The US will need to spend trillions more...
EDITOR'S NOTE: We would kindly remind you of this article from earlier today on INFLATION (really the devaluation of your currency). Additionally, we would like to remind you of the dozens of articles and emails we have posted about what a total fiat currency collapse looks like: it's spelled V-E-N-E-Z-U-E-L-A.
- 33% of the respondents in the CNBC Fed survey believe the economy won’t be fully restored until the second quarter of 2022, but there are a wide range of views about the recovery.
- More money will be needed from the Federal Reserve and Congress to combat the pandemic slowdown.
- GDP will decline by 24% this quarter, respondents to the survey predicted. The unemployment rate will rise as high as 19% and remain elevated through next year, they said.
- Other highlights of the survey: rates will remain at zero the rest of year, stocks will finish lower from here and there is a strong chance of a second contagion.
The economy could take one to two years to rebound to full strength and the Federal Reserve and Congress, having already committed historic sums to fight the coronavirus pandemic, will have to commit trillions more, according to respondents to the CNBC Fed Survey.
With the Federal Reserve’s balance sheet already at an unprecedented $6.45 trillion, the 36 respondents see it rising on average to $9.8 trillion. The additional trillions, respondents expect, will be added by the end of the current quarter. Congress, having already committed about $2.5 trillion, is seen putting in an additional $2 trillion.
“My guess is that the virus itself will largely disappear within a year, but that the structural social and economic impacts will be with us much longer,” John Kattar, chief investment officer at Ardent Asset Management wrote in response to the survey.
Jack Kleinhenz, chief economist for the National Retail Federation, said, “The policy response has been appropriate, but policy takes time to work its way into the economy and targeted sectors…Many small businesses stand at risk.”
Despite the tsunami of relief, respondents still see the unemployment rate rising to a peak of 19%, hitting that level in August 2020. It’s expected to decline only gradually, falling to 11% by December and to 7% by the end of 2021. That would leave it at about double the rate before the crisis took hold.
Read Original Article at cnbc.com
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