The Most Curious Secret Information May Have Been Revealed: Insider Sources Explained Why Donald Trump Suddenly Made the Customs Duty Decision!

According to The Wall Street Journal, US President Donald Trump secretly acknowledged that the comprehensive tariff proposal he announced last week could plunge the US economy into recession. However, he stated that his intention is to avoid triggering a large-scale depression.

The newspaper, referring to individuals knowledgeable about the subject, reported that Trump’s advisors indicated he is ready to acknowledge the economic "pain" that could result from the tariff strategy. Nevertheless, the increasing pressure on the bond market necessitated a partial reversal of the policy.

The plan, which includes significant tariffs aimed at protecting U.S. industries, had raised concerns among economists that disruptions in global trade could slow economic growth. Although a recession is increasingly seen as a possibility, experts did not foresee the more serious consequences of a depression that historically involves prolonged economic downturns and rising unemployment.

The U.S. had not experienced a depression since the Great Depression of the 1930s, when unemployment reached 25%. Economists point out that stronger financial tools, monetary policy, and federal guarantees like FDIC deposit insurance have helped prevent such extremes in modern times.

Financial markets reacted quickly to the political shock. While bond yields rose, stocks fell, triggering investor concern. Speculation that major bondholders like Japan and China were offloading U.S. Treasuries caused the yield on the 10-year Treasury bond to briefly rise above 4.5%. As yields rise, bond prices fall.

Trump ultimately helped the markets recover by withdrawing certain country-specific tariffs on Wednesday. The S&P 500 recorded its strongest single-day gain since 2008.

Kevin Hassett, Director of the National Economic Council, stated in an interview with CNBC that the turmoil in the bond market has added urgency to Trump's move. Hassett said, "There is no doubt that what happened in the bond market yesterday perhaps led to the decision being made with a bit more urgency."

Trump claimed in his statements following the retreat that the markets reacted excessively: "I thought people crossed the line a bit," he said, adding: "They got a little excited, and they were a little scared."

According to the WSJ, another factor in this change was the increasing influence of Treasury Secretary Scott Bessent in trade negotiations. Sources stated that the increase in the number of countries negotiating with the U.S. also contributed to Trump's openness to changing his approach.