JPMorgan Chase has issued a warning about the economic impact of the presidential election.
In a new interview with Bloomberg, JPMorgan Chief Global Strategist David Kelly said: target Former President Trump interest Raising tariffs on imported goods to reduce income taxes.
Kelly said if Trump beat Biden and dramatically raised tariffs, the former president would be guilty of causing stagflation.
“What happened [in the debate] The odds of a Republican victory in November are greatly increased…
“If we take Donald Trump at his word, tariffs will go up substantially if they win in a landslide victory. Tariffs are the antidote to stagflation. They slow growth and raise inflation at the same time.”
Kelly said the economy is weak so a policy shock could trigger a recession, pointing to President Trump’s approach to immigration as another potential drag.
“If you take him at his word on immigration, the immigration issue will stop, by deporting undocumented and illegal immigrants. But I’m not sure we should take him at his word. History would make it foolish to take him at his word on this issue. But it’s something to think about, which is that some policy shock could certainly put this economy into a recession.”
Kelly also noted that the future of President Trump’s 2017 tax cuts is a big question mark for the economy.
“Regarding the 2017 tax cuts, if Joe Biden is re-elected, some of the tax cuts will be extended beyond 2025, but not all of them.
“If Donald Trump is elected, I expect all of this will come to fruition. And if you add that to what the CBO is already looking at on growth and debt, by the early 2030s we’ll be at about 135% of GDP instead of 122%. So extending all those tax cuts could mean a lot more debt, which means higher long-term interest rates.”
Kelly did not provide specifics about his economic outlook for Biden’s second term.
In April, JPMorgan Chase CEO Jamie Dimon Said He believes Biden’s current economic policies are “partially working.”
“When you spend that amount of money, growth happens. Some of it was necessary, like industrial policy. I think the infrastructure effort is great. It was a bipartisan effort.”
Among the American people [Biden’s infrastructure spending] “What are they getting? I think when you go to rural America or urban America, you don’t feel like you’re being kept afloat by this economy.”
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