FLASH
Shkruar nga Pamfleti
Cracks are forming in the foundation of the economy: Layoffs are rising, hiring is slowing, consumer confidence is eroding, and inflation is rising rapidly. While all of these things would almost certainly have happened if former Vice President Kamala Harris had won the election, the uncertainty created by President Donald Trump's economic policies is exacerbating these problems.
The tariffs – especially the nature of Trump’s dictates – are sowing confusion for businesses, consumers and investors, and they are fueling concerns about inflation at a time when consumer prices have been rising again.
Trump's immigration crackdown threatens key industries, including agriculture, construction and health care, which have been struggling to hire. And deep cuts to federal workers and government aid could hurt the most vulnerable Americans, who are less insulated from rising prices.
Trump has delayed most of his most severe tariff threats after discussions with business leaders who condemned the tariffs as unfairly destructive to their bottom lines and the broader economy. But they are set to take effect on April 2. Trump's policies pose real risks to the strong but shaky economy he inherited.
Trump himself acknowledged in his joint address to Congress last week and in the Oval Office on Friday that the tariffs will cause “a little bit of concern.” In an interview with Fox News Sunday, Trump declined to rule out a recession, saying his economic plan could be painful for some at first.
"I hate to predict things like that. There's a transition period because what we're doing is so big," Trump said.
Stock markets were set to plunge again on Monday after Trump's comments: Stocks have reacted negatively to the tariffs. Stocks are not the same as the economy — but Trump and many consumers often tout the market as a sign of strength. While he has been noticeably quiet on stocks recently, during his first term, Trump routinely touted record-breaking markets as a sign of America's economic prowess.
But recent economic data has shown more than just a minor concern.
Consumer spending unexpectedly fell in January, according to the Commerce Department. Shoppers pulled back much more than economists had expected: Spending fell 0.2% for the month. Adjusted for inflation, it fell 0.5%. These are the biggest monthly declines since February 2021.
Consumers aren't spending as much as they used to as concerns about the economy weigh on their purchasing decisions. Both Target and Walmart said in their most recent earnings reports that tariffs and inflation are causing people to spend less.
Reasons for optimism
Of course, America's economy remains strong and resilient. It is diverse and remains the envy of the rest of the world — especially at a time when industrial powers like Germany are seriously struggling and other economies are facing significantly higher and much more sustained inflation than America's. Concerns about a recession are overblown.
Many of Trump's policies could benefit the economy. Businesses have been clamoring for deregulation and tax cuts, and Trump's campaign promises of no taxes on tips or overtime have proven popular with voters. Cutting wasteful spending has also won considerable favor with a broad swath of Americans, even if the methods used by Elon Musk's DOGE are questionable at best.
But Corporate America loves nothing more than certainty, which is hard to find these days. Consumers like to feel confident that if they spend their dollars, more will come in later checks to replace them — and that their future money will stretch as far as what's currently in their wallets./ CNN
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