Trump’s Tariffs Stir Fears of Recession and Economic Uncertainty
Former President Donald Trump's recent proposal to impose new tariffs on imports has sparked widespread concern about the potential for a U.S. recession. Analysts from Fortune, The Guardian, Forbes, and The New York Times have all weighed in on the potential economic fallout, suggesting that these tariffs could lead to increased inflation, higher unemployment rates, and a possible bear market.
According to Fortune, the tariffs could push the U.S. economy into stagflation, a situation characterized by stagnant economic growth and high inflation. The Guardian reports that these policies could usher in an era of economic uncertainty, with businesses and consumers alike feeling the pinch. Forbes contributor Bill Stone argues that the tariffs make a recession and a bear market almost inevitable, citing historical precedents where similar policies led to economic downturns.
The New York Times live coverage of the stock market's reaction to the tariff announcement showed immediate volatility, with investors reacting nervously to the potential economic implications. As the debate over these tariffs continues, the economic future of the United States remains a topic of intense scrutiny and concern.
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What do tariffs mean in economics?
An economist answers: 'What is a tariff?' 'A tariff essentially is very much like a tax on a particular good,' says Professor Erasmus Kersting, chair of the Villanova University economics department. Kersting says these tariffs will lead to higher prices.
How is the US economy?
The state of the U.S. economy is strong despite inflation remaining elevated. The economy is expanding at a crisp pace, the labor market is loosening slightly and inflation is slowing from its peak.
What is the US reciprocal tariff rate?
President Trump said this afternoon the US will begin collecting a 10% universal tariff on all imports starting April 5. The 10% rates will be replaced by higher “reciprocal” tariffs of between 11% and 50% on products from 60 countries starting April 9.
What would a recession do?
A recession is officially judged as two consecutive quarters of negative economic growth. During this period, which can last anywhere from months to even years, unemployment tends to rise quickly and retail sales fall sharply. Recessions are a natural part of how an economy works as it expands and contracts1.
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