with Brent D. Griffiths


President Trump risks tipping the United States — and the world — into recession if he presses ahead with tariffs on Chinese imports set to bite in just 11 days. 

That’s the conclusion some economists are drawing after the president renewed trade tensions with Beijing by saying he was open to waiting until after the 2020 election to reach a deal some advisers recently described as imminent. 

“The economy is on the precipice and this would just push us over into the abyss. I don’t think we’re very far from recession as it is,” Moody’s Analytics chief economist Mark Zandi tells me. 

Zandi sees a cascade effect ricocheting through the economy if the administration follows through on its threat to impose 15 percent import levies on $160 billion of Chinese goods, a list that includes laptops, cellphones, toys and other consumer goods. “It would just be too much,” he said of the tariffs planned for December 15. “It would undermine investor confidence, weaken business sentiment and the negative reinforcing dynamics of a recession would take hold.”

Investors are processing the renewed threat, with the Dow Jones industrial average dropping 1 percent, its third straight day of losses and the steepest one-day sell-off since early October, as the Wall Street Journal’s Michael Wursthorn and Anna Isaac write.

Gregory Daco, chief U.S. economist at Oxford Economics, said his firm projects the next round of tariffs would trim 0.2 percent from economic growth. “It’s not huge, but it’s one additional layer of drag on top of the tariffs we’ve already seen,” he said. “I would note the possibility that the loss of confidence from the private sector would exacerbate that.”

Daco says tariffs alone would be unlikely to precipitate a recession. But like Zandi he said they could ripple out dangerously if they depress business confidence, weighing on financial markets, reducing hiring and, ultimately, crimping consumer spending. “If we have an end of the year like last year,” with tariffs rising, a government shutdown looming, and the Federal Reserve signaling it won't help, Daco noted, “We’re starting off from a much lower point in activity now, and the risks of a recession going into 2020 are that much greater.”

How seriously to take the possibility the Trump team fails to reach an agreement with its Beijing counterparts that forestalls the tariffs remains uncertain. While in London for NATO's 70th anniversary summit, Trump said "in some ways I like idea of waiting until after the election for the China deal." Still, he noted that the Chinese "want to make a deal now and we will see whether or not the deal is going to be right." 

But Bloomberg News reports despite the heated rhetoric, Washington and Beijing are moving closer to agreeing on how many tariffs already in force should be rolled back as part of a phase-one deal. And the WSJ's Bob Davis and Lingling Wei report the recent involvement of White House adviser Jared Kushner could indicate a deal is close-at-hand. 

Stephen Myrow, managing partner at Beacon Policy Advisors, said his firm has been telling clients they believed the Dec. 15 deadline didn’t necessarily mean much: As long as the two sides were continuing to negotiate in good faith, the Trump team was likely to find a way to put them off. Now, he says, “it's fluid in the sense that Dec. 15 is starting to look like a harder deadline than it was, say, 48 hours ago. But that in and of itself can change.”

Commerce Secretary Wilbur Ross appeared to underscore the two sides still have difficult issues to resolve, and the U.S. feels no urgency to strike a deal. Ross told Reuters in an interview that the point Trump, in his comments at the NATO summit in London, “was trying to make is we need a proper deal, and whether it comes this December, or it’s next December, or some other date is much less important than getting a proper deal.”

“The important thing is to get a deal that works,” he said. “Because let’s face it, if we don’t make a deal with China now, it’s going to be a long, long time before there is a deal.”

Investors perceive a pattern they hope will play out again in the coming days: Trump tends to ramp up trade confrontations when the stock market is gaining steam and back off when it tumbles. The president was dismissive of the trade-induced selloff, calling it “peanuts.” And, he said, “I don’t watch the stock market.” The claim is belied by his own Twitter feed: 

“There’s this binary moment in the market where people are freaking out, and there’s also a group that says, ‘He’s focused on reelection, and he knows how bad this would be for it, so he’ll pull back,’” Myrow says. “There’s a lot of post-hoc rationalization. But a lot of this comes down to what was on Fox News that morning, what did he have for breakfast, and what’s going on with impeachment.”


