Bofferbrauer2 said:
And with the US economy crashing down (GDP growth went from 2.5% to -2.7% within a month or so) due to Trump's policies and DOGE's actions, the US are now not in the best position anymore. They were beating the European economy mostly due to the greenback (as in, the US can print almost as much money as they want without devaluating their currency because it's the reserve currency of the world, and as a result, spend much more to support the economy without having to resort to borrowing), but Trump's policies have destroyed this advantage within just a couple weeks. I'm sure he'll blame it all on Biden and say that he inherited the crash/recession from him. |
Just to be clear, GDP growth did not drop from 2.5% to -2.7%. The -2.7% figure came from a projection from the Atlanta Fed, which a lot of economists have issues with. Other GDP projections exist over a wide range so we will have to wait a while until we see the actual data.
In my opinion, the main takeaway here is that there is a lot of uncertainty and chaos right now. Things could go a lot of different ways. We just saw today Trump roll back roughly half of his tariffs on Mexico and Canada. Tomorrow he could change his mind. No matter where we settle though, chaos and uncertainty are the enemies of investment. It is hard to make a decision with billions of dollars when you don't know what the economic situation will be in a week, not to mention in a couple years. That is a lot of what we are seeing in the markets right now, with them moving around pretty violently with every new piece of information.
I don't think anyone can really predict where we will land, because I don't think anyone can predict what is going to happen next. It is entirely possible that the effect on GDP and employment over the next few months will be fairly minimal, but I think the long-term harm is going to be significant.
Essay Pro