Sir Niall Ferguson

The tax cuts from 2017 are going to be extended.

So it's not all negative, but I think I'm in agreement with the economists at Goldman and Morgan Stanley.

If you do the arithmetic, it's clearly going to be a significant decline in growth this year, possibly recession, though I think that's not the base case.

And so by the end of the year, even more people than currently are will be saying, well,

what do we vote for?

This is more painful than we had been led to expect.

Because of course, if you think back to the first Trump administration, it was actually economically pretty beneficial for the average American household.

That's because Trump didn't go full tariff man.

Trump was very much constrained in his first term on every major policy domain.

But this time, after four years in the wilderness, the MAGA gang have a plan.

And that plan is

to go full tariff man, and also to close the southern border.

And those things will have meaningful costs for American households that they weren't expecting to have to pay when they voted for Trump.

Well, I think we've already seen the way in which even a 10% stock market drawdown sends Scott and Kevin Hasse into the TV studios to reassure markets that actually the tariffs are going to be just a transactional, temporary thing.

I'm not sure Trump is bothered by 10% stock market decline.

I think 20%.

might get his attention.

It did in late 2018.

But then he just piled the pressure on the Fed and said it was on Jay Powell to cut rates.

So I think this second Trump administration is going to be much harder to blow off course, not least because there are a few elements inside the administration that are actually hostile to this agenda at the moment.