Latest news with #JustinWolfers
Yahoo
a day ago
- Business
- Yahoo
Hicks: Grim recessionary facts since erratic U.S. economic policies took hold
In March, I predicted the U.S. economy would enter recession and in April I explained how Indiana would be especially vulnerable to this downturn (see and Unfortunately, I was right. A large tranche of data — both public and private — makes that clear. The tariffs have descended hard upon American businesses and consumers. Estimates of their downstream effects cluster around a $2,400 cost per family by the end of 2025, dropping to $2,000 a year in 2026 and later years as Americans buy fewer goods (see This has led economist Justin Wolfers to quip, "Trump has a pronoun problem. He keeps saying he's imposing tariffs on they/them. But he's actually imposing them on us." (See Consumer sentiment has dropped by more than 10 percentage points since President Trump's inauguration day and labor markets have stalled. Help wanted ads nationally dropped by 21% since Trump's 'Liberation Day' tariff announcements and by 27% here in Indiana. The private sector jobs number from ADP shows job growth effectively stopped in April. These private data tell a rich and consistent story about the economy, but public sector data are more accurate and complete. This requires comment on data integrity and character. U.S. economic data has been the envy of the world since the Great Depression. It is fast, accurate, nonpartisan and profoundly transparent. It is collected by a group of quiet professionals with input from hundreds of organizations and individuals. These data make the U.S. the most trustworthy and reliable destination for foreign investment. Trump fired the director of the Bureau of Labor Statistics on Aug. 1 because he didn't like these data. Trump claimed the data were biased against him. That is false. Trump is afraid of facts and likely to become more fearful as more facts emerge, economic or otherwise. He has good reason to be scared on all counts. The latest federal jobs report indicated that the U.S. economy stalled shortly after tariffs were announced. Overall job creation dropped to near zero, and manufacturing employment declined by 33,000 jobs in just three months. Since the tariffs were announced, Indiana lost 2,600 factory jobs — and that is without the most recent month's data, which have not been released. Factory orders have plummeted to levels not seen since COVID and, before that, the Great Recession. On a scale of self-inflicted economic wounds, this is unparalleled. Formally, recessions are determined by the Business Cycle Dating Committee of the National Bureau of Economic Research, which uses six indicators. Between March and April — when I first said we had walked into a recession — four of these six turned negative. Only employment and industrial production remained (modestly) positive. By the next data release, both of those indicators will be negative. Trump inherited an economy that grew at 2.4% last year. Job creation has slowed dramatically under Trump, from more than 180,000 monthly in 2024 to just 35,000 since the tariffs began. If the BLS continues to deliver honest job numbers, we should expect no job growth until 2026 — if then. Unlike typical recessions, prices are rising because of tariffs, making it harder for the Federal Reserve to cut interest rates to help the economy. So, as we move into fall, we should expect accumulating job losses, higher prices and a Fed hesitant to cut rates when the problem is solely that of bad tariffs, not monetary policy. Trump's criticism of the Fed, like that of the BLS, is at best a transparent effort to deflect blame for the ill effects of his tariff obsession. Another uncommon aspect of this recession is that it is isolated to the U.S. We did this to ourselves by starting a trade war with the rest of the world. No other countries seem especially interested in crashing their own economies. This diminishes the attractiveness of the U.S. as a destination for foreign investment. The situation is worsened by the reasonable suspicion that the Trump administration will deliver fictional economic data. Foreign investors may flee, driving up borrowing costs. So, as the U.S. enters a downturn all alone, with the specter of falsified economic data, we should all expect home mortgages, credit card rates and car loans to be higher in the months and years to come. Capital markets are ruthless toward erratic and bizarre economic policies; and whatever else they might be, Trump's economic policies are erratic and bizarre. Michael J. Hicks is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. This article originally appeared on Muncie Star Press: Hicks: Grim recessionary facts since erratic U.S. economic policies took hold
