Leading economist issues stark recession warning for struggling US economy

[mystery-ak]

 Published August 6, 2025 8:00am EDT
Leading economist issues stark recession warning for struggling US economy
Mark Zandi cites weak jobs data and rising inflation as Fed faces limited rescue options

By Eric Revell FOXBusiness

A leading economist is warning that the U.S. economy is on the brink of recession after incoming economic data last week signaled labor market conditions are softening as inflation is rising, which could complicate the ability of the Federal Reserve to support the economy.

Mark Zandi, chief economist at Moody's Analytics, on Monday wrote a post on X that the "economy is on the precipice of recession" – citing the weaker-than-expected jobs report released Friday and the inflation data from the previous day that showed consumer prices rose as indicating the economy's precarious position.

"Consumer spending has flatlined, construction and manufacturing are contracting, and employment is set to fall. And with inflation on the rise, it is tough for the Fed to come to the rescue," he wrote.

Zandi explained that while the unemployment rate has remained relatively low, that's because "labor force growth has gone sideways" with the number of foreign-born workers declining along with the labor force participation rate.

He also said the "economy-wide hiring freeze, particularly for recent graduates, and the decline in hours worked," is telling about the conditions in the labor market.

Zandi said the tariffs put in place by the Trump administration are having a greater impact on household budgets and corporate profits, while the immigration crackdown has hampered the labor market.

"It's no mystery why the economy is struggling; blame increasing U.S. tariffs and highly restrictive immigration policy. The tariffs are cutting increasingly deeply into the profits of American companies and the purchasing power of American households. Fewer immigrant workers means a smaller economy," Zandi explained.

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https://www.foxbusiness.com/economy/leading-economist-issues-stark-recession-warning-struggling-us-economy

[rustynail]

'Stimmy checks' before Christmas?

[DefiantMassRINO]

If the US economy is suffering, it's because of a non-optimal regulatory and tax regime.

The biggest impediment to American prosperity and American global competitive advantage is decades of bad Government policies.

Government has gotten larger while much value-add economic activity has moved offshore because it's too diffuclt to make, implement, and complete long-term capital projects in the US, i.e., Keystone XL pipeline.

The Dem party is anti-capitalist and has used environmental regulations to kill private capital enterprise in America.  An oil company could never build a rig off Nantucket. But Government subsidized foreign interests can fast track and shoe-horn a wind turbine farm, with impunity from the same approval processes and delays that an oil company would endure.  Government is choosing losers to be the winners.

How many high-paying American 'green' jobs has GE Vernova created at its turbine blade factories in Canada and France?  Why is a Spanish utility consortium geting preferentional treatment from the same Government that attempts to kill American energy?

[jafo2010]

We are still living with the vagaries of the Biden Idiocracy.  It will take another year to fully reverse the damage done by Biden/Harris & Co.

Inflation exists still because it has yet to be tamed fully.  PERIOD!!!!!!!   Trump's policies will take time to manifest in full, but he is doing many of the right things to reverse the damage by Biden.

And the Democommies in their infinite stupidity are doing everything they can to undermine the Trump Administration, using the corrupt propaganda media that should not be permitted to exist if they are going to keep distorting what they report. 

I SWEAR, ANYONE THAT VOTES FOR THE DEMOCOMMIES HAS A VERY LOW IQ!!!!!!!!!  Or at least, based on the folks I know, that is the case. 

[berdie]

Frankly, I've been reading about recession, depression or full on crash for the last 5, 10 years. 

Do I think something will happen eventually...sure. But am I going to listen to the "experts" and panic every time they open their mouths...nope.

My prediction, about the time I might have to go to a facility and really need the money the bottom will fall out. Ya'll might want to pray for my good health to prevent this calamity, I'll probably be the catalyst.

[Smokin Joe]

Frankly, I've been reading about recession, depression or full on crash for the last 5, 10 years. 

Do I think something will happen eventually...sure. But am I going to listen to the "experts" and panic every time they open their mouths...nope.

My prediction, about the time I might have to go to a facility and really need the money the bottom will fall out. Ya'll might want to pray for my good health to prevent this calamity, I'll probably be the catalyst.

Stay well, dear!

[DefiantMassRINO]

The inversion of the short-end of the yield curve is signaling all is not well with market liquidity and the credit markets.

https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value=2025

Not the end of the world, but an early canary in the coal mine.

[Weird Tolkienish Figure]

I wish instead of these blanket tariffs, Trump did something like a bottoms up approach to tariffs where companies could request tariff protections ... and THEN they would be considered and implemented. And then this could be paired with the traditional supply side economic boosts, lowering of regulations etc.