The Federal Reserve's megaphone: The US economy may face a hard landing

Federal Reserve mouthpiece Nick Timiraos wrote in the Wall Street Journal that over the past year, U.S. economic policymakers have been focused on achieving a so-called soft landing, that is, lowering inflation without a recession. Now, a new group of pilots "is considering a course correction, which they themselves admit could send the economy towards a hard landing.
In recent days, President Donald Trump and his top advisers have shown indifference to the rising risk of a setback for private-sector investment due to trade uncertainty. They argue that detoxification may be needed in terms of spending and hiring, that falling stock values are not a concern, and that inflation could rise in the short term. Some analysts have warned that Trump's message may reflect a strategic effort to improve the country's bargaining position with trading partners, leaving bond investors and the Federal Reserve jaw-dropping and thus maintaining a propensity to cut interest rates.
Trump's impulsive behavior has prompted European authorities to take steps to increase economic stimulus and defense spending. Analysts say the past two weeks have shown that Trump is unlikely to change course because of the market slump, which will help reset Wall Street's expectations. Andy Laperriere, director of U.S. policy research at PiperSandler, said: "Everything he's done is telling us he's not kidding. On tariffs, he believes it in his bones.