Donald Trump's tariff offensive triggered a 'cardboard box recession'?

US President Donald Trump had imposed tariffs on several countries, claiming the trade deficit was harming the nation's economy. However, the US President's confrontational approach has harmed the economy more, according toexperts. The country's cardboard manufacturing has plummeted, indicating that the masses are not ordering enough goods, and consumer spending has dried up amid the uncertaintytriggered by Trump's geopolitics and economic policies.

What can a simple cardboard box say about the economy?

Cardboard boxes are used in the delivery of most goods, including home appliancesand even pizzas. When the demand for cardboard boxes drops, it is an early indicator of a drop in consumer spending, signaling an economic slowdown.

While GDP is tracked quarterly, box production drops immediately when the demand for stuff drops in the economy. This provides a real-time indicator of the economy, DW reported in an explainer video.

In the US, the Federal Reserve monitors cardboard prices for an early indication of the state of the economy.

The US demand for cardboard fell during the 2008 recession. It also fell during the pandemic. It, however, took off when the US government sent out stimulus cheques.

The US cardboard box sales have now dried up, the German publication added.

Adam Joshephson, packaging expert, Sakonnet Research, told DW that discretionary spending has dropped significantly in the US. He added that spending on artificial intelligence and government spending, along with spending on essentialslike health care, housing, and insurance, have propped up the economy.

Experts call this phenomenon the cardboard box recession.

Tarek Hassan, an economist at Boston University, told DW that Trump's assessmentthat the trade deficit essentially puts the US at a disadvantage is economically flawed.

"If I have a huge deficit with the supermarket, I go there every week, and give them money, and they give me goods. And they never buy anything from me," he said.

"There are tariffs, there isuncertainty, there are mass deportations, a lot of stuff that makes it harder to produce things. That is cooling the economy down. What's keeping us going is this massive boom in AI investment," he explained.