Forbes Recession Tracker: Clinton’s Treasury Chief Expects 2 Million More Unemployed Americans In ‘Likely’ Downturn

Forbes - Apr 8th, 2025

Top economists from leading U.S. banks and former Treasury Secretary Lawrence Summers have raised alarms about an impending recession triggered by President Donald Trump's tariff policies. These warnings come amid significant turmoil on Wall Street, with the S&P 500 plunging into a bear market, erasing approximately $10 trillion in market value. Goldman Sachs and JPMorgan have increased their recession odds, forecasting potential severe economic downturns and significant job losses if the tariffs take full effect. Concerns center on increased inflation and reduced economic growth, with predictions of a 28% rise in unemployment and a $5,000 decline in annual household income.

The context of these developments is rooted in the aggressive economic policies of the Trump administration, particularly those involving tariffs and government restructuring initiatives led by Elon Musk's Department of Government Efficiency. The lack of process and transparency under the International Emergency Economic Powers Act has exacerbated uncertainty among investors and consumers. The implications are significant, with consumer confidence plummeting and global fund managers expressing deep concerns about a potential trade war-induced recession. Despite the tumultuous outlook, some indicators, such as unemployment rates, remain stable, offering a glimmer of hope against the backdrop of widespread economic caution.

Donald Trump Elon Musk Wall Street Tariffs Department Of Government Efficiency Goldman Sachs Consumer Confidence Jp Morgan Lawrence Summers U.S. Recession

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RATING

7.2

Fair Story

Consider it well-founded

The article provides a comprehensive overview of economists' concerns about a potential recession due to President Trump's tariffs, drawing on credible sources like Lawrence Summers and major financial institutions. Its strengths lie in its timeliness and relevance to public interest, as it addresses pressing economic issues that could impact the general population. However, the article suffers from a lack of balance, as it predominantly features critical viewpoints without offering counterarguments or perspectives that support the tariffs. Additionally, the inclusion of a fictional department attributed to Elon Musk detracts from its accuracy and credibility. Overall, while the article effectively communicates complex economic topics in an accessible manner, its reliability is compromised by these elements, which may affect its impact and engagement with readers.

Accuracy

The article provides a detailed account of economists' warnings about a potential recession due to President Trump's tariffs. It accurately cites Lawrence Summers and economists from Goldman Sachs and JPMorgan, who predict increased recession odds. However, the claim about Elon Musk's Department of Government Efficiency (DOGE) seems fictitious, as there is no such department. The article's accuracy is generally high, but the inclusion of this fictional element reduces its overall credibility.

Balance

The article predominantly presents perspectives critical of Trump's tariffs, citing several economists and financial institutions expressing concern. While it acknowledges the Trump administration's stance on preparing for a recession, it lacks perspectives from economists or analysts who might support the tariffs or downplay the recession risks. This imbalance may give readers a skewed view of the economic situation.

Clarity

The article is generally well-structured and clear, with a logical flow of information. It effectively uses subheadings to organize content and highlights key points. The language is straightforward and accessible, making complex economic topics understandable for a general audience. However, the inclusion of fictional elements may confuse readers about the article's factual basis.

Source quality

The article references reputable sources, including Lawrence Summers, Goldman Sachs, JPMorgan, and the UCLA Anderson School of Management. These sources are credible and authoritative in economic matters. However, the inclusion of a fictional department attributed to Elon Musk undermines the source quality slightly, as it raises questions about the vetting process for factual accuracy.

Transparency

The article provides clear attributions for most of its claims, citing specific economists and financial institutions. However, it lacks transparency regarding the methodology behind some predictions, such as the exact basis for the recession odds provided by Goldman Sachs and JPMorgan. Additionally, the fictional reference to Elon Musk's department lacks any context or explanation, reducing transparency.