Trump Could Start A Trade War With American Allies In Second Term, Warns ‘Dr. Doom’: ‘Greatest Threat To Economies And Markets’

Renowned economist Nouriel Roubini, famously known as “Dr. Doom”, warns that a second term for former President Donald Trump could significantly destabilize the global economy.

What Happened: Roubini, known for his pessimistic forecasts, in an op-ed for Project Syndicate warned that a second term for Trump could further destabilize the global economy.

Roubini, notorious for his gloomy economic predictions, anticipates that Trump’s protectionist trade policies would “become more severe,” leading to a possible trade war with key American allies. This could result in de-dollarization, supply chain disruptions, and various other issues.

“A trade war would reduce growth and increase inflation, making it the largest geopolitical risk that markets should consider in the months ahead,” Roubini stated.

This presents a particular challenge for the U.S., where the economy is already shaky, with GDP growth slowing to 3.2% in the last quarter.

He also warned of the likelihood of stagflation risks under Trump’s presidency, a situation where prices surge while growth remains sluggish. He attributed this to Trump’s skeptic stance on climate change and the potential replacement of Fed Chair Jerome Powell with a “more dovish, pliant figure.”

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The economist also expressed concerns over Trump’s promised tax cuts potentially exacerbating the U.S. debt crisis. Current spending trends indicate the U.S. is accumulating a trillion dollars in debt every 100 days, according to Bank of America’s analysis.

“Trump’s proposed economic-policy agenda is now the greatest threat to economies and markets around the world.”

Why It Matters: Roubini’s concerns add to a growing chorus of warnings about the potential impact of a Trump re-election. Former National Security Adviser John Bolton has outlined a series of alarming events that could occur under a second Trump presidency, while former Republican congressman Adam Kinzinger has warned of the potential erosion of American democracy and the global order.

The potential impact of a Trump re-election has been a topic of concern for several experts and public figures. Trump’s niece, Mary Trump, a clinical psychologist, has also raised concerns about his cognitive abilities, adding to the growing debate about the potential consequences of a second Trump presidency.

This came after the former president emerged victorious in the Super Tuesday contests, setting the stage for a potential rematch with Joe Biden in the upcoming general election. Trump secured the Republican votes in 12 states, including delegate-rich California and Texas, effectively securing his third consecutive presidential nomination. According to Real Clear Politics, at the national level, Trump held 47.5% support, While Biden trailed with 45.3% support.

Photo by Frederic Legrand – COMEO on Shutterstock

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This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.