All eyes on payrolls number. CNBC's Patti Domm: "Wednesday’s report of ADP private payrolls could give clues on the labor market, the next part of the economy to be scrutinized after an important manufacturing report showed an unexpected decline. ADP is expected to show that 140,000 payrolls were added in September, following 195,000 in its report in August. That August number was not a good barometer for the much lower government report of just 96,000 private payrolls in August, but it will be watched nonetheless. Total payrolls were 130,000 in August, including government workers."

Investors look to fiscal stimulus. Bloomberg News's Gregor Stuart Hunter: "The next push for the global economy may come from governments instead of central banks -- and the outcome for markets could be messy. Synchronized monetary easing helped keep global stocks and bonds afloat amid a succession of bruising trade disputes and geopolitical flare-ups in 2019. But the effect may tail off soon, and an array of government spending measures designed to fuel growth may produce much more divergent results.

"The outlook for markets in the next year varies 'drastically' from country to country in line with the ability of each to deploy fiscal stimulus, said Hannah Anderson, global market strategist at JPMorgan Asset Management. The result will be 'incredibly wide dispersion' for stock markets 'and quite a bit of volatility therein,' she said."

— Post-Thanksgiving shopping was no turkey after all: “A record 189.6 million Americans went shopping over the five-day Thanksgiving weekend, the National Retail Federation said, and most of them did their spending online,” my colleague Abha Bhattarai reports.

“The new bar represents a 14 percent increase from last year, the industry lobbying group said. About 48 million consumers shopped only in stores, 66 million shopped only online, and 76 million shopped both in stores and online.”



— Mexican official’s return signals possible USMCA momentum: “Mexican undersecretary for North America Jesús Seade is headed back to Washington to meet with U.S. Trade Representative Robert Lighthizer this week, three people familiar with the plans told Politico,” Megan Cassella and Sabrina Rodríguez report.

“The meeting comes as the two sides are racing to wrap up a compromise on changes to the U.S.-Mexico-Canada Agreement. After a flurry of meetings late last week involving Seade, Lighthizer and Canadian Deputy Prime Minister Chrystia Freeland, the U.S. had asked Mexico for a response by [Tuesday], a fourth person closely following the talks said.”

— France fires back on possible tariffs: “The French government fired back Tuesday against the Trump administration’s threats to slap hefty tariffs on dozens of popular French products, insisting that the European Union would retaliate if the White House went through with its proposal,” my colleague James McAuley reports from Paris.

“Later in the day, President Trump suggested that some kind of compromise might be achievable, and French President Emmanuel Macron indicated his willingness to work toward one. This came hours after Bruno Le Maire, France’s finance minister, vowed what he called a ‘strong European riposte’ to Trump’s proposed tariffs — as much as 100 percent on about $2.4 billion in imported goods, including wines, cheeses and certain designer clothes.”

  • Key quote: “We need to be pugnacious,” Agnès Pannier-Runacher, a junior economy minister, said speaking to France’s Sud Radio.

— Ross said imported auto tariffs might still be possible: Commerce Secretary Wilbur Ross said that “the Trump administration has not ruled out imposing tariffs on imported autos, after letting a review period end in November with no action,” Reuters’s David Shepardson reports.

“[Trump] did not announce any new tariffs after a six-month, self-imposed review period expired in mid-November following a Commerce Department investigation into whether imported autos pose a national security threat. He has threatened to tax them by as much as 25%.”

— Huawei could have been kicked out of U.S. banking system: “The Trump administration considered banning China’s Huawei from the U.S. financial system earlier this year as part of a host of policy options to thwart the blacklisted telecoms equipment giant, according to three people familiar with the matter,” Reuters’s Alexandra Alper reports.

