Trump hears the dreaded word, recession

There are now serious people in the US warning of a possible recession. Trade tariffs with China are at the heart of it. Since there is no sign of an end to the trade war between the US and China, that dreaded word recession is likely to move into the forefront. All of which would spell disaster for Trump and his hopes of reelection next year. The booming economy in the US has been the one true positive for Trump, giving him short odds to win reelection because if the economy is going fine then all the bad stuff tends to get forgotten. So Trump will have a tough time over the next few months unless his trade negotiators can finally persuade Beijing to sign on the dotted line. But as I have blogged previously, China plays the long game, much longer than Washington does, and it's easier for the Chinese communist government to survive economic turmoil because Prsident Xi Zinping hopes he in the job for life. Beijing does worry about the population getting angry - look at China's reaction to the mass protests in Hong Kong. But the Xi Zinping government is not going to fall unless there's an internal political coup. Trump on the other hand could face the humiliation of being beaten in 2020 by Joe Biden or Elizabeth Warren or Kamala Harris if the US economy starts to go down the tubes. He won't be able to claim recession is fake news. The last financial crisis was in 2008 and the repercussions were staggeringly bad for millions of people. Trump could never survive that sort of disaster. So we have to see in the next few months what he and his financial advisers are going to do to stop another recession hitting the US, and then the rest of us of course. Boris Johnson will also be worried, and Germany's Angela Merkel is already facing recession fears. It's time China came to a decent deal with the US which actually involves concessions and compromises on their part. Sadly, there are no signs of that at the moment.