Is the US Economy Running out of Gas?
By John W. Schoen. Is there another U.S. recession on the way? . . .
The answer depends a lot on how you measure the strength and durability of the recovery, now in its seventh year based the business cycle dates tracked by economists at the National Bureau of Economic Research . . .
To see how this recovery compares, CNBC tracked a series of economic and market data over the last eight recessions since 1960 — starting each cycle with the beginning of each downturn.
By just about every measure, the current expansion has been the weakest of the eight.
One of the main reasons has been the relatively sluggish pace of spending and investment — by consumers, government and businesses — since the Great Recession began in December 2007. Consumer spending has recovered far more slowly than past recoveries. And despite a massive stimulus program in 2010, government spending at all levels is actually lower than when the Great Recession hit. (Read more from “Is the US Economy Running out of Gas?” HERE)
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The World Can’t Afford Another Financial Crash – It Could Destroy Capitalism as We Know It
By Allister Heath. They bounce back after terrorist attacks, pick themselves up after earthquakes and cope with pandemics such as Zika. They can even handle years of economic uncertainty, stagnant wages and sky-high unemployment. But no developed nation today could possibly tolerate another wholesale banking crisis and proper, blood and guts recession.
We are too fragile, fiscally as well as psychologically. Our economies, cultures and polities are still paying a heavy price for the Great Recession; another collapse, especially were it to be accompanied by a fresh banking bailout by the taxpayer, would trigger a cataclysmic, uncontrollable backlash.
The public, whose faith in elites and the private sector was rattled after 2007-09, would simply not wear it. Its anger would be so explosive, so-all encompassing that it would threaten the very survival of free trade, of globalisation and of the market-based economy. There would be calls for wage and price controls, punitive, ultra-progressive taxes, a war on the City and arbitrary jail sentences.
For fear of allowing extremist or populist parties through the door, mainstream politicians would end up adopting much of this agenda, with devastating implications for our long-term prosperity. Central banks, in desperation, would embrace the purest form of money-printing: they would start giving consumers actual cash to spend, temporarily turbo-charging demand while destroying any remaining respect for the idea that money needs to be earned. (Read more from “The World Can’t Afford Another Financial Crash – It Could Destroy Capitalism as We Know It” HERE)
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