There are two big pressures pushing and pulling on the Trump economy right now. While trade chaos has rattled financial markets, the Federal Reserve might have to step in and rescue the economy. There is, however, a more recent analog: the 1973 Arab oil embargo. Both that embargo and the new tariff barriers represent a supply shock in which a reliable supply of cheap imports—oil then, manufactured goods now—is suddenly curtailed. Prices paid by American consumers and businesses go up, hitting...

Source: Wall Street Journal June 05, 2019 11:37 UTC