Economic Storm Brewing: Yellen’s Dire Warning on Trump’s Trade Policies

Janet Yellen, former Secretary of the Treasury and Chair of the Federal Reserve, has made a strong statement about the growing chances of a U.S. recession. At an economic forum today, Yellen referred to the trade and economic policies of the Trump administration as "the worst self-inflicted wound by an administration on a well-functioning economy." Her comments come as worries grow that escalating tariffs and wild fluctuations in global markets could lead to a recession.

 

Yellen denounced as "disastrous" President Donald Trump's deflationary and inflationary tariff hikes which are at 125% on China. Yellen explained that they are harmful to world markets, and "eroding investor confidence." The U.S. Treasury market has been thrown into chaos, benchmark yields aftermarket equities have fallen sharply. Economists believe there may be a recession, as Washington and Beijing adopting an incautious form of economic brinkmanship.

 

The former Treasury Secretary discussed the harm the administration's policies are causing American businesses and households. "This tariff is the largest tax increase on the American people ever," Yellen said, referring to the tariffs' inflationary nature and negatively impacting consumer spending in the economy and state budgets.

 

Yellen's comments emphasize that the economic fears of the future are based on unreliable and uncertain trade policies, which, in combination with the administration's inadequate fiscal policies for inflation, is an emerging pattern of downturn. These remarks could also be read as urging the Federal Reserve to take initiatives to avoid the consequences of economic policy before more damage occurs.

 

Source: Reuters