Banker predicts consumers will drive economic growth
OCEAN CITY — More money in consumers’ pockets from tax cuts, less withholdings and low gas prices will offset geopolitical uncertainty, an escalating federal deficit and stubborn inflation for a strong economy in 2026.
That’s what Greg Matuson, president and CEO of Sturdy Savings, predicted in his 2026 economic forecast with the Ocean City Regional Chamber of Commerce on Jan. 22 at the historic Flanders Hotel.
Matuson started with a broad view, explaining how geopolitical affairs affect the economy, then sharpened his focus to national, regional and local conditions.
He said a year into President Donald Trump’s second term, Israel’s wars in Gaza and with Iran have de-escalated but fighting continues in Ukraine, where Russia has been waging a territorial conflict for years.
Adding to that are the U.S. takeover of Venezuela, a conflict with Iran in the Middle East and discussion of absorbing Greenland into the union.
“There’s gonna be periods of uncertainty throughout this year, and probably throughout the rest of the administration, so just keep that in mind,” Matuson said.
Trump’s imposition of higher tariffs last year has been paying off, with revenue jumping from about $7 billion in April and May to more than $30 billion by the end of 2025.
Matuson said the cost of the tariffs is being borne by wholesalers, importers and, to a much lesser extent, consumers.
“The administration was very clear about tariffs; he didn’t want them to be passed on to consumers. I think, in large part, that’s been relatively successful.”
More money
for consumers
Matuson said politically, the midterm elections in 2026 could have an effect on the economy. However, he said the larger factor is that Americans will start seeing the benefits of last year’s spending bill, which he called a stimulus to the economy.
“Refunds are going to be larger, withholdings are less starting this year. There’s a lot of stimulus in this,” he said.
Matuson called it comprehensive federal spending legislation that extends and expands key provisions affecting households and employers.
“It was designed to support growth, labor participation and domestic investment,” Matuson said. “So this is going to really sort of supercharge things going into 2026.
– STORY and PHOTO by CRAIG D. SCHENCK/Sentinel staff