America on the Verge of Recession: Moody’s Warning Raises Questions for Trump’s Strategy

America on the Verge of Recession: Moody’s chief economist Mark Zandi warns that the US economy is on the verge of recession as inflation, tariffs, and job cuts threaten growth. Will Donald Trump’s policies steer America out of this crisis?

America on the Verge of Recession: America Faces Economic Slowdown

The United States (US economy is once again staring at a possible recession, and the alarm bells are ringing louder after a fresh warning from global rating agency Moody’s. Mark Zandi, the chief economist at Moody’s and one of the experts who accurately predicted the 2008 financial crisis, has said that several US states—contributing nearly one-third of the American GDP—are either already in recession or dangerously close to it.

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While the nation grapples with rising inflation, falling demand, and pressure on jobs, political observers are keenly watching how former President Donald Trump will respond if the downturn deepens.

Moody’s Warning: Recession Threat Real

In an exclusive interview with Newsweek, Zandi explained that the risk of an economic downturn in America will impact the average American in two major ways:

Soaring Prices (Inflation in the US): Everyday essentials, from groceries to transportation, will cost more.

Job Crisis: Industries related to food, goods, and logistics could face massive employment cuts.

Zandi added, “Prices are already rising, and soon the impact will be unavoidable. It will hit Americans directly in their daily purchases.”

America on the Verge of Recession: Tariffs and Trump’s Policy Gamble

As the Moody’s recession warning makes headlines, questions are being raised about the Trump administration’s trade policy. America is currently imposing a 50 percent tariff on India, which critics argue could worsen inflation and affect business profitability.

Analysts believe Trump faces a tough choice—whether to continue his aggressive tariff strategy or to address the mounting economic concerns flagged by Moody’s.

Key Economic Indicators Close to Collapse

Zandi pointed out that the combined data of expenditure, employment, and the US manufacturing sector show the economy is dangerously close to a downturn. Adding to the woes are:

Declining corporate profits due to tariffs.

Instability in the US housing market.

Rising inflation, which could jump from 2.7% to nearly 4% by next year.

America on the Verge of Recession: Regions Hit the Hardest

The Washington Metropolitan region is witnessing the worst effects of the slowdown, largely due to cuts in government jobs. However, Zandi emphasized that the recession-hit states are spread across the country.

He further noted that although southern states still show resilience, their growth momentum is slowing down. On the other hand, California and New York, which together account for 20% of America’s GDP, remain relatively stable. Their performance will play a critical role in preventing a nationwide economic collapse.

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Can Recession Be Averted?

Experts agree that without swift corrective measures, the US economy risks slipping deeper into crisis. The Trump administration will need to balance trade tariffs, inflation control, and job creation to safeguard America’s financial future.

With the 2024 elections around the corner, Trump’s response to this warning could shape not only the economic recovery but also his political fortunes.