“The plan, which was ultimately shelved, called for placing Huawei Technologies Co, the world’s second largest smartphone producer, on the Treasury Department’s Specially Designated Nationals (SDN) list. One of the people familiar with the matter, who favors the move, said it could be revived in the coming months depending on how things go with Huawei. The plan was considered by the White House National Security Council, and seen by officials as a nuclear option atop a ladder of policy tools to sanction the company, two of the people said. Such a designation can make it virtually impossible for a company to complete transactions in U.S. dollars.”

— Verizon CEO doesn’t want 5G “cold war”: “Verizon CEO Hans Vestberg told CNBC ... that he does not want geopolitical tensions around 5G technology to become further inflamed,” CNBC’s Kevin Stankiewicz reports.

“Asked whether he thought the fight between the U.S. and Chinese tech giant Huawei could result in a so-called 5G cold war, creating a fractured global network, Vestberg said, ‘I hope not.’ ”


— Appeals court sides with House over Trump’s financial records: “House Democrats can access President Trump’s private financial records from two banks, a federal appeals court ruled, finding a ‘public interest’ in refusing to block congressional subpoenas,” my colleagues Ann E. Marimow and Renae Merle report.

“The New York-based appeals court upheld Congress’s broad investigative authority and ordered Deutsche Bank and Capital One to comply with the House subpoenas for the president’s financial information. The court gave the president seven days to seek review by the Supreme Court in the case, which predates the public impeachment proceedings in the House.”

IMPEACHMENT MINUTE: A speed read on the latest from the congressional impeachment inquiry.

Over the past three years, President Trump and some of his allies have at times mimicked Russian President Vladimir Putin’s rhetoric on election interference. (The Washington Post)

"‘Bunch of brawlers’: Judiciary panel’s most aggressive members ready to rumble in impeachment probe." By The Post's Elise Viebeck, Mike DeBonis and Rachael Bade 

GOP embraces a debunked Ukraine conspiracy to defend Trump from impeachment” By The Post's Robert Costa and Karoun Demirjian


— Massive change at Google's parent company: “Google co-founder Larry Page is stepping down as CEO of the search giant’s parent company in favor of Google CEO Sundar Pichai, marking a major shift for one of the world’s most valuable companies,” my colleague Greg Bensinger reports.

“Page and co-founder Sergey Brin will no longer be involved in day-to-day operations of Alphabet, the parent company, according to an announcement, though they will keep their board seats. Page has turned over the CEO role once before, in 2001, to Eric Schmidt, who held the post for nearly 10 years before handing the reins back to Page.”

  • What’s next: “Pichai inherits sole responsibility for a company buffeted by antitrust investigations and the ire of [Trump]. Under Pichai, Google has been trying to become more buttoned up, amid a series of leaks to the media and worker pushback. Some things will remain the same: Brin and Page hold a majority of the company’s voting stock, meaning major board decisions still need their stamp of approval.”

— India is changing the rules after tech giants bet big: “After Walmart Inc. sealed a $16 billion deal last year to buy India’s biggest domestic e-commerce startup, it got some bad news. India was changing its e-commerce regulations,” the Wall Street Journal’s Newley Purnell reports.

“Foreign-owned online retailers would need to modify their supply chains and stop deep discounting. Those rules didn’t apply to Indian companies. India, the world’s biggest untapped digital market, has suddenly become a much tougher slog for American and other international players.”

  • Where this push is coming from: “Seeking to match China’s success at protecting and promoting homegrown tech giants, such as Alibaba Group Holding Ltd., Tencent Holdings Ltd. and TikTok parent Bytedance Inc., India is increasingly trying to shelter domestic companies.”
  • Who is at risk: “In the crosshairs, beyond Walmart, are firms including Amazon.com Inc., Alphabet Inc.’s Google and Facebook Inc. and its WhatsApp messaging service.” (Amazon CEO Jeff Bezos owns The Washington Post)

— Bridgewater co-CEO to depart: “Bridgewater Associates said Eileen Murray plans to step down as co-chief executive in March, culminating a sometimes rocky leadership transition at the world’s largest hedge fund,” the WSJ’s Rachael Levy reports.

