Trump Blames Business Setbacks On Incompetency vs Recession He’s Causing (#GotBitcoin?)
President defends trade policies ahead of new round of tariffs set for this weekend. Trump Blames Business Setbacks On Incompetency vs Recession He’s Causing (#GotBitcoin?)
President Trump rejected the notion that his trade policies were having a negative impact on the U.S. economy, instead blaming “badly run and weak companies” for any business setbacks and again urging the Federal Reserve to cut interest rates.
Mr. Trump said Friday that the U.S. doesn’t “have a tariff problem…we have a Fed problem.” He added: “Badly run and weak companies are smartly blaming these small Tariffs instead of themselves for bad management…and who can really blame them for doing that? Excuses!”
The comments on Twitter come as more U.S. businesses and farmers say they are suffering amid the prolonged U.S.-China trade war, ahead of a new round of tariffs set to take effect Sunday.
U.S. household sentiment fell in August from the earlier month amid concerns over a trade war, according to the University of Michigan’s index, released Friday.
The gauge posted its largest monthly drop since December 2012, with about a third of consumers surveyed seeing tariffs as a negative driver, said Richard Curtin, the survey’s chief economist.
“The data indicate that the erosion of consumer confidence due to tariff policies is now well under way,” he said.
Fed officials cut interest rates last month for the first time in a decade, citing risks that included slower global growth, trade-policy uncertainty and muted inflation. Mr. Trump has called for the magnitude of rate cuts typically reserved for a period where the economy is slowing into a recession.
Fed officials have said businesses are increasingly citing trade-policy uncertainty—and not their own cost of capital—as a drag on sales, profits and investment, which is one reason officials are likely to cut interest rates again at their Sept. 17-18 policy meeting.
There are “no recent precedents to guide any policy response to the current situation,“ said Fed Chairman Jerome Powell in a speech last week. While monetary policy is a powerful tool to support economic growth, “it cannot provide a settled rulebook for international trade,” he said.
The trade war is set to escalate this weekend. Mr. Trump, disappointed by what he described as Beijing’s failure to follow through on prior commitments, earlier this month called for tariffs on nearly all of the imports from China not hit by prior rounds of punitive duties. The administration later split the tariffs into two groups, with some products affected starting on Sunday and the rest on Dec. 15. Beijing also plans a new round of tariffs.
Mr. Trump last week said he “hereby” ordered American companies to find alternatives to Chinese operations, including in the U.S. Mr. Trump has broad powers to raise costs for businesses operating internationally and could use emergency powers to crack down on commerce, trade lawyers say, but he can’t unilaterally direct companies where to invest.
On Thursday, Best Buy Co. reported disappointing second-quarter sales and narrowed its revenue forecast for the year, citing the impact of U.S. tariffs on Chinese-made goods. Chief Executive Corie Barry said televisions, smartwatches and headphones will be subject to tariffs set to take effect on Sept. 1. Computing products, mobile phones and gaming consoles will be hit by tariffs planned for Dec. 15, she said.
China’s Ministry of Commerce said Thursday that Beijing and Washington remain “in effective communication” about their continuing trade dispute, adding that the two sides are still discussing whether to proceed with talks previously scheduled for September.
The euro on Friday plunged to a one-month low against the dollar as poor eurozone economic data this week has bolstered the view by some observers that the European Central Bank will cut its benchmark interest rate at its September meeting. Trump Blames Business Setbacks, Trump Blames Business Setbacks