They predict an imminent economic recession for the United States

Known as Doctor Disaster, having predicted in 2006 the risk of a financial meltdown in the world’s largest economy that finally materialized in 2008, he has now warned of a severe recession and financial crisis, as he thought the idea would be short-lived. The superficial is completely fictitious.

Two years before that catastrophe, he discovered the bursting of the real estate bubble, the fall in oil prices, and the profound imbalances as a result.

Roubini considered among the reasons for the current scenario of economic stagnation the rise in US debt, which took off since 2008 and was exacerbated by the health crisis, as well as negative inflationary shocks to aggregate supply.

He pointed out that “in previous recessions, like the past two recessions, there was a massive monetary and fiscal slack, this time we will enter the recession by tightening monetary policy, and we have no fiscal space.”

On Wednesday, the Commerce Department’s Office of Economic Analysis reported that the northern country’s gross domestic product contracted by 0.2 percent in the second quarter of 2022, compared to the previous three months, which technically constitutes an unofficial indicator of economic stagnation.

From an annual rate perspective, real GDP declined by 0.9 percent in the April-May-June period, after a decline of 1.6 in the first three months of this year.

Equally important is the behavior of inflation, which rose to 9.1 percent last month, the fastest pace since 1981, mainly due to higher fuel and food prices.

Despite all these numbers, Joe Biden’s government insists that the country’s economy remains strong.

jha / crc