President Donald Trump’s chaotic trade policies have raised concerns about the potential for a recession in the United States. The stock market has taken a significant hit, erasing six months of gains in just three weeks. Economic indicators are showing signs of weakness, and many experts point to Trump’s tariff obsession as the main culprit.
The markets have made it clear that they strongly dislike Trump’s tariffs. The uncertainty surrounding his next moves is driving fear among investors and making business planning extremely difficult. While the economy Trump inherited from Joe Biden was generally in good shape, it had some lingering issues, such as high interest rates due to inflation, fluctuating GDP growth, and concerns in the tech sector.
Consumer confidence saw a steep decline in late February, primarily due to tariff concerns. The markets reacted even more dramatically, with stocks falling consistently since February 21. If this trend continues, it could spell trouble for the economy.
Broader economic indicators suggest some weakening, though not yet a disaster.
Tariffs ignite economic uncertainty
February job numbers showed signs of strain, and GDP growth estimates for the current quarter have been downgraded from 2.4 percent to 1.7 percent.
However, the consumer price index (CPI) data for February remained relatively stable, despite the looming threat of tariffs pushing prices higher. Trump’s advisers and economic brain trust, including Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent, have called his tariff policy “fluid” and noted progress with foreign countries on key disputes. However, just when progress seems imminent, Trump doubles down on tariffs.
Wall Street, corporate America, and consumers are growing weary of the routine. Art Hogan, chief market strategist at B. Riley Wealth Management, said, “Investors are concerned this will become an own-goal, manufactured economic slowdown.
We don’t know what the endgame is.”
Higher prices could seriously harm America’s economy, which is ironic for a president elected partly because of concerns over an inflation crisis. Scott Lincicome, vice president of general economics at the Cato Institute’s Stiefel Trade Policy Center, commented, “For anyone who voted for Donald Trump on his promise to lower prices, it’s going to be a shock and potentially infuriating that prices haven’t gone down – and instead, they’ve gone up. I don’t see an economic or political way out of this.”
Trump’s aides have downplayed recession fears, suggesting that new tariffs will cause temporary “disruption” as global trade realigns toward the United States.
However, the reality is that Trump has attached himself to tariffs, and unless they go away, the only way inflation may drop is if the economy tips into a recession.
Photo by; Christian Lue on Unsplash
