Joseph Stiglitz, a Nobel laureate, warns that Trump’s unpredictable tariff threats have created a risky environment for investment in the US, potentially leading to stagflation. He argues that investor confidence has diminished due to the inconsistent tariff policies and Trump's disregard for laws and contracts. Stiglitz suggests that the uncertainty will not only slow economic growth but may also drive inflation higher. As a result, the Federal Reserve may need to consider raising interest rates amid fears of inflation, altering how investors view the future of the US economy.
Stiglitz highlighted that the uncertainty from Trump's on-off tariff plans undermines investment confidence, triggering fears of a stagflation scenario in the US economy.
He pointed out that the US has become a 'scary place to invest' due to the inconsistent policies that deter firms from locating their factories domestically.
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