New Recession Closer to Depression – John Williams

by Greg Hunter, USA Watchdog Economist John Williams says forget about the so-called recovery, we are headed for recession. Williams contends, “They’ll have a downside revision to this 1st quarter estimate that will take it negative. What we are seeing now is that the outlook for the second quarter is not only weak, but it is also going to turn negative. Two contracting consecutive quarters of GDP give you a recession. So, we have an outlook for recession. This is an economy that I’ll contend that never recovered, and now we are in a new recession . . . in a grand economic contraction. It’s an ongoing economic downturn that we entered into way back in 2005. This is something close to a depression.” What does this mean for the Fed interest rate policy? Williams says, “It’s not what the Fed wants. It’s not what the market wants. All the speculation about the Fed raising interest rates and returning its policies to more normal functioning, which was the basis of dollar strength since last June, that’s gone. It is going to be very difficult for the Fed to raise interest rates with the economy turning down again. You are already beginning to see some downturn in the dollar, which should be reflected in higher oil prices. That will spike inflation, and you should be seeing higher gold prices. Although they are still manipulated, they should be moving a lot higher.” Continue Reading>>>

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