US Policy Fog Spells Trouble
The recent escalation in US policy uncertainty, marked by trade wars and diplomatic tensions, has cast a pall of doubt over the economic outlook. The market's reaction to these developments has been sharp, with Wall Street recording its deepest loss of the year on Monday, while Treasury yields hit near 5-month lows. The uncertainty is having a direct impact on business decision-making, with firms postponing projects and investments until the coast clears.
- This environment of policy fog is eerily reminiscent of the lead-up to the Great Depression, where economic confidence was eroded by prolonged uncertainty, ultimately leading to a devastating downturn.
- What will be the long-term consequences for US policymakers who have built their careers on navigating these treacherous waters, and how will they respond when faced with such a perfect storm?