Economist John Williams has a dire prediction for the U.S.
dollar. Williams says, “I don’t see what will save it at this point. . .
. Now we are to the point that the dollar has been ignored for years.
The federal deficit has been ignored for years. . . . That’s what we are on the brink of disaster with, and that is what has to be addressed now, and that’s not happening.” Williams also contends, “The
way I see it, the dollar could go to zero in terms of its purchasing
power. You don’t want to have your assets in U.S. dollars.” How
are we going to get there? Look no further that the dismal first
quarter gross domestic product (GDP) numbers that officially only eked
out .1% growth. This is one of the reasons why Williams thinks a
“renewed broad economic downturn continues to unfold.” Williams goes on
to say, “We’re turning down a new. The first quarter should be revised
to negative territory, and I believe the second quarter will be
reported negative as well. That will happen by July 30 when you have
the annual revisions to the GDP. In reality, the economy is much weaker
than that . . . . Generally, when you adjust for inflation and you use
too low of a rate for inflation, that overstates the economic growth.”
Williams says the government rigs the economic numbers, and it gives a false impression of recovery. When you remove all the accounting gimmicks, Williams says, “Starting with the recession that started with the end of 2007. . . . in reality, it was more of a plunge and then stagnation. . . . What we’re seeing is we’ve been stagnant and bottom bouncing and maybe a little bit higher, but we are turning down again. The reason for this is the consumer is strapped and doesn’t have the liquidity to fuel growth in consumption. Median household income, net of inflation, is as low as it was in 1967. The average guy is not staying ahead of inflation. For decades, you could get consumption from the future by borrowing more money and expanding your debt. That all blew apart in 2007 and 2008. Now, you don’t have the ability to borrow money the way you used to, and without that, there is no way consumption can grow faster than the rate of inflation. . . . There is no way you can have positive sustainable growth in the economy without the consumer being healthy. It’s just not going to happen.”
Click here to read the rest of Greg Hunter’s write-up and to access the active comment section.
Williams says the government rigs the economic numbers, and it gives a false impression of recovery. When you remove all the accounting gimmicks, Williams says, “Starting with the recession that started with the end of 2007. . . . in reality, it was more of a plunge and then stagnation. . . . What we’re seeing is we’ve been stagnant and bottom bouncing and maybe a little bit higher, but we are turning down again. The reason for this is the consumer is strapped and doesn’t have the liquidity to fuel growth in consumption. Median household income, net of inflation, is as low as it was in 1967. The average guy is not staying ahead of inflation. For decades, you could get consumption from the future by borrowing more money and expanding your debt. That all blew apart in 2007 and 2008. Now, you don’t have the ability to borrow money the way you used to, and without that, there is no way consumption can grow faster than the rate of inflation. . . . There is no way you can have positive sustainable growth in the economy without the consumer being healthy. It’s just not going to happen.”
Click here to read the rest of Greg Hunter’s write-up and to access the active comment section.
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