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3471The U.S. economy just got a dramatic review from someone who used to help run it.
Former Obama economic advisor Robert Wolf went all out on Fox News this Friday, saying the state of things now “feels more like the Game of Thrones Red Wedding.”
And he didn’t stop there. He described what he sees as a series of bad economic decisions that are stacking up quickly and dangerously.
Markets Collapse As Trade War Escalates
His comments came just as global stock markets suffered a second straight day of massive losses.
The Dow Jones Industrial Average plunged 2,231 points on Friday. The S&P 500 dropped 6%, its worst weekly showing since the COVID market crash in March 2020.
Canada’s S&P/TSX Index fell more than 1,100 points, marking one of its worst days since 2020.
The market chaos was triggered by China’s announcement of a 34% retaliatory tariff on all U.S. imports, a direct response to President Donald Trump’s earlier tariff hike.
China’s Commerce Ministry said the new U.S. tariffs “seriously violate” global trade rules. That message, paired with sharp action, rattled investors across the world.
“Trade wars are bad. Tariffs are a tax,” Wolf said bluntly.
“Consumer prices are not going down. We’re 70% a consumer-driven country. Building a moat around the United States with protectionist and isolationist economic policies are not positive.”
Global markets echoed that concern. Oil dropped to its lowest price since 2021. Copper prices also fell sharply—a red flag for slowing global industrial activity.
Nearly all 500 companies in the S&P 500 index saw their stock prices decline.
Experts Warn Of Recession Risks
While a surprisingly strong U.S. jobs report briefly helped the markets regain some ground on Friday morning, it wasn’t enough to offset fears about the economic road ahead.
Investors are now weighing whether a full-scale global recession is on the table.
“The market’s reaction is delivering a verdict and we should take that seriously,” said Brendan LaCerda, director of economic research at Moody’s Analytics.
He added that the scale of the tariffs caught many investors off guard, and the impact could get worse before it gets better.
Wolf pointed to real-world consequences already in motion. Whirlpool recently cut over 500 jobs in Iowa, citing cost pressures. “It’s not just businesses getting reset.”
GE Healthcare, which gets about 12% of its revenue from China, saw its stock fall 16%.
DuPont dropped 12.7% and is now facing an antitrust investigation from Chinese regulators, a move widely seen as retaliation.
Calls To Reconsider Tariff Strategy
Wolf, who has supported certain forms of targeted tariffs in the past, said he believes the current approach is far too broad and lacking in strategic focus.
“Go after the eurozone on auto. Go after China on steel and intellectual property,” he said. “But across the board is just coming back to haunt us.”
He also criticized the advisers around President Trump. “His economic advisers are being intellectually dishonest. This is being executed poorly.”
According to Wolf, some in Congress may finally be ready to act. He mentioned that senators from Iowa and Washington are working on a bipartisan bill aimed at reining in the president’s authority on tariffs.
It’s a sign that some lawmakers see the need to shift direction.
“Congress really has not been muscular on any of these issues, even though they have the power to be and probably should have been a long time ago.”
Trump Stands Firm, Markets Unmoved
Despite mounting market losses and rising concerns about a recession, President Trump remains defiant. From Mar-a-Lago, he took to social media to declare it a “GREAT TIME TO GET RICH,” brushing off the financial turmoil.
He acknowledged that Americans might feel “some pain” from the tariffs but said it’s worth it for the long-term goal of bringing manufacturing back to the U.S.
On Friday, he even compared the economic turbulence to a medical procedure, with the U.S. economy as the patient undergoing a necessary but painful operation.
Trump’s Secretary of State, Marco Rubio, echoed the administration’s confidence, denying that global economies are faltering.
“The markets are reacting to a dramatic change in the global order in terms of trade,” Rubio said while speaking in Brussels. “Their economies are not crashing.”
But Wolf wasn’t convinced. “The markets are efficient,” he said. “And they’re telling us something’s not right.”
With more retaliation expected from other countries and continued volatility in the markets, investors and economists alike are bracing for what comes next.
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