The answer, more often than not, is a shrug. The United States economy is slowing by nearly every major measure, from job creation to business investment, and a growing consensus among academics, corporate leaders and economists points to one primary driver: a surge in economic uncertainty fueled by President Donald Trump’s unpredictable approach to trade and fiscal policy.
The global Economic Policy Uncertainty Index in June hit its highest level ever recorded, eclipsing periods after the Sept. 11 terrorist attacks and the 2008 financial crisis. Both of those stretches were marked by recessions already underway and employers slashing jobs. Now, Trump-related uncertainty is clouding business forecasts, puzzling investors and potentially threatening the president’s own reelection prospects.
Companies are reining in capital spending and slowing their hiring plans, unsure whether the president’s next move will tip the U.S. from slowing growth into a full recession. The confusion dominates talk at the U.S. Federal Reserve and on corporate earnings calls, where executives cite the whiplash of tariff announcements and policy reversals as a primary obstacle to long-term planning.
David Rosenberg, chief economist and strategist at investment firm Gluskin Sheff, said the current climate is unlike anything he has seen in his 35-year career. “I’ve been in the business for 35 years, and I don’t remember a time where uncertainty was at such an extreme level — and that covers a lot of nail-biting periods,” Rosenberg said. He predicted the U.S. economy will slow perceptibly, adding, “I would suggest no growth in the fourth quarter. People are going to be surprised by it. It will either be recession or stagnation.”
From Campaign Promise to Economic Liability
The traits that helped drive Trump into the White House — his promises to rip up trade deals and demolish the status quo — are now undermining the very economy he has claimed as his signature achievement. The president has insisted publicly that everything is fine, but the mosaic of data and anecdotes suggests otherwise. Some of the current economic growth represents spending by consumers and inventory-building by companies trying to get ahead of pending tariffs, a temporary buffer rather than a sign of durable strength.
Evidence of the confusion and anxiety is piling up across sectors. Business owners report delaying expansion plans and holding off on equipment purchases. Investors are pulling back from sectors most exposed to trade policy, wary of sudden tariff hikes or retaliatory measures from trading partners. The uncertainty, economists warn, is becoming a self-fulfilling drag on growth.
Rosenberg’s grim forecast of stagnation or outright recession in the fourth quarter underscores the stakes. If the uncertainty persists, the president’s own economic record — long his central argument for reelection — could become his greatest vulnerability. For now, the question hanging over the economy is the same one vexing corporate America: what will the president do next?
