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IPFS News Link • Future Predictions

What Lies Ahead?

• by Dr. Jack Rasmus

The current recession's scenario was compared with 1929-30 and 2008-09, and 8 reasons were given why the US current economic rebound (not recovery) would falter. In this follow-on post a somewhat longer term scenario is added to the prior shorter, 3rd quarter view. It's an addendum and sequel to the prior post, focusing on the more permanent impacts on the economy that will continue well into 2021 and beyond. Here's the addendum piece, "What Lies Ahead"

The US economy at mid-year 2020 is at a critical juncture. What happens in the next three months will likely determine whether the current Great Recession 2.0 continues to follow a W-shape trajectory - or drifts over an economic precipice into an economic depression. With prompt and sufficient fiscal stimulus targeting US households, minimal political instability before the November 2020 elections, and no financial instability event, it may be contained. No worse than a prolonged W-shape recovery will occur. But should the fiscal stimulus be minimal (and poorly composed), should political instability grow significantly worse, and a major financial instability event erupt in the US (or globally), then it is highly likely a descent to a bona fide economic depression will occur.