Sep 25, 2026 16:40 pm IST

Opinion | Is The World Staring At A Big Stock Market Crash - And Recession? 5 Uneasy Signs

On Wednesday, the US bond market recorded its worst day since Trump's "Liberation Day" tariffs rattled markets in April 2025. The 30-year US Treasury yield topped 5.43%, putting it on track for its highest close since 2004.

Naresh Kaushik Naresh Kaushik Columnist

Naresh Kaushik Columnist

In his address to the United Nations General Assembly on Tuesday, Donald Trump painted a rosy picture of the US economy, including exaggerated claims about foreign investment, job creation, and his administration lifting Americans out of poverty. The US Federal Reserve, under its new Chairman, Kevin Warsh, is also not too worried about the economy's health, despite raising interest rates a week ago, the first such move in three years. But the picture of the world's largest economy is far from rosy, with some experts even predicting a stock market collapse and a recession engulfing the entire world. Trump has played a major role in creating that possible scenario, though other clouds on the horizon also warrant concern.

On Wednesday, the US bond market recorded its worst day since Trump's “Liberation Day” tariffs rattled markets in April 2025. The 30-year US Treasury yield topped 5.43%, putting it on track for its highest close since 2004. Benchmark 10-year yields also reached their highest level in 19 years that day. Yields rise when bond prices fall. The latest panic selling of US government bonds followed Iranian President Masoud Pezeshkian's warning at the UN that his country will never bend to US bullying, suggesting there is no end in sight to the Iran conflict. It also comes after American debt crossed the USD 40 trillion mark in August, and growing evidence that the recent strength in the US economy has largely stemmed from disproportionate AI investments, at the cost of other sectors. If you combine these developments with warnings about massive death and destruction from El Niño, we are looking at a looming severe global financial crisis.

Eighteen years ago this month, one of America's banking giants, Lehman Brothers, collapsed, plunging the global economy into a deep recession. The default followed a credit crisis triggered by the massive housing loans issued by Lehman and other US banks in previous years. US economist David Rosenberg, who predicted the 2007-2008 financial crisis, has warned that we are heading towards another recession. “Not once in the post-WWII era, outside of 2022 when the American consumer was swimming in a USD 2 trillion pool of fiscal stimulus checks, has the Fed managed to........

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