Trade War Escalation Prompts Recession Fears

Trade war worries sent Wall Street retreating Monday as some experts fear the rest of the U.S. could join agriculture in a depressed economy. Experts from Morgan Stanley predict a global recession if the trade war escalates through Trump’s threatened additional 25 percent tariffs on China. Trump intends to implement 10 percent of the tariffs next month, the cause for China’s stoppage of U.S. ag purchases and devaluing its currency. Trump accused China of using the devaluation of its currency to retaliate against the U.S., but China’s central bank denied it made the move as an intentional response to the trade war. China still plans to retaliate against the U.S. tariffs that will start in September. Morgan Stanley representatives told CNBC Monday the firm believes a global recession will come in about nine months if the trade war further escalates. U.S. negotiators met with Chinese officials late last month and plan an additional round of talks at the beginning of September.