TrumpWatch, Day 937: Signs of Economic Slowdown in US and Around World

TrumpWatch, Day 937: Signs of Economic Slowdown in US and Around World

Signs of economic slowdown gather in the US and around the world, posing a challenge for Donald Trump’s re-election effort. A reliable predictor of US recessions flashed for the first time since the 2008 Great Recession on Wednesday, sending the US stock market to its worst day of the year. The Dow Jones industrial average fell 800 points, about 3% on the day and almost 7% over the past three weeks. Yesterday’s shock came after an “inverted yield curve”, in which returns on short-term U.S. bonds eclipsed those of long-term bonds. That unusual event points to a loss of confidence in the near-term future of the economy, with the US Government having to pay more for buyers of 2-year rather than 10-year bonds. That sign of investor worry has preceded every recession in the past 50 years. Chris Rupkey, chief financial economist at MUFG Union Bank, told The Washington Post : The stars are aligned across the curve that the economy is headed for a big fall. The yield curves are all crying timber that a recession is almost a reality, and investors are tripping over themselves to get out of the way. The Trump Administration tried to blow a bubble of economic growth with its December 2017 package of $1.5 trillion in tax cuts. The measures contributed to a rise in the stock market, and the US economy added jobs, albeit still at a slower rate than that of the final years of the Obama Administration. But a […]

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