The Contrarian Investor Podcast
Economic Cycle Still Has Room to Run, Even With Tariffs: Scott Colbert, Commerce Trust
Mar 11, 2025
Scott Colbert, a chief economist at Commerce Trust, delves into the economy's resilience despite tariffs. He argues that while these tariffs may reduce growth and inflate prices temporarily, they won't cause a recession. Colbert shares insights on the aging workforce and its effects on labor markets, suggesting a stable outlook for the economic cycle over the next four years. He also highlights the renewed appeal of fixed income investments and the potential challenges facing growth stocks in the current landscape.
30:09
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Quick takeaways
- Despite short-term challenges from tariffs causing inflation and slower growth, the economy is expected to continue its expansion for another four years.
- The labor market is facing opposing forces due to halted immigration and demographic shifts, affecting future workforce availability and economic stability.
Deep dives
Resilience of the Economy Amid Tariffs
The current economic climate, despite recent tariff impositions, suggests that the economy remains mid-cycle rather than facing imminent doom. Tariffs are primarily aimed at raising revenue and negotiating with trading partners, notably concerning issues like border control and economic security. Although the introduction of significant tariffs on imports from key partners like China, Mexico, and Canada may initially slow growth and raise inflation, these effects are viewed as temporary. Historically, the economy has shown resilience, and it is anticipated that growth will adjust and recover as businesses adapt to the new tariff landscape.
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