Tariffs And The Economy

2025-04-11 03:15:00 ET

Summary

• Many economists have changed their forecasts to include a recession for this year, and that could still occur.
• The tariff situation is changing daily and the impacts on the economy are also changing.
• Financial markets certainly reacted positively to the news of the tariff delay, with the DJIA up by more than 3,000 points (+8.0 percent) and the S&P 500 climbing by more than 470 points (+9.5 percent).

By David W. Berson, Ph.D.

We know (and virtually all economists agree) that tariff increases are a supply shock that slows economic activity and increases prices. Does this mean that the U.S. will experience a near-term recession and inflation will move higher? The answer to this depends crucially on how higher tariffs rise and for how long....

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