President Donald Trump’s tariff salvos have deeply rattled a stock market previously bullish about his supposedly pro-growth agenda. With recession fears mounting, a widely respected economist at Goldman Sachs has decided to downgrade the entire U.S. economy.
No longer looking toward share prices for signs of success and approval, the president and his economic officials have signaled they will look past short-term pain in their bid to reshape America’s finances. On Tuesday, Goldman chief economist Jan Hatzius revealed the storied investment bank forecasts U.S. GDP growth to come in below Wall Street’s consensus for the first time in 2½ years.
Goldman’s GDP projection for 2025 now sits at 1.7%, down from 2.4% at the start of the year. That’s because the firm now sees the average U.S. tariff rate rising by 10 basis points this year, twice Goldman’s previous forecast and about five times as high as the increase during Trump’s first term.
Disappointing economic data over the past few weeks did not prompt the new projection, said Hatzius, who gained renown for his bearish forecasts prior to the onset of the great financial crisis in 2007.
“Instead, the reason for the downgrade is that our trade policy assumptions have become considerably more adverse, and the administration is managing expectations towards tariff-induced near-term economic weakness,” he wrote Tuesday in a note to clients.
Members of the starry eyed “Trump is awesome” set have awakened as well:
President Trump’s stop-and-start trade policy and uneven economic messaging have rattled some of his own allies, triggering a flood of calls from business executives, concerns from Republican lawmakers and tension in the White House.
Senior officials, including White House chief of staff Susie Wiles, have received panicked calls from chief executives and lobbyists, who have urged the administration to calm jittery markets by outlining a more predictable tariff agenda, according to people familiar with the discussions. Many in the business community have abandoned efforts to get the president to reverse course on trade, instead pleading with the White House for clarity on his approach, the people said.
In a meeting Monday in the White House’s Roosevelt Room, the president and his top advisers huddled with the chief executive officers of International Business Machines, Qualcomm, HP and other tech companies. Some of the CEOs voiced their concerns about Trump’s tariffs, warning that they could hurt their industry, according to a person who attended the meeting. Trump told reporters that attendees at the meeting talked about investing in the U.S.
I just love this:
The mixed messages from the president and his advisers have raised concerns among some Republicans that Trump lacks a cohesive economic plan.
Ya think?
I guess these people, mostly men, were so excited about being allowed to say pussy at the office again that they couldn’t hear anything else he said, or didn’t say, during the campaign. Well, at least they’re getting some tax cuts. At some point. Right?