The Loadstar leader: A wagon train on the trail to recession in the new 'Wild West'

Photo: © Valigursky

Perhaps Iran and Israel are not alone in not knowing “what the fuck they’re doing”, as President Trump delicately put it this week.

Slamming his administration for its tariff policy – upending nigh on a century of economic orthodoxy – is low-hanging fruit at the moment; in time, maybe, the snarky media will be proved wrong. Short-term, however, the data does not look positive. And it appears all that desperate front-loading has done serious damage.

Even before being sworn in for his second term, Mr Trump had made clear that tariffs would form the backbone of his economic policy. As forwarders and shippers told The Loadstar, the aim of the game for them was to get ahead of this. And boy did they – import volumes into the US surged some 42% during the first quarter.

That spike in imports was singled out by the Bureau of Economic Analysis as the main factor prompting what Quartz called the “starkest, ugliest contraction since the height of the Covid pandemic”. US real GDP for the three months to April shrank 0.5% – 0.3% more than forecasted and a marked reversal to the state of play when President Trump sat back down behind the Oval Office desk.

With Q4 24 GDP up 2.4%, following four preceding quarters of growth of between 1.5% and 3.1%, and the economy the biggest determinant at the ballot box, these early signs were not positive – nor were they necessary.

Touting loudly and clearly his intent to impose massive, punitive tariffs on pretty much every one of the US’s major trading partners, Trump either knew and did not care, or neither knew nor cared, to consider the signal this was sending to the market. A signal that prompted forwarders and shippers to rush as much volume as they could into the country to avoid the additional costs tariffs would bring.

But, as noted by the BEA, “imports are a subtraction in the calculation of GDP”, meaning as soon as the tariff announcement had been made, declining GDP became inevitable.

Far from shifting US consumer focus to domestic products, the noise spooked the average consumer, who tightened the purse strings and now doesn’t appear to be spending, amid increasing concern that the second half of 2025 will bring recession. JP Morgan Chase has put the chances of this at 40%.

Against this backdrop, we find ourselves asking: “What exactly is happening?” President Trump talked-up tariffs, imposed tariffs, and then issued a series of delays, retractions, suspensions.

But unlike the first time, the noise from forwarders has dimmed as the window to get goods in closes, leaving the market in some confusion.

In fact, does anyone know what the fuck they are doing?