U.S. Economy bracing for potential growth under Trump's administration, yet warned of initial possibility of economic downturn.
Here's a refreshed take on the news:
Donald Trump, in a recent video, promised that his political decisions would rejuvenate the US economy. However, it appears the opposite may be happening, as the GDP contracted in Q1 2025, according to data published on Wednesday. In an interview with NBC, he stated, "It's a transition period, and I think it's going to go really well".
American farmers are feeling the pinch from Trump's policies, as experts warn of a potential economic downturn. Despite this, Trump remains optimistic and told NBC, "I think we're going to have the greatest economy in the history of our country. I think we're going to see the greatest economic boom in history".
Trump's trade war, instigated by imposing hefty tariffs on numerous nations, initially sent Wall Street's stocks plummeting. Yet, markets managed to recover on Friday, buoyed by unexpectedly positive job figures.
The economic slowdown under Trump's policies is cause for concern. The Commerce Department reported a 0.3% decline in GDP for Q1 2025, the lowest growth rate in three years. This contraction signals a troubling trend, with economists predicting a sluggish full-year growth of merely 1.9% in 2025.
Experts also point to the uncertainty surrounding Trump's trade policies as a major threat, stifling business expansion plans and causing an "existential crisis" for many businesses. Trump's tariffs could potentially reduce long-run GDP by 6% and wages by 5%, with middle-income households facing lifetime losses of around $22,000, according to the Penn Wharton Budget Model (PWBM).
While the tariffs may generate significant revenue for the federal government, averaging $4.5–$5.2 trillion over a decade, the economic damage may outweigh the benefits, especially since corporate tax hikes are already considered highly distortive. It's clear that the disconnect between Trump's policy rhetoric and the US's macroeconomic realities continues to widen.
- The economic contractions under President Donald Trump's policies, as evident in the 0.3% decline in GDP for Q1 2025, have raised concerns about a potential recession.
- The ongoing trade war initiated by Donald Trump's imposition of tariffs on various nations has been a major source of economic uncertainty, hindering business expansion plans and posing an existential crisis for many businesses.
- While the tariffs may generate substantial revenue for the federal government, potential economic damages may outweigh the benefits, especially considering that corporate tax hikes are already deemed highly distortive.
- In the face of economic slowdown and potential recession, experts warn that Trump's tariffs could potentially reduce long-run GDP by 6% and wages by 5%, with middle-income households facing lifetime losses of around $22,000, according to the Penn Wharton Budget Model (PWBM).
- Despite the economic challenges evident in the general-news, President Donald Trump remains optimistic, stating that he believes the US economy will experience the greatest economic boom in history.
