JPMorgan raises risk of recession to 60% as Trump tariff turmoil upends markets worldwide

New York Post - Apr 4th, 2025

JPMorgan has increased its estimate of the likelihood of a US recession to 60%, attributing this rise to President Donald Trump's aggressive tariff plans, which have impacted global markets. Jamie Dimon, CEO of JPMorgan, leads the bank, which initially predicted a 40% chance before Trump's recent announcement. The tariffs, unveiled as part of Trump's 'Liberation Day' declaration, impose a 10% baseline on most US imports, with higher rates for countries like Vietnam, China, the European Union, and Japan. JPMorgan's chief economist, Bruce Kasman, characterized these tariffs as a significant functional tax increase on US households and businesses, raising the average tax rate considerably. The bank warns that sustained US trade policies could lead to a recession within the year, impacting both the US and global economies.

The broader implications of these tariffs have caused significant concern across financial markets, with US stocks experiencing a downturn despite previous post-election optimism. Economic analysts, including those from Goldman Sachs, Barclays, and Deutsche Bank, have also raised alarm over potential recession risks, citing weakened economic fundamentals and declining consumer confidence. Trump's tariff strategy, designed to counter perceived unfair trade practices, is feared to hinder economic growth, spark inflation, and increase unemployment. The situation underscores the profound effect of US trade policies on both the domestic and international economic landscape, with significant apprehension about future economic stability.

Donald Trump Tariffs Us Economy Trade Policy Global Markets Jp Morgan Recession Bruce Kasman

Story submitted by Fairstory

RATING

6.6

Fair Story

Consider it well-founded

The article provides a timely and relevant analysis of the potential economic impacts of President Trump's tariff policies, drawing on credible sources like JPMorgan and Goldman Sachs. While it effectively highlights concerns about a potential recession, it lacks balance by not including perspectives from supporters of the tariffs or government officials. The clarity and readability could be improved by simplifying complex economic concepts for a wider audience. Overall, the article serves as a useful resource for understanding current economic debates but could benefit from a more comprehensive and balanced approach.

Accuracy

The article presents factual claims that are mostly accurate, such as JPMorgan increasing the likelihood of a recession to 60% and the specific tariff rates announced by Trump. However, it lacks precise details needed for full verification, such as confirmation of JPMorgan's previous recession probability and the exact historical context of the tax hike comparison. The story accurately reflects the concerns of financial analysts, but the claim about tariffs being the largest tax hike since WWII requires further substantiation.

Balance

The article predominantly focuses on the negative economic impacts of Trump's tariff policies, as highlighted by JPMorgan and other financial institutions. It lacks input from government officials or supporters of the tariffs, which could provide a more balanced view. The emphasis is on the potential recession and market fears, with limited exploration of the administration's rationale or potential benefits of the tariffs.

Clarity

The article is generally clear, with a logical flow of information. It effectively communicates the main points regarding the potential economic impact of the tariffs. However, some complex economic terms and concepts, such as 'functional tax increase,' could be better explained for a general audience. The tone is neutral, but the presentation could be more engaging.

Source quality

The article cites reputable financial institutions like JPMorgan and Goldman Sachs, lending credibility to its claims. These sources are authoritative in economic forecasting, enhancing the reliability of the information. However, the article could benefit from a broader range of sources, including economists or analysts with differing views, to provide a more comprehensive perspective.

Transparency

The article provides limited context on how JPMorgan and Goldman Sachs arrived at their recession probabilities. It lacks detailed explanations of the methodologies used in their analyses. Additionally, the article does not disclose any potential conflicts of interest or biases from the financial institutions, which could affect the impartiality of the claims.