We noted this morning that clothing retailers are expecting a big hit to consumers from the trade war brought on by nitwit "negotiator" Donald "Not Exonerated" Trump. Today, one firm is predicting dire consequences from Trump's brinksmanship:
If the U.S. continues to raise a wall of tariffs on Chinese goods in the coming months and China responds, expect a global recession in three quarters, Morgan Stanley said Monday.
“As we view the risk of further escalation as high, the risks to the global outlook are decidedly skewed to the downside,” Morgan Stanley chief economist Chetan Ahya said.
The firm believes a global recession will come in about nine months if the trade war further escalates through the U.S. raising tariffs to 25% “on all imports from China for 4-6 months,” Ahya said. “We would see the global economy entering recession in three quarters,” he said in a note to investors. (our emphasis)The markets are in a tailspin after China announced the first countermeasure to the new tariffs:
Stocks fell sharply on Monday as China hit back at President Donald Trump's move to accelerate tariffs on China-made goods by allowing the yuan to slip to the lowest levels against the dollar in more than a decade.
The Dow Jones Industrial Average fell 695 points, or 2.6%, to 25,789. The S&P 500, which last week had its worst week of the year, fell 2.62%, and the Nasdaq dropped 3.21%.
The decline Monday was the Dow's biggest single day decline of the year and the most since Dec. 4, 2018, when it fell 799.36 points. (our emphasis)Take time to reflect that we have a dimbulb, narcissistic reality show host who parlayed a false image of business success into fame and power, who is also unqualified in every intellectual, moral and emotional way to run a shoeshine stand, who is now largely responsible for the fate of the biggest economy in the world. For starters.
Is it cocktail hour yet?
