Despite recent significant losses on Wall Street, United States President Donald Trump dismissed the likelihood of an impending recession on Tuesday, expressing confidence that the nation's economy is set for a major upswing. "I don't see it at all. I believe this country is going to experience a tremendous boom," Trump stated in response to a press inquiry at the White House during a Tesla car showcase.
His remarks stand in stark contrast to the uncertainty he stoked during a Sunday interview with Fox News, where he sidestepped questions about whether his economic policies—characterized by an aggressive tariff strategy against key trading partners like Canada, Mexico, and China—could lead to a recession. This rhetoric fueled market jitters, leading to a sharp decline on Wall Street on Monday.
Nevertheless, the president downplayed the extent of the downturn that economists had already anticipated, describing it as a "normal movement" within market cycles. "You're going to have declines, and markets are going to go up and down. But, you know what? We need to rebuild our country," he asserted.
Echoing this sentiment, White House Press Secretary Karoline Leavitt told reporters that the stock market drop was merely "a snapshot of a moment in time" and did not accurately reflect the overall state of the economy. She attributed the fluctuations to a "transition" from what she dubbed the "economic nightmare" under President Joe Biden to the "golden age of American manufacturing" championed by Trump.
The comments followed a bleak day for Wall Street's major indices, marking their worst performance since Trump's return to power. The S&P 500 fell by 2.7%, the Nasdaq dropped 4%, and the Dow Jones ended with an 890-point loss, equivalent to a 2.1% decrease. Although Tuesday saw less severe losses, the downward trend persisted: the Dow Jones fell 1.14%, the S&P 500 retreated 0.75%, and the Nasdaq declined 0.18%.
In this context, Trump continues to blame his predecessor, Joe Biden, for the current inflation: "Biden left us with a horrible economy. He left us with terrible inflation, and I think the market was doing very, very badly," he commented.
The president made these remarks while attending a Tesla electric vehicle exhibition on the White House lawns alongside billionaire Elon Musk, who heads the Department of Government Efficiency (DOGE) and has faced a national boycott due to his far-right policies.
During his first term, Trump adjusted his tariff policies following market downturns, but this time he has shown no signs of backing down. Starting Wednesday, he will impose a 25% tariff on steel and aluminum imports from all countries, a move that particularly affects Canada (which he threatened with an even higher 50% tariff on steel and aluminum imports), Mexico, Brazil, Japan, the United Kingdom, and the European Union.
Frequently Asked Questions about U.S. Economic Outlook
Why did Trump dismiss the possibility of a recession?
Trump believes that the U.S. economy is set for a significant boom and views recent market fluctuations as typical within normal market cycles, rather than indicators of an impending recession.
What factors have contributed to market jitters?
Trump's aggressive tariff policies against major trading partners like Canada, Mexico, and China have fueled market uncertainties, leading to significant declines on Wall Street.
How has Trump responded to the recent stock market declines?
Trump has downplayed the recent stock market declines, describing them as normal movements in market cycles and emphasizing the need to rebuild the country.