Indianapolis Star
a day ago
- Business
- Indianapolis Star
Trump's tariffs weakened the economy, so he's lying about the data
In March, I predicted the U.S. economy would enter recession and in April I explained how Indiana would be especially vulnerable to this downturn. Unfortunately, I was right. A large tranche of data — both public and private — makes that clear. Tariffs have descended hard upon American businesses and consumers. Estimates of their downstream effects cluster around a $2,400 cost per family by the end of 2025, dropping to $2,000 a year in 2026 and later years as Americans buy fewer goods. This has led economist Justin Wolfers to quip, "Trump has a pronoun problem. He keeps saying he's imposing tariffs on they/them. But he's actually imposing them on us." Consumer sentiment has dropped by more than 10 percentage points since President Trump's inauguration day and labor markets have stalled. Help wanted ads nationally dropped by 21% since Trump's 'Liberation Day' tariff announcements and by 27% here in Indiana. The private sector jobs number from ADP shows job growth effectively stopped in April. These private data tell a rich and consistent story about the economy, but public sector data are more accurate and complete. This requires comment on data integrity and character. U.S. economic data has been the envy of the world since the Great Depression. It is fast, accurate, nonpartisan and profoundly transparent. It is collected by a group of quiet professionals with input from hundreds of organizations and individuals. These data make the U.S. the most trustworthy and reliable destination for foreign investment. Trump fired the director of the Bureau of Labor Statistics on Aug. 1 because he didn't like these data. Trump claimed the data were biased against him. That is false. Trump is afraid of facts and likely to become more fearful as more facts emerge — economic or otherwise. He has good reason to be scared on all counts. The latest federal jobs report indicated that the U.S. economy stalled shortly after tariffs were announced. Overall job creation dropped to near zero and manufacturing employment declined by 33,000 jobs in just three months. Since the tariffs were announced, Indiana lost 2,600 factory jobs — and that is without the most recent month's data, which have not been released. Factory orders have plummeted to levels not seen since COVID and, before that, the Great Recession. On a scale of self-inflicted economic wounds, this is unparalleled. Hicks: Indiana's college crisis has nothing to do with woke campuses or high costs Formally, recessions are determined by the Business Cycle Dating Committee of the National Bureau of Economic Research, which uses six indicators. Between March and April — when I first said we had walked into a recession — four of these six turned negative. Only employment and industrial production remained (modestly) positive. By the next data release, both of those indicators will be negative. Trump inherited an economy that grew at 2.4% last year. Job creation has slowed dramatically under Trump — from over 180,000 monthly jobs under former President Joe Biden in 2024 to just 35,000 since the tariffs began. If the BLS continues to deliver honest job numbers, we should expect no job growth until 2026 — if then. Unlike typical recessions, prices are rising due to tariffs, making it harder for the Federal Reserve to cut interest rates to help the economy. So, as we move into fall, we should expect accumulating job losses, higher prices and a Fed hesitant to cut rates when the problem is solely that of bad tariffs, not monetary policy. Trump's criticism of the Fed, like that of the BLS, is at best a transparent effort to deflect blame for the ill effects of his tariff obsession. Another uncommon aspect of this recession is that it is isolated to the U.S. We did this to ourselves by starting a trade war with the rest of the world. No other countries seem especially interested in crashing their own economies. Briggs: Steak 'n Shake's MAGA makeover is a desperate bid to save a dying business This diminishes the attractiveness of the U.S. as a destination for foreign investment. The situation is worsened by the reasonable suspicion that the Trump administration will deliver fictional economic data. Foreign investors may flee, driving up borrowing costs. So, as the U.S. enters a downturn all alone, with the specter of falsified economic data, we should all expect home mortgages, credit card rates and car loans to be higher in the months and years to come. Capital markets are ruthless towards erratic and bizarre economic policies— and whatever else they might be, Trump's economic policies are erratic and bizarre.
