President Donald Trump warns of a financial crash if he loses re-election, arguing that even voters who personally dislike him should base their ballots on the nation's strong growth and low unemployment.
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But in private, Trump is becoming increasingly concerned that the economy will not look so good. Day.
The financial markets signaled the possibility of a US recession this week, sending a storm of anxiety to investors, companies and consumers. That is at the top of concerns about Trump's plans to impose punitive tariffs on goods from China and words from the UK and Germany that their economies are shrinking.
Although a recession here before is far from certain, a downturn would be a devastating blow for the president, who has made a strong economy his central argument for another period. Trump advisers fear that a weakened economy would hurt him with moderate Republican and independent voters who have been willing to give him a pass on some of his fiery politics and rhetoric. And White House economic advisers see few alternatives to reverse course should the economy start to slide.
Trump has taken to blaming others for the recession, most notably the Federal Reserve, as he pushes for further interest rate cuts. Still, much of the market's uncertainty stems from his own escalation of a trade war with China, as well as weakening economies in key countries around the world.
Some of Trump's closest advisers have urged him to lower the temperature of the trade conflict, fearing that further tariffs would only further hurt American consumers and rattle the markets. The president blinked once this week and delayed a set of tariffs in an attempt to save Christmas sales.
Auxiliaries acknowledge that it is unclear what steps the White House can take to stop a downturn. Trump's tax cut in 201
The hope among administration officials is that a mix of wage gains and consumer spending will bolster growth through 2020. Still, Trump knows his own survival is linked to voters believing that he alone could extend the economy's decades plus expansion.
"You have no choice but to vote for me because the 401 (k), everything is going to be in the pipeline," said the president at a Thursday tournament in New Hampshire. "Whether you love me or hate me, you have to vote for me."
Trump has spent much of the week at his golf club in New Jersey, many of his mornings on the links, afternoons watching cable TV, and his evening calling on confidants and business leaders to grab market volatility.
Although he has voiced private concerns for Wall Street, he is also skeptical of any of the weaker economic indicators, wondering if media and establishment figures are manipulating the data to make him look bad, according to two Republicans near Det White House, not authorized to discuss private conversations.
His skepticism has been compounded by White House officials who have long been inclined to just show Trump's lighter economic reviews.
In the midst of market turmoil this week, the president tweeted defense of his financial record.
He blasted the Fed for not cutting interest rates deeper, believing that sharper cuts would lead to more lending activity and make the US dollar more competitive with foreign currencies. The president also highlighted the power of consumer spending – as retail sales jumped 3.4% from a year ago.
Still, his focus on the Fed may be counterproductive.
The Federal Reserve voted last month to trim prices for the first time since 2008, a step taken to isolate the economy from trade uncertainty. But consumers interpreted it as a pre-regulation before a downturn rather than as part of an effort to keep the economy growing, according to the University of Michigan Consumer Sentiment Survey released Friday.
Consumer confidence has fallen 6.4% since July. Pessimism could be exacerbated if the Fed decides to cut interest rates in line with Trump's wishes.
"Further interest rate cuts will help increase consumer concerns about a potential recession," said Richard Curtin, director of the survey.
One sector that is already suffering this year is the industry, the very industry that Trump promised to revive and strengthen with his tariffs. The factory has fallen 0.5% over the past 12 months, the Fed said Thursday.
There are a few steps the government can take to help with production and the economy, said Linda Dempsey, vice president of international economic affairs at the National Association of Manufacturers.
Congress could approve the updated US, Canada and Mexico trade agreement – which would protect the North American supply chain. Second, the government could renew the charter, which will soon expire for Export-Import Bank. But reconciling the situation with China is difficult because it involves negotiations between two countries with competing interests.
"It requires two sides – it's not something the United States and our own political environment can handle," Dempsey said.
Most economists – including Fed officials – still expect the economy to grow this year, only at a slower pace than last year's 2.9%.
A senior White House official said growth in the second quarter of this year was artificially low due to unusually bad weather and problems at Boeing that damaged aircraft production. Thus, the base economy may be stronger than many forecasters believe.
The financial markets on Wednesday pointed to a possible downturn when interest rates charged on a 10-year US state tax rate fell below interest rates on a 2-year note. This event has traditionally seen a recession. But the Trump official said it may have lost its predictive power because of the low interest rates and other policies of central banks around the world.
But the falling rates on US state taxes indicate that the downturn for recession is now ticking, said Scott Anderson, chief economist at Bank of the West.
The only challenge is figuring out when that alarm clock can ring.
"I think we're heading down the road to recession – we're on the steady march toward the inevitable conclusion," Anderson said. "It's just the drip, drip, drip of trade war anxiety that hangs over the market sentiment."