According to the Federal Reserve Bank Chairman in a report from the BBC, one may reasonably expect the current recession to last until at least the end of 2021.
The chairman of the US Federal Reserve has warned that the American economy may not recover from the coronavirus pandemic until late 2021.
Jerome Powell added in a CBS interview that a full rebound may not be possible until a vaccine for the virus is discovered.
Earlier this week, Mr Powell had called on US lawmakers to pass more economic stimulus and relief aid.
Over 36m Americans have filed for unemployment benefits since mid-March.
What did Powell say?
In an interview with CBS’ 60 minutes, Mr Power said: “This is a time of great suffering and difficulty… you can’t really put into words the pain people are feeling.
“This economy will recover. It may take a while,” he said. “It could stretch through the end of next year. We really don’t know.”
He added that he expected the economy to “recover steadily through the second half of this year” – provided there was “not a second wave of the coronavirus”.
But, he said, “for the economy to fully recover, people will have to be fully confident. And that may have to await the arrival of a vaccine.” (source)
This is and underestimate in my opinion, since the issue relates to the debt.
The debt is the fundamental problem that unites everything here. The debt is why the US is in so much trouble. She spent too much and can’t ever pay it back. That is the reason.
The problems are not going to end in a few years. Indeed, the recession began in 2007 and has not stopped. We are in a combination deflationary depression/moving towards hyperinflation by way of money printing.
The only way that will stop this is if the US either (a) disowns the debt or (b) hyperinflates and crashes the currency and by doing so likely starts another war. The latter is the more likely of the two as evidenced by the current bouts of money printing.