Nobel Prize-winning American economist Paul Krugman analyzed this week whether the 'chaos' brought by Trump 2.0 policies could lead to an economic downturn in the United States. (Background: Morgan Stanley: Trump's inauguration will drive BTC to 'pump 8 weeks' and promise to be friendly to BTC, double Favourable Information on tariff policies) (Background: American economist: Trump's establishment of BTC reserves may become the biggest pump and dump scam in history) American Nobel Prize-winning economist and New York Times columnist Krugman has repeatedly warned about the tariff and immigration policies of the Trump 2.0 administration, which may not necessarily reduce the trade deficit and may instead reignite inflation. Will the chaos of Trump's policies lead the United States into a recession? On February 28, Krugman once again published an article analyzing whether the 'chaos' brought about by Trump's policies could lead to an economic recession in the United States. In the article titled 'Chaos Is Not Good for Business,' Krugman wrote: Earlier this month, Trump announced a 25% tariff on Canada and Mexico, followed by a 30-day suspension. Will they continue the show next week? Yesterday, he insisted that it would indeed be implemented, but will it really happen? No one knows. Trump also threatened to launch a trade war with the European Union, claiming that the EU 'was established to bully the United States.' (In fact, it was established with the support of the United States because we saw it as a force for peace and democracy.) Will he fulfill his threat? No one knows. Legislation currently providing the federal government with the funding it needs to operate will expire on March 14, but it is also unknown whether the Republican Party has enough votes to continue providing this funding. Will the U.S. government face a shutdown crisis? No one knows (although the gambling market predicts that this possibility is quite high). In addition to the possibility of a complete shutdown of the federal government, DOGE is also working hard to lay off a large number of federal employees, including half of the employees of the Social Security Administration (SSA)! Will this weaken the operation of various essential services of the government? No one knows. What is most worrying is that if this is true: insiders in the government seem to be proposing the idea of restructuring U.S. debt through the 'Haihu Protocol', which will force investors holding U.S. Treasury bonds (short-term debt) to exchange them for 100-year bonds. This would effectively constitute a U.S. debt default. Because the entire world financial system relies on the security of U.S. Treasury bonds, and U.S. Treasury bonds are widely accepted as Collateral for many transactions, this move would pose a risk of causing global economic chaos. But has the government seriously considered these consequences? No one knows. Krugman: Uncertainty is because 'Trump is an ignorant megalomaniac' In short, the current policies of the Trump administration in the United States are characterized by a great deal of uncertainty, and these policies have a huge impact on individuals and businesses in the United States. Where does this uncertainty come from? It's simple: the U.S. government is currently under the control of an extremely ignorant, vindictive, and impulsive megalomaniac. And it's not just Musk, Trump has the same characteristics. If you don't believe that they are 'ignorant,' just look at how Trump is hyping the opportunities for the United States to invest in Russia. Leaving aside the risks of doing business in a dictatorship, does Trump realize that he is insulting and threatening the European Union through a trade war, whose GDP is nine times that of Russia? I ask, which business relationship is worth nurturing? If you think I'm exaggerating by calling them megalomaniacs, then look at the AU-generated video shared by Trump on Truth Social about the future of Gaza. The video depicts the war-torn Gaza Strip being rebuilt into a seaside resort, with a shining Trump statue. The uncertainty of Trump's economic policies is detrimental to individuals and businesses in the United States. Krugman warned that the United States is now facing thorough policy uncertainty, making it increasingly unlikely for consumers and businesses to make long-term or even medium-term plans. This is not good for the economy. Imagine you are the CEO of a U.S. company considering a range of potential investments, the profitability of which depends on future federal policies. For example, if the United States adheres to the free trade agreement with Canada and Mexico signed by Trump in 2020, then some factories will be worth building. But if Trump tears up the protocol and imposes high tariffs on our northern and southern borders, these factories are not worth building. Instead, you need to make defensive investments to limit the disruption of business with Mexican and Canadian customers and suppliers. A possible rational approach