The Trump administration is hoping to alleviate some of the concerns regarding the U.S. economy as President Donald Trump's sweeping new tariffs on foreign trade partners go into effect.
Speaking Sunday on NBC's "Meet the Press," Treasury Secretary Scott Bessent said "there doesn't have to be a recession" and expressed skepticism toward day-to-day market volatility.
"Who knows how the market is gonna react in a day, in a week," Bessent said. "What we are looking at is building the long-term economic fundamentals for prosperity that I think the previous administration had put us on a course toward financial calamity."
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His comments come just days after all three major U.S. stock indexes closed in the red, following a week of sell-offs. The Dow Jones Industrial Average plunged Friday by more than 2,200 points to close at 38,314 — marking the first time the index has fallen below 40,000 since August 2024.
The Dow's 5% decline, meanwhile, was mirrored by the S&P 500 and Nasdaq Composite, which fell by 322 points and 962 points, respectively.
The rough week on Wall Street came following President Trump's announcement that he was imposing a baseline 10% tariff on all U.S. trade partners, with additional tariffs on what the White House described as the "worst offenders."
"This is one of the most important days, in my opinion, in American history," President Trump said during the announcement last week. "For years, hardworking American citizens were forced to sit on the sidelines as other nations got rich and powerful, much of it at our expense. But now it's our turn to prosper, and in so doing use trillions and trillions of dollars to reduce taxes and pay down our national debt."
In response, countries like China and Canada responded with their own retaliatory tariffs on U.S. exports.
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The White House says the tariffs will raise hundreds of billions of dollars and spark more companies to produce their goods domestically. But many economists say consumers will pay the price — including economics professor Keith Maskus.
"In the end, it is pretty much always the domestic consumers that pay almost the full share these tariffs. And again, it's just the way tariffs work," Maskus said.
