Trump’s tariffs could usher in a worst-case economic scenario not seen since the 1970s

Jamie Dimon, head of America’s largest bank, JPMorgan Chase — and commonly referred to as the ‘president of Wall Street’ — spent much of this past year warning that there’s an elevated risk that the US experiences 1970s-esque stagflation, which is when economic growth stagnates while inflation heats up.

Jamie Dimon, head of America’s largest bank, JPMorgan Chase — and commonly referred to as the ‘president of Wall Street’ — spent much of this past year warning that there’s an elevated risk that the US experiences 1970s-esque stagflation, which is when economic growth stagnates while inflation heats up. “I look at the amount of fiscal and monetary stimulus that has taken place over the last five years — it has been so extraordinary; how can you tell me it won’t lead to stagflation?” Dimon said at a conference in May. His prediction, however, has been pooh-poohed by many leading economic voices; chief among them was Federal Reserve Chair Jerome Powell, who said at a press conference in May, “I don’t see the stag or the ‘flation.” That, of course, was before President-elect Donald Trump won the election. Now, Americans may have to actually brace for stagflation — something the nation’s economy hasn’t experienced in over half a century. This time around, though, fueled by tariffs. Just over a month from now, Trump will have the power to levy tariffs on other nations at the flick of a pen. And once inaugurated on January 20, he has pledged to immediately impose a 25% tariff on Mexican and Canadian imports and increase tariffs on Chinese goods by an additional 10%. On the campaign trail, he also promised to levy a 10% to 20% tax on all imports and increase tariffs on Chinese goods by at least 60%.