Given all of this, it’s not surprising that betting markets predict a 61 percent chance of a recession this year. JPMorgan concurs with those odds, as do many investors who are sending U.S. stocks back near bear market territory.

The United States is probably not in a recession today, but it’s looking inevitable that it will be soon unless the White House dramatically shifts on trade. There’s only one way the U.S. avoids a recession: if Trump stops the tariff madness.

Trump has ushered in an economy of distress, even among the rich. His tariffs are the highest since the Great Depression. Americans are terrified that prices are going to spike again, and they might lose their jobs. Businesses are equally alarmed and entering an almost-comatose state as they wait to see what happens with trade, budget cuts and taxes. Traffic at the Port of Los Angeles, the major hub for Asian imports, has dried up so much it resembles early covid days.

There’s an Economic Policy Uncertainty Index put together by professors at Stanford University and Northwestern University. It has spiked to levels that have only been seen during the pandemic. It’s already higher than during the Great Recession of 2008-2009, and it could easily surpass the 2020 readings if Trump attempts to fire the Fed chair. The trade policy uncertainty index is off the charts, showing something that has never been seen in the post-World War II era.

What’s confusing is that much of the economic data still looks fairly good. Unemployment is low. Inflation is almost back to normal, and consumer spending has been surging lately. But all of those data points are for March. They describe an economy before the massive April 2 shock on tariff announcements. Much of that March miniboom was due to consumers and businesses panic-buying before the tariffs hit (they were wise to do that). Now, the cracks in the economy are appearing: Layoffs have begun at factories. Imports are slowing. Consumers are pulling back on leisure and travel spending. There are early signs of price hikes. And it’s only going to get worse.

“I think we’re going into a recession,” said Neil Dutta, head of economic research at Renaissance Macro Research. “What’s the upside case for the economy? Even if we go back to where we were before the trade stuff and Trump just declares victory, so much damage is done, it’s hard to undo.”

There’s no safety net left to stop a downturn. The Fed isn’t going to come to the rescue and cut interest rates to prop up the economy because there’s too much concern about inflation returning. Trump is slashing government spending, especially on many areas that help the poor. Congress isn’t going to do a big stimulus package with “stimulus checks” for most Americans as it did during the pandemic. Meanwhile, consumers no longer have a ton of savings to cushion price hikes or job losses as they did coming out of covid. And the bond market freak-out has only made it more difficult — and expensive — for anyone trying to refinance their loans.

If layoffs really start to pick up, consumer spending will nosedive and a downturn is almost certain. Already, there’s been a surge in Americans who are paying the bare minimum on their monthly credit card bills — an early sign of widespread distress. The number of “minimum payers” is at a 12-year high, according to the Philadelphia Fed.

“Amid all of the noise in financial markets, we can see the recession signals in the real economy,” said Joe Brusuelas, chief economist at RSM U.S., which advises midsize firms.

Brusuelas has been tracking how companies have built up their inventories lately. It made sense to try to import as much as possible before the tariffs, but there’s a real risk that demand doesn’t hold up in this environment. Do people keep buying cars? Do companies keep buying equipment? That’s a big “if” right now.

Maybe Trump strikes the basics of a trade deal with Japan in the coming weeks and says that will be a template for more deals. Maybe he backs off on the reciprocal tariffs and just keeps in place the 10 percent global levy. There are a number of ways he could declare some sort of victory and back down.

But will anyone believe him?

“Trump has shown a willingness to pull the tariff guns out whenever something irritates him: drugs coming across the border, immigration, the trade deficit. There won’t be a lot of trust and confidence in the durability of any trade deal,” said Steven J. Davis, a senior fellow at the Hoover Institution and co-founder of the Economic Policy Uncertainty index.

The world finally understands just how much Trump loves tariffs.