Economics: Can We Avoid A Recession In Spite Of Trump´s Trade War?

 (Drivebycuriosity) - There is a lot talk about a coming recession recently. Trump´s trade war is doing a lot damage to the US economy, especially the manufacturing sector is suffering, and consumers have to pay higher prices. The trade war also slows China´s economic growth which is putting a break on the global economy and harms US exports further.

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But fortunately there are some counter movements. The trade war - and fears about a coming recession - keeps the price of oil at bay. Today, Brent Crude - the gauge for the global oil market - hoovers around $60, 50% below the prices in 2012. Cheaper oil translates into lower gasoline prices. As a result the gasoline addicted US consumers - many live in the sprawl and commute long distances - have more money in their wallets which compensates partly the higher prices for imported goods.

The trade war also keeps interest rates on record low levels. Companies & home owners need less money to pay for their debts and the extremely low costs for loans still inspire to invest.

The economy is also getting positive influences from the ongoing new industrial revolution.  Advances in Internet (cloud, 5G), mobile computing, 3-d-printing, robotics, nano- & biotechnology and other technologies are reducing costs & raising efficiency. These trends make the economy more flexible and help to counter a part of the cost hikes caused by the trade war.

I think that these positive influences can balance parts of the trade war carnage. As a result the US economy will grow much slower than it could, thanks to the trade war, but will avoid a full fledged recession.