Several of the world’s leading businessmen recently expressed their opinions and prognoses regarding the now-palpable specter of recession looming over the United States economy.
Amazon’s Jeff Bezos, in particular, warned people to “batten down the hatches” and get ready for the worst. Bezos specifically pointed out how economic growth has slowed down considerably, not only in the US, but across the globe as well. A number of industries have downsized their workforces in light of current developments and current events have continued to hinder the flow of products and services the world over.
Meanwhile, Nouriel Roubini, the New York University economist infamously known as “Dr. Doom” for his dire yet accurate forecasts about the industrial and financial sectors, wants people to learn their lessons from history. Roubini explained that, at this point in time, a hard landing into a full-blown economic recession is now unavoidable. In Roubini’s recession scenario, an event that he refers to as the Great Stagflationary Debt Crisis will play out, putting the global economy in a worse place than it was in the 1970s or at the height of the global financial crisis of the late 1990s.
What’s Driving the US into a Recession?
These nightmare scenarios are not without basis. Indeed, a number of financial experts, analysts, and industry professionals point out that a recession has been brewing for some time now, fueled by a number of socio-economic and even political factors.
Omega Advisors CEO Leon Cooperman, for one, cites the perfect storm caused by the Federal Reserve’s tightening anti-inflation measures, a dollar on a rampage, and the rising price of oil as the match which has lit a slow burn towards recession. As he puts it, the US pulled demand forward because of a number of uncalled-for fiscal and monetary policies; now, the economy is set to pay the price.
Carl Icahn, chairman of Icahn Enterprises, echoed Cooperman’s sentiments. He likewise pointed out that, if presented as a graph, US interest rates will appear with an inverted yield curve as Treasury yields are currently pegged at around 5%. This, in Icahn’s opinion, is a sign that the US economy is already in the throes of a recession, but he expressed hopes that those in authority can consider a number of measures to turn the economy around.
But not everyone shares Icahn’s scant optimism. Indeed, other prominent business experts feel that this could be a protracted recession and they expect it to peak by the middle of next year.