“A Period Of Transition” Into A Great Depression?
Posted March 11, 2025
A Transition Period—Or The Beginning of a New Great Depression?
The global economy is on the edge. Over the past few weeks, market tremors have turned into full-blown convulsions. Trillions of dollars in wealth have vanished. Investors are rattled. Consumers are anxious. And Washington? The Trump administration insists this is all part of a “transition period.”
But a transition to what?
The Everything Bubble Begins to Pop
Just six weeks ago, Macro Watch asked a critical question: “Is The Everything Bubble About To Pop?” The answer now seems undeniable. From stocks to crypto, asset prices are in freefall. The S&P 500 is spiraling downward. The Nasdaq has lost 13% in just a few weeks. The so-called “Magnificent 7” stocks—Apple, Microsoft, Nvidia, and their peers—have been battered. Even Bitcoin, the poster child of speculative excess, has cratered. The carnage is everywhere.
Yet, instead of taking steps to prevent an economic meltdown, the Trump administration is pushing forward with radical policies that could accelerate the crisis. Tariffs on Chinese goods have been raised by an additional 20%, while those on many Canadian and Mexican goods are now 25%. These countries have begun to retaliate with tariffs of their own. Government spending is being slashed. Mass layoffs of federal employees are already underway.
This is not just an economic experiment. It’s a high-stakes gamble with global consequences.
A “Detox Period”—Or an Economic Freefall?
Treasury Secretary Scott Bessent described this economic shift as a necessary “detox period.” According to him, the US must break free from its “addiction” to government spending and return to private-sector-driven growth. But here’s the problem: that “addiction” has been the lifeblood of the US economy for decades.
What happens when the government cuts spending while consumer prices soar due to trade wars? What happens when businesses hesitate to invest in the face of extreme uncertainty? What happens when markets spiral lower and confidence shatters?
We may be about to find out.
Has The Recession Already Begun?
The warning signs are multiplying:
– The Atlanta Fed is now forecasting a 2.4% contraction in US GDP this quarter.
– Consumer confidence is collapsing.
– Retail sales are plunging.
– The bond market is signaling distress.
And yet, the administration appears oblivious to the magnitude of the risk.
What if this isn’t just a transition? What if it’s the start of something far worse?
What Comes Next?
The new Macro Watch video breaks it all down. How bad could things get? What are the key indicators to watch? And most importantly—how will this economic experiment ultimately end?
Subscribe to Macro Watch today to find out.
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This video is 19 minutes long and contains 42 slides that can be downloaded.
To see a list of all the videos in the Macro Watch archive, CLICK HERE.
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