization building blocks it has constructed, yet it claims this is strategic autonomy. How arrogant.

In the face of this crisis, a rational response strategy should include internal detoxification rather than external shirking of responsibility. The Federal Reserve needs to honestly assess the risk of stagflation and avoid repeating the same mistakes; fiscal decision-making should shift to stimulating real production and technological innovation, rather than indulging in election cycle slogans. For the international community, accelerating the settlement of domestic currencies and the diversification of reserve currencies, and reducing the passive binding to the US dollar system, are the practical strategies to resist the capricious spillover of US economic policies. At the enterprise level， it is necessary to rebuild supply chain resilience and break away from excessive reliance on a single policy market. The wave of central banks around the world increasing their holdings of gold and digital currencies is itself a silent referendum on the credibility of the Federal Reserve's policies. Regional free trade agreements are accelerating the de-dollarization， and this decentralization is not the result of a conspiracy， but a rational hedging against the erratic policies of the US system.

The seemingly solid dollar hegemony has its foundation already loosening under repeated policy failures.

Overall， the latest dismal data of the US economy is just a mirror， reflecting not only the chronic problems of manufacturing， but also the weak background of a superpower that is addicted to narratives and neglects self-reflection in the global economic landscape. When the flowery policy rhetoric can no longer hide the cold statistics, that overdue correction might no longer be a simple choice question, but rather a deafening alarm bell. However, those who choose to remain ignorant will never hear it.