#249 Dr. Gary Shilling On Tariffs, Impending Recession, And Why He's Still Betting on the Dollar & Treasuries

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Apr 19, 2025

Dr. Gary Shilling, a renowned economist and President of A. Gary Shilling & Co., offers intriguing insights into the current economic landscape. He discusses the likelihood of an impending recession and how Trump's tariffs are complicating global trade dynamics. Despite these challenges, he expresses confidence in the safety of U.S. Treasuries and the dollar. Shilling also highlights the potential for Indian stocks over Chinese investments and advocates for maintaining strong balance sheets to navigate economic uncertainty.

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INSIGHT

Post-War Trade Shift

After WWII, the US grew trade deficits to rebuild the world, leading to manufacturing decline at home.
Globalization with Western tech and Asian labor shifted production overseas, disrupting US manufacturing.

INSIGHT

Trump Tariffs Disrupt Trade

Trump's tariff policies aim to end huge US trade imbalances and reshape global trade relationships.
This disrupts established supply chains and shocks global trade dynamics, forcing countries like China to negotiate.

INSIGHT

Recession Signs and Tariff Impact

Several reliable indicators showed signs of recession before tariffs intensified uncertainties.
Consumer debt is high, and tariffs add disruption, pushing the economy closer to or into recession.

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Legendary economist Dr. A. Gary Shilling, President of A. Gary Shilling & Co., an economic consulting firm and a registered investment advisor, joins Julia La Roche on episode 249 to discuss the state of the economy.

Sponsor: This episode is brought to you by Monetary Metals. https://monetary-metals.com/julia

In this episode, Dr. Shilling explains why he believes we are headed for a recession, if not already in one. He analyzes how Trump's tariff policies are disrupting global trade relationships and creating economic uncertainty while simultaneously forcing countries like China to the negotiating table. Despite these headwinds, Dr. Shilling reveals why he remains bullish on US Treasuries and the dollar as safe havens, shares his optimistic outlook on Indian stocks over Chinese investments, and advises listeners to build "fortress-like balance sheets" to weather the coming economic storm.

Timestamps:

00:00 - Introduction and welcome back Dr. Shilling

01:50 - Historical context: US economic role since World War II

03:34 - Impact of globalization on US manufacturing

04:14 - Trump's changing approach to international trade

06:37 - China's position and recent willingness to negotiate

09:03 - Signs of recession and economic vulnerabilities

12:33 - Bond market volatility and US Treasury outlook

17:18 - Perspective on gold reaching record highs

19:11 - Current investment allocations and strategies

20:21 - Why India may surpass China in global leadership

24:19 - Media coverage of market fluctuations vs long-term outlook

26:47 - Dr. Shilling's history of contrarian economic predictions

29:56 - Assessment of current economic vulnerabilities

32:04 - Consumer debt and "buy now, pay later" trends

33:27 - The US debt bomb and dollar's reserve currency status

36:52 - Potential outcomes of tariff policies

39:43 - Contact information and subscription details

40:42 - Closing advice: maintaining a "fortress-like balance sheet"

Access Dr. Shilling's monthly newsletter INSIGHT by calling this toll free number (1-888-346-7444) or visiting his website (https://www.agaryshilling.com/).