Moody’s Zandi says Trump’s policies set to severely diminish the economy for years

This is via Chief Economist at Moody’s Analytics, Mark Zandi:

• The Trump administration’s policies are set to severely diminish the economy, not only for the next few months but for years. The administration’s trade war is undermining the global safe-haven status of the U.S., which has provided incalculable benefits, including our economy’s exceptionalism.

Its part of a thread, in summary:

• Investors trust the U.S. due to stable laws and predictable governance.

• Trump’s erratic tariff policy undermines that stability and process.

• Political pressure on the Fed threatens its independence and risks inflation.

• Loss of credibility could push Treasury yields and lending rates higher.

• CDS spreads on U.S. debt show growing doubts about creditworthiness.

• The trade war has hurt U.S. credibility, but there’s still time to limit the fallout.

This article was written by Eamonn Sheridan at www.forexlive.com.