Odaily News For the past year, U.S. economic policymakers have focused on achieving a so-called "soft landing," or lowering inflation without a recession. Now, policymakers are considering a course correction that, by their own admission, could put the economy on track for a hard landing. In recent days, President Donald Trump and his top advisers have sounded nonchalant about the rising risk that trade uncertainty will dampen private sector investment. They argue that a "detox" may be needed in terms of spending and hiring, that falling stock values are not worrisome, and that inflation could rise in the short term.
To be sure, Trump took over with steady U.S. growth and a surging stock market, but there are also vulnerabilities from a stagnant housing sector and a cooling labor market. Investors shrugged off those flaws early this year as they expected the new administration to focus on reviving growth. Stocks surged after Trump’s election in November as investors anticipated a bullish stimulus from tax cuts and deregulation, as they did in 2017, his first year as president. “People could only see the good side of what Trump promised,” said Dario Perkins, an economist at GlobalData TS Lombard in London. “But that’s largely gone up in smoke, and now we’re back to a recession observation period.” (Jin Shi)