'Nail-biting time': Wall Street economist warns Trump has created worst market uncertainty in 35 years
The Dow plunges more than 500 points in opening trade after Britons vote for Brexit (AFP Photo/Spencer Platt)

According to a report from Politico, Donald Trump's trade war and economic policies have given Wall Street the jitters, with investment house economists predicting stagnation at best and the very real possibility of a recession on the horizon.

Noting, "The United States economy is slowing by nearly every major measure, from job creation to business investment," the report claims that most experts pin a major part of the blame on one culprit: Donald Trump.

Stating a "surge in economic uncertainty" is being driven "to historic levels," the report attributes it to "Trump’s itchy Twitter finger and head-spinning approach to trade and fiscal policy."

With Wall Street traders complaining about wild swings in the market -- largely driven by scattershot administration tariff announcements and presidential attacks on companies that have angered him -- economists are having trouble predicting what comes next.

"Trump-related uncertainty dominates talk among corporate executives on earnings calls and during discussions at the U.S. Federal Reserve. Companies are reining in capital spending and slowing their hiring plans, unsure what the unpredictable president might do next and whether it will help tip the U.S. from slowing growth into recession," Politico reports. "Taken together, the mosaic of data and anecdotes suggests traits that helped drive Trump into the White House — his promises to rip up trade deals and demolish the status quo — could undermine his own economy and imperil his chances for a second term."

According to David Rosenberg, chief economist and strategist at investment firm Gluskin Sheff, economic anxiety on Wall Street has set in and it is the worst he has ever seen in his career.

“I‘ve been in the business for 35 years, and I don’t remember a time where uncertainty was at such an extreme level — and that covers a lot of nail-biting periods,” Rosenberg admitted. “The U.S. economy is going to slow down perceptibly. I would suggest no growth in the fourth quarter. People are going to be surprised by it. It will either be recession or stagnation.”

With Treasury Secretary Steve Mnuchin stating, “I think there’s no question the U.S. economy is in very good shape. As we look around the world, there’s no question that China is slowing, Europe is slowing — the U.S. is the bright spot of the world. And regards to a middle-class tax cut, you know, we’ll be looking at tax cuts 2.0, something that will be something we’ll consider next year. But right now, the economy is in very, very good shape," Politico notes reality tells another story.

"Key data does not support Mnuchin’s argument. In addition to a slower pace of job growth, manufacturing output measured by both the Fed and the Institute for Supply Management show a contracting factory sector slammed by Trump’s trade war with China and concerns that a replacement for the North American Free Trade Agreement negotiated by Trump may not pass Congress this year," the report notes with Politicos' Ben White adding a pithy, "It’s not hard to figure out why companies are growing cautious."

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