CNBC’s Kayla Tausche earlier this week asked White House trade advisor Peter Navarro about the nation’s manufacturing sector. Navarro, who has Donald Trump’s ear on these issues, was incredulous. “Manufacturing is strong as a rock,” he said.
Yeah, about that…
U.S. manufacturing fell deeper into a contraction last month, erasing hope of a quick turnaround for the industry and handing a blow to President Trump’s promises that he would revive blue-collar jobs and companies.
September marked the worst month for U.S. manufacturing in more than a decade – since June 2009 – according to the closely watched Institute for Supply Management’s manufacturing index. Companies blamed Trump’s escalating trade war for many of their woes, putting pressure on the White House to show progress soon. Manufacturing remains a prominent industry in many swing states…. Manufacturing fell into a technical recession in the first half of the year, and the latest ISM data indicates the situation appears to be getting worse.
The Washington Post’s report added that most analysts “agree that what’s happening to manufacturing is evidence Trump’s tariffs are doing real harm to the U.S. economy and is a warning sign for what could happen to other industries, especially as the tariffs expand by the end of the year onto nearly all Chinese products.”
The article went on to quote Torsten Slok, chief economist at Deutsche Bank Securities, who told clients, “There is no end in sight to this slowdown, the recession risk is real.”
Remember when Trump said trade wars were “good” and “easy to win”? I do.
For his part, the president yesterday blamed Federal Reserve Chairman Jay Powell – whom Trump appointed – for hurting the manufacturing sector. Referring to the Fed’s board of governors, the Republican wrote on Twitter, “They are their own worst enemies, they don’t have a clue. Pathetic!”
In reality, Powell has cut interest rates in order to help counteract the adverse effects of Trump’s trade war.
As Wall Street struggles through another tough day, the president shifted his attention this morning from the Fed to congressional Democrats, whom Trump claimed are deliberately “driving the Stock Market, and your 401K’s, down” through an impeachment inquiry.
The president will no doubt find others to blame for the mess he created, but Trump’s trade war was his idea.
Update: The Wall Street Journal reported today. “For the first time in a long time, U.S. factories seem to be doing worse than Chinese ones.”