Musk's AI Chatbot Warns Trump Tariffs Could 'Cause a Recession' as Markets Face Worst Stretch Since 2008

Elon Musk's AI chatbot, Grok, has warned that President Donald Trump's recent tariffs could lead to a global recession.

As the stock market suffers its fourth consecutive losing session on Tuesday, a French X user asked Grok to clearly explain a video clip featuring French economist Jacques Attali discussing US tariffs. In the video, Attali warns that US tariffs will lead to "a recession with inflation."

"US tariffs, taxes on imports, can cause a recession (decline in economic activity) and inflation (rising prices), according to Jacques Attali," Grok answered in French.

"The prices of imported goods are rising, hence inflation. If countries retaliate, trade falls, leading to a recession," Grok clarified.

With less trade and higher prices, economies face the complex challenge of "stagflation (recession + inflation)."

"Stimulating the economy worsens inflation, and slowing it worsens the recession," the AI chatbot said.

While the White House has downplayed the implications of Trump's tariffs and the accompanying market volatility, many economists remain uneasy.

"Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth," JPMorgan Chase CEO Jamie Dimon told shareholders Tuesday.

As the debate over the tariffs continues, market analysts and AI predictions alike highlight the potential for significant economic repercussions.