Joseph Stiglitz has addressed the possible implications of a hypothetical Donald Trump victory in the upcoming US presidential election. The Nobel laureate points out that Trump's threats to impose higher tariffs on Chinese imports and his radical "zero-sum" view of the world could lead to a fundamental change in the current US economy.

Nobel laureate Joseph Stiglitz hints at fundamental change for US economy after Trump's victory

With just days to go until the US presidential election, analysts and experts are studying the consequences of a Donald Trump victory for the country's economy. Joseph Stiglitz, the 2021 Nobel Prize winner in Economics, believes that a presumptive victory by Republican candidate Donald Trump would create changes in several economic aspects of the country and the world.

Stiglitz, who won the Nobel Prize in 2001 for his analysis of market behavior with asymmetric information, said in a recent interview that Harris would be “much better” for the US economy because she would be “more moderate.” In contrast, he stressed that Trump would introduce a number of measures that would affect US citizens, causing inflation and increasing volatility in US markets.

Stiglitz comments:

Trump's policies would lead to higher inflation, weaker GDP, more inequality and poorer health.

For Stiglitz, one of the key elements of this new inflationary phase will be the imposition of high tariffs on imports from China, something Trump has hinted at during his campaign. This will hurt citizens who have to adjust to the new price increases on clothing and household goods imported from the Asian giant.

The economist notes that rising inflation will cause the Federal Reserve to raise interest rates again, weakening the economy. This, combined with tax cuts “for the rich” and the repeal of Obamacare, threatens to change the current direction of the United States. “He is a danger to our economy in every way,” Stiglitz assesses.

Still, the economist concedes that even a Harris victory would further deepen the economic divide between the United States and China. Trump's "false zero-sum view of the world" would do more harm, however.

What do you think of Joseph Stiglitz's warnings about a Donald Trump victory? Let us know in the comments below.

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