Heisenberg Report

Six In 10 Americans Say A Recession Is Likely Within The Next Year

Late last month, Donald Trump got bad news from a new Quinnipiac poll, which found that 37% of Americans say the economy is getting worse, versus just 31% who say it’s improving.

It was the first time since the election that more Americans believe the economy is getting worse than getting better.

The same poll produced another dubious “first” for the president. For the first time since November 2016, Americans think Trump’s policies are doing more harm than good to the US economy.

Read more: For The First Time Since The Election, More Americans Think The Economy Is Getting Worse Than Better

The Quinnipiac poll was hardly the only evidence to support the contention that trade escalations and Trump’s incessant badgering of the Fed are serving to undermine confidence.

University of Michigan consumer sentiment plummeted to a Trump-era low last month, and an NBC News/Wall Street Journal poll showed support for free trade rising to the highest on record, in what could be evidence of tariff fatigue among the electorate.

All of this as administration officials struggle to reconcile the party line about the economy being “the strongest ever” with calls for what amount to emergency Fed cuts.

The rosy economic narrative also doesn’t jibe particularly well with Trump’s penchant for loudly insisting that Democrats and the media are conspiring to engineer a recession. That kind of shrill banter is backfiring, as evidenced on Tuesday by a new ABC News/Washington Post poll which finds six in 10 Americans forecasting a recession within the next 12 months.

As you can see, Trump’s job approval rating fell to 38% in the latest poll.

As ABC reminds you, “his average rating since taking office remains the lowest on record for any modern president at a comparable point in his term, and he is the first never to have achieved majority approval”.

(Barclays)

That is the reality behind the president’s sky-high approval rating among Republicans and penchant for citing non-scientific polling data. Here’s a bit more on that from WaPo:

Given that he’s generally polling in the low 40s, adding 10 points gives him majority approval — and, in his view, makes him a success.

There are a few pollsters that, for whatever reason, generally have Trump approval numbers that are in that 10-more-points range. One is Rasmussen Reports, which is almost always more generous to Trump than the average of polls compiled by RealClearPolitics. Another is Zogby, which earlier this month had Trump’s approval at 51 percent. Both pollsters are given a C in FiveThirtyEight’s pollster ratings.

None of that is to say Trump can’t defy the polls to win a second term – not at all. In fact, he may very well prevail in 2020. It’s just to say that when it comes to which polls he cites, he habitually relies on two highly dubious sources which just happen to always have the president polling ahead of their more scientific counterparts.

In other words: If we learned anything from 2016, it’s that we shouldn’t rely too heavily on polls, but to the extent you’re going to cite polls, don’t cite Rasmussen and Zogby, because that’s patent nonsense.

In any event, more important than Trump’s net approval rating is evidence that suggests voters are souring on his economic policies.

A big part of the president’s mythos revolves around his purportedly “legendary” business acumen, and despite voluminous evidence to support the contention that his business career was in fact a case study in how not to conduct business, his base is still buying what he’s selling.

If we do get a recession prior to the election and he can’t convince the public to blame one of the many scapegoats he’s spent the last several months setting up to take the fall, Trump may find it more difficult to counter critics who have spent the better part of three years insisting that sooner or later, his policies would be detrimental to the US economy.

And if you don’t believe us on that, just ask Jeff Gundlach…


 

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