is to defer large-scale spending, watch and wait until the policy is clearer. Weakening consumer sentiment, economic recession may not necessarily occur Krugman also emphasized that he did not predict an imminent economic recession, although he does not have a good track record in this regard, he still believes that the biggest risk of Trump's economics is the impact of tariffs and the expulsion of illegal immigrants on inflation. He pointed out that consumer and business surveys both show that people's concerns about economic trends are increasing. Two major consumer confidence surveys released by the University of Michigan and the Conference Board show declines. The latest S&P Global Business Survey found that optimism for the coming year fell to its lowest level since December 2022, except for September last year, when uncertainty before the presidential election led to business turmoil. The deterioration of the economic situation in February mainly reflects the increasing uncertainty in the business environment, especially related to federal government policies... Business economists like Neil Dutta have begun to seriously consider the possibility of an economic recession. You should know that these signs will not be reflected in 'hard' economic data soon, including the non-farm employment data for February to be released next week, although there are already signs that consumers have begun to reduce spending, and the impact of businesses cutting investment will not be seen for at least a few months. Although it is still unknown whether Trump 2.0 policies will lead the United States into an economic recession, what can be confirmed is that allowing those who are ignorant and have poor impulse control to manage the government will definitely be detrimental to businesses. Related reports: The number of bankrupt U.S. companies reaches a new high since the financial crisis! Wall Street: Risk of economic recession may trigger a big pullback in U.S. stocks in the first half of the year What will happen if the United States experiences an economic recession next year? Analyst: BTC may fall big dump to $45,000, U.S. stocks plummet 30%... How to judge the U.S. economic recession? Please take these 15 key indicators (Nobel Prize-winning Krugman: Uncertainty such as Trump's megalomania will cause a business disaster) This article was first published on the blockchain media BlockTempo.
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Is the United States entering a decline? Nobel Prize winner Krugman: Trump's arrogance and other uncertainties will cause a business disaster.
Nobel Prize-winning American economist Paul Krugman analyzed this week whether the 'chaos' brought by Trump 2.0 policies could lead to an economic downturn in the United States. (Background: Morgan Stanley: Trump's inauguration will drive BTC to 'pump 8 weeks' and promise to be friendly to BTC, double Favourable Information on tariff policies) (Background: American economist: Trump's establishment of BTC reserves may become the biggest pump and dump scam in history) American Nobel Prize-winning economist and New York Times columnist Krugman has repeatedly warned about the tariff and immigration policies of the Trump 2.0 administration, which may not necessarily reduce the trade deficit and may instead reignite inflation. Will the chaos of Trump's policies lead the United States into a recession? On February 28, Krugman once again published an article analyzing whether the 'chaos' brought about by Trump's policies could lead to an economic recession in the United States. In the article titled 'Chaos Is Not Good for Business,' Krugman wrote: Earlier this month, Trump announced a 25% tariff on Canada and Mexico, followed by a 30-day suspension. Will they continue the show next week? Yesterday, he insisted that it would indeed be implemented, but will it really happen? No one knows. Trump also threatened to launch a trade war with the European Union, claiming that the EU 'was established to bully the United States.' (In fact, it was established with the support of the United States because we saw it as a force for peace and democracy.) Will he fulfill his threat? No one knows. Legislation currently providing the federal government with the funding it needs to operate will expire on March 14, but it is also unknown whether the Republican Party has enough votes to continue providing this funding. Will the U.S. government face a shutdown crisis? No one knows (although the gambling market predicts that this possibility is quite high). In addition to the possibility of a complete shutdown of the federal government, DOGE is also working hard to lay off a large number of federal employees, including half of the employees of the Social Security Administration (SSA)! Will this weaken the operation of various essential services of the government? No one knows. What is most worrying is that if this is true: insiders in the government seem to be proposing the idea of restructuring U.S. debt through