“David McCormick, who has shared duties with Ms. Murray since 2017, will become sole CEO, the firm said. Bridgewater, which manages $160 billion in assets, said the change marks the end of founder Ray Dalio’s succession planning. That process has been marked by tumult. Mr. McCormick’s elevation represents the sixth change to Bridgewater’s chief-executive lineup since 2016.”


Once considered a front-runner, Sen. Kamala D. Harris (D-Calif.) dropped out of the 2020 presidential race on Dec. 3. Here’s what happened to her campaign. (The Washington Post)

— Harris drops out: Democratic presidential candidate Sen. Kamala Harris's “departure is the latest surprise in a Democratic primary that has repeatedly defied prediction, with several prominent senators, as well as candidates of color, struggling in a political landscape marked by anger, passion and a desperate Democratic desire to unseat Trump. The other early star of the campaign, former congressman Beto O’Rourke (D-Tex.), dropped out a month ago,” my colleague Chelsea Janes reports.

  • Why now?: “In a note to supporters, Harris stressed her campaign’s financial struggles as the driving force behind her departure. 'I’ve taken stock and looked at this from every angle, and over the last few days have come to one of the hardest decisions of my life,' she wrote. 'My campaign for president simply doesn’t have the financial resources we need to continue.' "
  • But the news came as a shock to some of Harris's biggest backers: Some of those supporters had “just announced a super PAC to support Harris’s candidacy. Some donors spent the day frantically trying to retrieve hundreds of thousands of dollars they had wired into the super PAC’s account. One of Harris’s biggest backers, Quinn Delaney, had even approved a large transfer of funds to pay for an Iowa television ad from the new super PAC — a fact unknown to the Harris staffers as they prepared to pull the plug.”

A parting blow: " 'I’m not a billionaire. I can’t fund my own campaign. And as the campaign has gone on, it’s become harder and harder to raise the money we need to compete,' " Harris wrote her letter, a not-so-subtle shot at former New York mayor Mike Bloomberg and financier Tom Steyer.

  • Her fellow candidates took notice: 


FDIC inclined to join OCC on Community Reinvestment Act overhaul. American Banker's Hannag Lang: "Federal Deposit Insurance Corp. Chair Jelena McWilliams said she is 'inclined' to back a forthcoming proposal to revamp the Community Reinvestment Act, but added she still has some concerns about how the plan will affect CRA assessment areas and compliance metrics. The Office of the Comptroller of the Currency will reportedly move ahead with a proposal to reform the 40-year-old law that grades banks on their loans to the communities they serve. The OCC collected public feedback last year on possible changes to CRA, but since then it has been unclear if the agencies would move together or separately on a proposal."


American students are testing well behind those of countries leading the world in STEM scores, via Liz Ann Sonders: 



  • Slack Technologies, Restoration Hardware, Five Below, H&R Block and Campbell Soup are among the notable companies reporting their earnings.


  • The Senate Banking Committee holds a hearing on the oversight of financial regulators, Fed Bank supervisor Randal K. Quarles and  FDIC chairman Jelena McWilliams are among those expected to testify.
  • Dollar General, Tiffany & Co. Kroger, Express, Michaels, Ulta Beauty and American Outdoor Brands are among the notable companies reporting their earnings. 
  • The Financial Services Committee holds a hearing on the Trump administration’s “deregulatory approach to financial stability.”
  • A Financial Services Subcommittee holds a hearing on the FHA and its impact on home ownership.
  • The Brookings Institute holds an event titled “The repo market disruption: What happened, why, and should something be done about it?”


  • The Labor Department publishes the latest jobs report
  • The Financial Services Committee’s task force on artificial intelligence holds a hearing on “the impact of AI on Capital Markets and Jobs in the Financial Services Industry.”
  • Big Lots is among the notable companies reporting their earnings. 
  • Brookings holds an event titled “The great reversal: How America gave up on free markets."


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President Trump on Dec. 3 called Rep. Adam B. Schiff (D-Calif.) a “maniac,” said Canada was “slightly delinquent” and backtracked on a comment about Iran. (The Washington Post)