Former White House official and co-founder of Skybridge Capital, Anthony Scaramucci, is sounding the alarm on the U.S. economy, warning that rising tariffs and an energy shock are pushing the nation toward a painful era of stagflation not seen since the 1970s.

The Threat Of Stagflation

In a stark video address, Scaramucci cautioned that a convergence of negative economic forces is creating an unsustainable environment for working families. He pointed to what he calls a “vicious circle of recession expectations,” driving consumers to save rather than spend out of fear of future financial pain.

“Prices are up on everything, and it’s coming from three directions at once,” Scaramucci stated. He noted that even Federal Reserve appointees selected by Donald Trump are currently aligning with Fed Chair Jerome Powell‘s grim assessment of the data.

“They looked at the economic data and they are saying the same thing Powell is saying: We are heading for stagflation,” he said, defining the troubling condition as high inflation occurring simultaneously with rising unemployment.

Deepening Market Crisis

Drawing direct parallels to his own youth, Scaramucci emphasized the severe toll this economic climate takes on everyday Americans.

“The last time we felt this was the 1970s. I grew up in that era,” he noted. “I know what it does to working families. Brace yourself for a correction in the economy.”

He added that this looming economic downturn will likely trigger a “deeper correction in the stock market” alongside a significant surge in oil prices, compounding the financial squeeze on consumers.

Broken Political Promises

Scaramucci also directed pointed criticism at Trump's economic track record, arguing his policies have fundamentally failed the electorate.

He highlighted that Trump campaigned heavily on affordability and lower prices, yet delivered the exact opposite outcome for voters.

“The goalposts didn’t just move,” Scaramucci concluded. “They were picked up and thrown in the opposite direction.” With consumption slowing and fear mounting, he argues the American economy is locked in a self-feeding cycle of decline.

US Markets Decline In 2026 Amid War

The S&P 500 index has declined 4.02% year-to-date. Similarly, the Nasdaq Composite index was down 5.84%, and the Dow Jones tumbled 3.88% YTD.

The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 and Nasdaq 100 indices, respectively, closed higher on Thursday. The SPY was up 0.090% at $655.83, while the QQQ advanced 0.11% to $584.98.

Meanwhile, Dow tracker, State Street SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA), fell 0.090% to close at $465.06 on Thursday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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