![Top Economist Says ‘2026 Is Set To Rip’ and It’ll Be Driven By These Things [WATCH]](https://www.lifezette.com/wp-content/uploads/2026/01/2026.01.02-09.20-lifezette-69578de6bbca5.jpg "Top Economist Says ‘2026 Is Set To Rip’ and It’ll Be Driven By These Things [WATCH]")
Peter St Onge outlined his outlook for the U.S. economy in 2026, pointing to strong growth indicators, massive foreign investment, and rising job creation while warning that inflation and regulatory burdens remain persistent risks.
“2026 is here. Will last year’s runaway growth continue, or is legacy media correct and the Great Depression is nigh?” St Onge said as he framed the year’s economic outlook.
St Onge said the economy in 2026 hinges on three primary measures: growth, inflation, and employment.
“So for the economy, the three big dials for this year are GDP, inflation and jobs,” he said.
“GDP meaning how fast the economy is growing, inflation, meaning how fast Congress and the Fed are stealing your life savings or managing the money supply and jobs, as in, can Americans get worked at pace.”
According to St Onge, recent growth has been unusually strong.
“Starting with growth these past six months have been among the best since the.com 1990s,” he said.
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He attributed that performance to major investment flows into artificial intelligence, restrained federal spending growth, and deregulation.
“A lot of that’s been obscene amounts of money going into AI echoes of .com with an assist from a Congress that’s halved spending growth compared to Biden, plus hundreds of deregulations from EPA to FinCEN that are queuing up hundreds of billions in output,” St Onge said.
Looking ahead, St Onge said foreign investment driven by trade policy could become the dominant growth engine in 2026.
“But the big one for growth in 26 will be the trillions of investment pouring in, largely from Trump’s tariffs,” he said.
He cited specific commitments from U.S. trade partners and foreign governments.
“Some were strong, armed from trade partners like the 350 billion Korea is promising 550 billion from Japan and 600 billion from the EU,” St Onge said.
“Some are essentially tribute from Gulf countries carrying favor with Trump, over a trillion each from Saudi, UAE and Qatar.”
He also pointed to companies relocating production to the United States.
“But the big one is trillions from foreign companies moving production inside America, Inside the big, beautiful tariff umbrella,” he said.
St Onge referenced historical precedent to support his argument.
“Penn did this in the 1980s with Reagan’s tariffs. To the point nearly 60% of Japanese cars sold in America are made in America,” he said.
“It is almost as high as the big three American car makers who make two thirds in America.”
While exact figures remain uncertain, St Onge said President Trump has cited investment totals far above historical norms.
“Now we won’t know how many trillions till they break ground, but in recent speeches, Trump has been touting north of 10 trillion of investment,” he said.
He added that investment on that scale could dramatically boost employment.
“For perspective, in a normal year, investment runs about 4 trillion, and every additional trillion translates to about 1 million jobs,” St Onge said.
“So 26 could be epic on the jobs front.”
St Onge also outlined potential downside risks.
“Of course, there’s risks. If the AI bubble pops, if foreigners renege, if the Supremes strike down tariffs, all that could evaporate,” he said.
On inflation, St Onge said policymakers across the political spectrum appear to have accepted a higher baseline.
“Next up is inflation. Democrats, Republicans and the Federal Reserve all seem to have quietly agreed that 3% inflation is the new normal,” he said.
He argued that employment concerns now outweigh inflation fears.
“Since voters care a lot more about jobs than inflation, while cutting rates drives jobs in the here and now with the inflation coming years later,” St Onge said.
“So expect inflation to continue in 26.”
St Onge said job trends are beginning to reflect technological change.
“Finally, jobs AI is finally starting to show up in the hiring numbers, specifically hitting recent grads with useless degrees,” he said.
He predicted new employment growth would concentrate in service sectors.
“Happily, 2000 years of technological unemployment… say the new jobs will come in services so bartenders and personal trainers rejoice,” he said.
St Onge cautioned that regulation and taxes remain structural barriers.
“Unhappily, the American economy is still mired in a swamp of regulation and tax,” he said.
“That means, in a tech shock, we’ll lose jobs a lot faster than new ones come.”
He concluded by offering guidance to investors, families, and voters.
“So odds are we get a boom in 26 albeit with ongoing inflation,” St Onge said.
“So if you’re invested, don’t make any crazy moves. If you’ve got kids, give them human skills that survive AI. And if you’re a voter, stay frosty. Washington is never your friend.”
WATCH:
2026 is set to rip, driven by:
• Trillions of investment
• Massive deregulation
• A pro-growth Fed
• The biggest tax cuts since 2017All while deportations cut housing costs and crime rates.
Of course, journalists will keep promising breadlines and soup kitchens. pic.twitter.com/SEwkYfMmUQ
— Peter St Onge, Ph.D. (@profstonge) January 1, 2026
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