• Whether it be investment banks, analysts, or economists, the finance world mostly agrees that tariffs are bad news ahead of what President Donald Trump has called “liberation day.”

Economists are raising their recession odds, and investors are worried about tariffs on so-called “liberation day,” but there’s talk of a market bottom. Welcome to the week of April 2: the day president Donald Trump will deliver on his promise to impose reciprocal dollar-for-dollar tariffs.

Fundstrat’s Tom Lee suggested on CNBC Monday that markets could have the “right pieces” for a bottom this week. The cofounder of Fundstrat has earned a reputation for his recent, correct stock-market forecasts, and his call for a bottom would be a bullish signal that the worst of the selloff may be over, clearing the way for a rebound.

In fact, after stocks initially sank early Monday, they pared losses sharply, and the Dow even turned positive.

For now, investors are worried about what tariffs will look like on April 2, whether they’ll hurt the economy, and other policies coming from the Trump administration, Lee said. Markets are oversold and investors are de-risking, he added.

“It’s an interminable wait for people because it is still three days, and they’re fearful we could have three days down 2%,” Lee said.

But he thinks the U.S. will come out of this okay, comparing the present situation to Brexit, when the United Kingdom withdrew from the European Union but eventually saw stocks rally. Still, there is distortion in the U.S. economy at the moment. People are buying wine and cars before tariffs, he said, and that isn’t great for prices.

Meanwhile, Wall Street increasingly suspects tariffs could send the economy into a downturn.

On Sunday, Moody’s chief economist Mark Zandi raised his recession odds. He now sees a 40% chance that a recession will occur this year; he previously suspected there was a 15% chance. Zandi blamed an intensifying trade war from Trump’s tariffs and layoffs from Elon Musk’s Department of Government Efficiency for stubborn inflation and sliding consumer sentiment.

The coming reciprocal tariffs will only worsen things, Zandi said on X. “As long as the tariffs and DOGE cuts continue to mount, so too will the odds of recession,” he wrote.

He isn’t the only one to see a greater chance of a recession. Goldman Sachs said there is a 35% chance that gross domestic product could contract for two straight quarters, in a research note released Sunday. Earlier, the investment bank only saw a 20% risk of a recession.

Tariffs are again to blame because of their tax-like effect on disposable income and consumer spending, plus their tendency to push markets around, the bank said. When businesses face an extra tax, they tend to pass that cost onto consumers, which is why tariffs are considered inflationary—and why one think tank believes they are “a recipe for making Americans worse off.”

JPMorgan said there’s a 40% probability that the economy falls into a recession this year because it sees lower growth and higher inflation on the back of an estimated 11% effective tariff rate, the bank said in a note dated March 28. Not to mention, the bank does not believe “liberation day” will close the 2025 trade war chapter.

Auto tariffs, specifically, are on analysts’ minds. Trump set a 25% tariff on foreign-made cars and parts. The levies won’t hurt cars made in America, but according to one analyst there is no such thing as a car completely made in the U.S.

So the car tariff would be “a back breaker and Armageddon for the auto industry,” Wedbush analyst Dan Ives wrote in a note published Monday morning. He estimated the typical car would be $5,000 to $10,000 more costly for an American consumer since the auto industry would incur $100 billion more in costs each year. “The concept of a U.S. car maker with parts all from the U.S. is a fictional tale that does not exist and [it] would take years to make this concept a reality,” Ives wrote.

In a note published Monday, Bank of America echoed Ives and many others, bluntly claiming “auto tariffs are bad,” and that the idea that they’ll create more jobs doesn’t pass the test of “sound economic theory.”

The housing world is concerned about tariffs too. Trump placed a tariff on steel and aluminum, and lumber could be next. All are used in the construction of homes. Builders estimate that levies could add an extra $9,000 to the price tag on every home. Considering housing is at a post-pandemic standstill because of deteriorated affordability and the lock-in effect, many people couldn’t bear even one more increase in cost.