President Donald Trump and other senior White House officials have been covering Americans over the past few days due to potential economic slowdowns, and they say they’ll move forward.
Fear fostering potential tariff impacts has slowed the labor market, and indicators pointed to potential negative growth in the first quarter.
“What we’re doing is so big, so there’s a transition period,” Trump said Sunday on the Fox News show “Sunday Morning Futures.” “We’re bringing wealth back to America. That’s a big deal. …It takes a little time, but I think it should be great for us.”
When asked if he thought the recession was imminent, Trump said, “I don’t want to predict that.” He later added, “Look, we’ll be confused, but that’s fine.”
On March 7th, 2025, US President Donald Trump makes a gesture as he boards Marine One while departing the White House on his way to Florida, Washington, DC.
Evelyn Hockstein |Reuters
Comments have been made during the tumultuous market period and are riding a continuous roller coaster in response to the news of the day. The major average skated again on Monday. The recent White House guarantees do little to ease the nerves of the jungle market.
Trump used Wall Street as a continuous barometer of his progress during his first term in office, but he dissuaded him from making it a yardstick this time.
“All I have to do is build a strong country,” he said. “You can’t really see the stock market.”
“Detox period” due to expenditure
A new theme from the administration is that slowing or reversal in growth is a legacy from Trump’s predecessor, Joe Biden, and his stimulation of debt and shortaged fuel supply. Treasury Secretary Scott Bescent is seeking a “rebalance” of the economy away from the massive scale of finance and money.
“As we move from public spending to private spending, there will be some natural adjustments,” Bescent told CNBC on Friday. “We’ve just gotten hooked on the market and the economy, and we’re hooked on this government spending and we’ve had a period of detoxification.”
That adjustment may come sooner than later.
The Atlanta Federal Reserve continues closely with the GDPNOW gauge of incoming economic data. This tracks a 2.4% decline in first quarter growth. If it is supported – this measure could become volatile, especially early in the quarter – it will be negative in three years, and the biggest cut since the Covid pandemic will be made in the first quarter.
In an interview with CNBC on Monday, Kevin Hassett, director of the National Economic Council, called GDPNOW Outlook a “indicator of President Biden’s inheritance” and a “very temporary phenomenon.”
“There are many reasons why we’re so bullish about the economy going forward,” he said. “But certainly there are some blips in the data this quarter, including negative GDPNOW, which is related to both Biden’s inheritance and some timing effects that are happening ahead of tariffs.”
Speaking to NBC’s “Meet the Press” on Sunday, Commerce Secretary Howard Lutnick said: “There’s no recession in America. … If Donald Trump is bringing growth to America, I wouldn’t bet on the recession.”
Worry about work and consumers
One of the big movers in the Fed model is a surge in trade deficits in January to a record $131.4 billion, some of which are the products of the company Jump, stockpiling ahead of gold imports and tariffs.
However, concerns about consumer spending after the January pullback are also rising. Consumer activities account for more than two-thirds of GDP, which increases the source of concern.
At the same time, decent headline pay gains in February of 151,000 hidden some fundamental trouble spots for the economy.
The commonly cited unemployment rate has been fine-tuned to 4.1%, but the so-called real rate, which measures part-time workers and people working, has skyrocketed full-time jobs to 8% since October 2021.
The increase occurred as the rolls of people working part-time for financial reasons increased by 460,000, and the 10% jump has risen to the highest level since May 2021. Most of the movements in this category came from people citing Slack’s work and business conditions. Additionally, the level of reporters in the workplace fell by 1.2 million full-time, with part-timers rising to 610,000.
Jim Paulsen, a former economist and strategist at Wells Fargo and other companies, said that the labour market is approaching a “stopping rate” and that while actual unemployment benefits are consistent with the recession, it is not necessarily his prediction.
The rise “emphasizes the rise in stress in the US job market. It also is another indicator that incites fears of a recession among investors and boosts concerns about the potential bear market.”
Few Wall Street economists are missing. Goldman Sachs, for example, has reduced its GDP outlook to 1.7% from 2025, falling half the points below previous forecasts, and tweaking the odds of a 12-month recession from 15% to just 20%.
Trump administration officials argue that current soft patches, including tariff uncertainty, are part of a broader strategy.
“What we’re doing is that we’re building an incredible foundation,” Trump told the Fox Show.
