Let's talk about Trump's war pushing the economy off the wall.... - Belle of the Ranch

Well, howdy there Internet people. It's Belle again. So, today we're going to talk about Trump's war pushing the economy off the wall.

The rising gas prices, the instability, the disruptions are taking their toll, and the signs are starting to show in indicators and projections. Let's start with the big one.

Organization for Economic Cooperation and Development forecasts US inflation for 2026 to hit 4.2%. That's more than double the target. It's also concerning because the previous inflation estimate from prior to Trump's war was 2.8%. That's a sharp increase.

The OECD attributes it to both Trump's war and Trump's tariffs and said, "The breadth and duration of the conflict are very uncertain, but a prolonged period of higher energy prices will add market to business costs and raise consumer price inflation with adverse consequences for growth.”

Add into this the Federal Open Market Committee vice chair, Philip Jefferson, which is the committee that controls interest rates, said "The ongoing uncertainty over tariff policy and the recent jump in energy prices, however, complicates, at least in the short term, the picture on both sides of our dual mandate of maximum employment and price stability.” He went on to suggest that creates a “downside risk to the labor market and upside risk to inflation.” If you add low economic growth to that, you have stagflation.

The next meeting of the FOMC is at the end of April. And while the Fed hasn't yet indicated rate hikes, traders have pushed the probability of a rate increase this year to 52%. Mortgage rates are already going up. Not speculation, but actual climbs now. It was up to 6.62% on Thursday.

Remember when Pam Bondi told people the Dow was over 50,000? Well, that was the week of the Dow's high. It was down 10.01% on Friday. That means it's technically in correction territory.

While the average American may not follow these numbers, they feel the shift in the economy and understand the effects of high gas prices. Michigan's survey for consumers reflected those feelings. The index of consumer sentiment is down about 6% for the month and near the historic low. The index of consumer expectations went the wrong way too with people expecting inflation to go up and the economic outlook went down. Current economic conditions fell substantially and dropped 12% year-over-year. That drop really shows how sensitive the average American is to fuel prices.

Consumer sentiment isn't always a great indicator for whether or not consumers pull back on spending. If consumers act on their current sentiment, that will end up giving us reduced economic growth. That's all of the ingredients for stagflation. Between his tariffs and his war driving up costs, Trump has taken the US economy to the brink.

Anyway, it's just a thought. Y'all have a good day.