the 'Haihu Protocol', which will force investors holding U.S. Treasury bonds (short-term debt) to exchange them for 100-year bonds. This would effectively constitute a U.S. debt default. Because the entire world financial system relies on the security of U.S. Treasury bonds, and U.S. Treasury bonds are widely accepted as Collateral for many transactions, this move would pose a risk of causing global economic chaos. But has the government seriously considered these consequences? No one knows. Krugman: Uncertainty is because 'Trump is an ignorant megalomaniac' In short, the current policies of the Trump administration in the United States are characterized by a great deal of uncertainty, and these policies have a huge impact on individuals and businesses in the United States. Where does this uncertainty come from? It's simple: the U.S. government is currently under the control of an extremely ignorant, vindictive, and impulsive megalomaniac. And it's not just Musk, Trump has the same characteristics. If you don't believe that they are 'ignorant,' just look at how Trump is hyping the opportunities for the United States to invest in Russia. Leaving aside the risks of doing business in a dictatorship, does Trump realize that he is insulting and threatening the European Union through a trade war, whose GDP is nine times that of Russia? I ask, which business relationship is worth nurturing? If you think I'm exaggerating by calling them megalomaniacs, then look at the AU-generated video shared by Trump on Truth Social about the future of Gaza. The video depicts the war-torn Gaza Strip being rebuilt into a seaside resort, with a shining Trump statue. The uncertainty of Trump's economic policies is detrimental to individuals and businesses in the United States. Krugman warned that the United States is now facing thorough policy uncertainty, making it increasingly unlikely for consumers and businesses to make long-term or even medium-term plans. This is not good for the economy. Imagine you are the CEO of a U.S. company considering a range of potential investments, the profitability of which depends on future federal policies. For example, if the United States adheres to the free trade agreement with Canada and Mexico signed by Trump in 2020, then some factories will be worth building. But if Trump tears up the protocol and imposes high tariffs on our northern and southern borders, these factories are not worth building. Instead, you need to make defensive investments to limit the disruption of business with Mexican and Canadian customers and suppliers. A possible rational approach is to defer large-scale spending, watch and wait until the policy is clearer. Weakening consumer sentiment, economic recession may not necessarily occur Krugman also emphasized that he did not predict an imminent economic recession, although he does not have a good track record in this regard, he still believes that the biggest risk of Trump's economics is the impact of tariffs and the expulsion of illegal immigrants on inflation. He pointed out that consumer and business surveys both show that people's concerns about economic trends are increasing. Two major consumer confidence surveys released by the University of Michigan and the Conference Board show declines. The latest S&P Global Business Survey found that optimism for the coming year fell to its lowest level since December 2022, except for September last year, when uncertainty before the presidential election led to business turmoil. The deterioration of the economic situation in February mainly reflects the increasing uncertainty in the business environment, especially related to federal government policies... Business economists like Neil Dutta have begun to seriously consider the possibility of an economic recession. You should know that these signs will not be reflected in 'hard' economic data soon, including the non-farm employment data for February to be released next week, although there are already signs that consumers have begun to reduce spending, and the impact of businesses cutting investment will not be seen for at least a few months. Although it is still unknown whether Trump 2.0 policies will lead the United States into an economic recession, what can be confirmed is that allowing those who are ignorant and have poor impulse control to manage the government will definitely be detrimental to businesses. Related reports: The number of bankrupt U.S. companies reaches a new high since the financial crisis! Wall Street: Risk of economic recession may trigger a big pullback in U.S. stocks in the first half of the year What will happen if the United States experiences an economic recession next year? Analyst: BTC may fall big dump to $45,000, U.S. stocks plummet 30%... How to judge the U.S. economic recession? Please take these 15 key indicators (Nobel Prize-winning Krugman: Uncertainty such as Trump's megalomania will cause a business disaster) This article was first published on the blockchain media BlockTempo.