Yahoo
11-07-2025
- Business
- Yahoo
Economist Cooks Up New Code Word For Trump Tariff Plans, Serves It With A Serious Warning
University of Michigan economics professor Justin Wolfers offered a tongue-in-cheek take on Donald Trump's revived tariff agenda on Thursday when he came up with a new acronym to sum up what he fears could be right around the corner. Appearing on MSNBC's 'Deadline: White House,' Wolfers sarcastically mocked Trump's failure to deliver the trade deals he promised after imposing so-called 'Liberation Day' tariffs on imports from around the world. 'I just think you're being too harsh on this bloke,' Wolfers told host Nicolle Wallace. 'I was a 17-year-old boy once, and prom was coming up, and I told all my mates the phone was ringing off the hook.' But in reality, he said, 'I was huddled alone next to the phone hoping it would eventually ring.' 'There might be some parallels' with Trump's situation right now, Wolfers suggested. Trump's administration had promised '90 deals in 90 days,' Wolfers said. 'Instead, we got two frameworks and an extension to 114 days.' 'People don't seem so worried right now,' he continued, saying people are 'betting on' Trump backing away from his tariffs policy, which has been mockingly described in recent weeks by the acronym TACO, for 'Trump Always Chickens Out.' 'But I worry this is the opposite. I worry this is a bloke who loves tariffs and got talked out of it last time,' said Wolfers, who warned that, just like his teenage self eventually asked someone to prom, Trump may now have 'the courage of his convictions' to go through with his threats. That, said Wolfers, could be summed up in a new acronym: TACQUITO — Trump's Aggressive Commerce Quest (will) Unleash Intense Tariff Orders. Authoritarianism Expert Issues 'Leader Cult Alert' Over Wild Trump Official Clip People Can't Believe Pete Hegseth's Drone Promo Isn't A Parody Lara Trump Declares Trump Has Made History In 1 Key Way And Critics Just Can't Trump Decries Secret Service 'Mistakes' Amid Assassination Attempt As 6 Agents Suspended
Yahoo
19-06-2025
- Business
- Yahoo
Social Security trust fund to run dry in eight years, earlier than expected
The Social Security trust fund is projected to run out in just eight years, depleting earlier than expected. NBC News' Brian Cheung reports more. University of Michigan Economics and Public Policy Professor Justin Wolfers joins Katy Tur to examine why 'too many old and not enough young people" is causing there to be 'not enough money' in the fund.
Yahoo
19-06-2025
- Business
- Yahoo
Economics Professor's X-Rated Take On Trump Trade Move Stuns Nicolle Wallace
An economics professor's X-rated analogy for Donald Trump's latest trade maneuver left MSNBC's Nicolle Wallace temporarily at a loss for words on Wednesday. Trump last week said he'll soon write to foreign countries to set unilateral tariff rates. It comes as the U.S. has so far signed just one of the 90 trade deals that was promised within 90 days of Trump's so-called 'Liberation Day,' when he announced plans to hike tariffs on imports from countries worldwide. University of Michigan's Justin Wolfers told Wallace: 'So, Nicolle, I don't know if I'm allowed to say this on television, but sending a letter is to making a trade deal as masturbation is to sex. You're not really involving the other party at all, and you're not really figuring out the ways to exploit the gains from trade.' 'We didn't need this whole mess,' the economist added. Trump 'didn't need to impose high import taxes on Americans. If all he wanted to do was send people letters, we could have done this 90 days ago.' Wallace appeared momentarily stunned at the NSFW analogy, replying: 'Well, you've left me a little speechless.' She then pointed out that Trump's 'brand' is built on making deals, but that's something he's largely failed at with the current lack of potential trade deals for the U.S. Wolfers agreed. 'I don't like to do 'Trumpology' because I don't know what's going on inside the White House,' he said. 'But what I do know is that if you always made the bet that moving forward on any particular economic agenda would require a little bit of hard work, they repeatedly fail to do it.' The 'real world' concern, he concluded, is the ongoing uncertainty that Trump's chaotic trade policies are creating for businesses nationwide. Watch the interview here: Trump Spells Out A Chilling 'Big Difference' He Sees In Himself Since First Term Trump Rages At Reporter Who Refuses To Stick To 'Positive' Questions Economics Professor Utterly Shreds Trump's Trade Chaos In 5 Seconds Flat
