The Fiscal Reckoning Is Now Here | Jan van Eck

And a recession comes next

When markets are in turmoil as they are now, I often emphasize that the most useful people to interview are asset allocators.

Because they don't have the luxury of merely having an opinion on the road ahead -- they have to commit capital to their convictions, and be judged upon the results.

Today we have the great fortune of having the return appearance of one of the most respected capital allocators in the business: Jan van Eck

Jan is CEO of vanEck, an asset management firm with over $100 billion in assets under management invested across its wide family of ETFs and funds, spanning equity, bond, commodity, digital and regional asset classes.

As we've done the past several quarters now, Jan and I spend the hour discussing his latest macro and market outlooks, as well as where he sees the biggest opportunities for investors right now.

He sees us right in the middle of the “fiscal reckoning” he’s been predicting, and thinks a recession later this year is near-unavoidable at this point.

For all the details, click here or on the video below.

And if you want to access the charts Jan walks through in this presentation, click here.

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Adam’s Notes: Jan van Eck (recorded 4.8.25)

EXECUTIVE SUMMARY:

• Fiscal Reckoning Unfolding: Jan van Eck asserts that the US is midstream in a fiscal reckoning, predicting a 3% GDP cut in government spending or tax cuts ($1 trillion), driven by post-Liberation Day austerity, contrasting with Wall Street’s skepticism and signaling a recessionary shift from last year’s 6.4% GDP deficit.

• Liberation Day Tariff Shock: Jan views Trump’s severe, unexpected tariffs as reinforcing his austerity outlook, slashing deficits but pressuring equities with short-term inflation and long-term contraction, though he discounts their $600-800 billion revenue estimates to $250 billion, aligning with a shallow recession narrative.

• Equity Markets Under Pressure: He forecasts downward equity pressure from fiscal cuts—2 million job losses (400,000 federal, 1.6 million contractors)—and tariff fallout, with corporate earnings uncertainty and unemployment (up to 4.5-5%) looming, yet sees Fed rate cuts (200 basis points) as a silver lining.

• Important Hedges: Jan remains bullish on