Tariffs Trigger Trouble: JPMorgan Raises Recession Alarm

​Jamie Dimon once warned of an economic “hurricane” — and now JPMorgan says it’s about to make landfall.

Following President Trump’s bombshell tariff announcement, JPMorgan’s economists have hiked their odds of a U.S. recession this year to 60%. That’s not just a cautious tap on the brakes — that’s a full-blown slam on the economic panic button.

The bank’s top economist Bruce Kasman didn’t mince words. In a research note ominously titled "There Will Be Blood", his team called the latest 22-percentage-point tariff hike the biggest tax increase since 1968. The expected fallout? A toxic cocktail of retaliatory tariffs, shaken confidence among businesses, and snarled supply chains. Not exactly the recipe for economic stability.

And if you think this is just a blip? Think again.

Kasman warned that if these policies are fully rolled out and stick around, they’d amount to a macroeconomic gut punch strong enough to knock both the U.S. and global economy into recession. This isn’t just about short-term pain, either — they also flagged long-lasting consequences like sluggish growth due to tighter immigration and persistent trade restrictions.

One point of comparison hits especially hard: This tariff hike could be even more damaging than the infamous Smoot-Hawley tariffs of 1930. Why? Because global trade is a much bigger part of the U.S. economy today than it was back then. Bigger stage, bigger consequences.

Using an IMF model, JPMorgan’s analysts estimated a 20% tariff hike could shave 2 percentage points off U.S. GDP and 1 point off global output. That’s no small dent — that’s recession territory.

Markets didn’t take the news lightly either. The S&P 500 just endured its sharpest one-day plunge since June 2020, and futures continued sliding on Friday ahead of jobs data and fresh commentary from Fed Chair Jerome Powell.

​For now, JPMorgan is holding off on updating its official economic forecasts, waiting to see how much of this tariff talk turns into tariff action. But make no mistake: Wall Street’s biggest bank just went from cautious to downright concerned.