A debt crisis is coming! The "Debt King" warns that the United States will enter an economic recession next year
海角七号
发表于 2023-11-9 10:17:31
289
0
0
As high interest rates have pushed up the borrowing costs of the US government, the annual interest expenditure on US debt has soared to more than $1 trillion last month. This situation has also caused an increasing number of market participants to sound the alarm bell.
On Wednesday Eastern Time, Jeff Gundlach, the "debt king", stated in an interview that the US $33 trillion debt mountain is becoming increasingly worrying and the US economy may fall into recession at some point next year.
High interest rates will lead to economic recession
Gunlak warned that under the pressure of a high interest rate environment, the United States may find it difficult to avoid an economic recession. He said, "My belief is that we are about to enter a recession, and if we have not yet entered a recession, we may enter a recession in the second quarter of 2024
He also added, "Our lives are all linked to low interest rates. Now, we are aware of the consequences of high interest rates, and the idea that we will avoid an economic recession has become weak
Given concerns about economic recession, Gonlac is not optimistic about the US technology giants, known as the "Magnificent Seven" - Apple, Microsoft, Google's parent company Alphabet, Amazon, NVIDIA, Tesla, and Meta - in terms of investment advice, despite their recent good performance.
He believes, "In the upcoming recession, they (the Big Seven) are clearly the worst performing. No matter who leads into the recession, they will inevitably lead when the economy declines. I want to stay away from them and choose an equal weight basket instead of a market weighted basket. I will definitely leave the US banking system
Interest on US debt is growing explosively
Gunlak also emphasized the serious impact of a high interest rate environment on the US fiscal situation.
He said, "The reason why I am worried that high interest rates will continue for a longer time is already clear, which is our financial situation, but this issue has not been given enough attention. The interest expenditure on debt is growing vertically
He warned that in an economic recession, fiscal issues will become more severe, as changes in the economic environment will clearly have a significant impact on the fiscal situation. Once the US fiscal situation deteriorates further, it may lead to inflation.
Gunlak predicts that this may ultimately push the US fiscal deficit from 6% to 8% of GDP to 9%, while a larger deficit may exacerbate inflation and lead to a rise in Federal Reserve interest rates in the second half of 2024.
Gunlak also mentioned the burden that high interest rates bring to small and medium-sized enterprises in the United States: We are facing a huge problem because low interest rates have been maintained for so many years, almost a decade, and now the Federal Reserve has raised interest rates for a longer period of time. This also affects small businesses, who used to only need to pay 4% interest rates, but now they need to pay 9% or even 12% interest rates. If our interest rates continue to be higher, it will obviously bring more serious problems
Gunlak warned that the US debt figure is approaching a critical point.
Five years from now, assuming our interest rates are higher and longer in duration, with a 6% interest rate and a deficit of 9% of GDP, 50% of all tax revenue will be used to pay interest. Of course, this is not possible because 70% of the budget is mandatory, "Gunlak quoted the Congressional Budget Office's forecast, We are really close to that moment, we senior colleagues have been talking about it for decades. We are basically at a moment where this is not a problem for our grandchildren, not for our children, but for ourselves
CandyLake.com 系信息发布平台,仅提供信息存储空间服务。
声明:该文观点仅代表作者本人,本文不代表CandyLake.com立场,且不构成建议,请谨慎对待。
声明:该文观点仅代表作者本人,本文不代表CandyLake.com立场,且不构成建议,请谨慎对待。
猜你喜欢
- The transfer of personal credit card debt from Citibank to Fubon Huayi has been completed
- Late night bearish news for American retail giants! The sincerity and money of the acquirer are not enough, and the stock price of Macy's plummeted
- Which industries would benefit from the uncertainty of the United States general election and the certainty of the Fed ' s interest rate reduction? International
- The Federal Reserve awakens the alarm: US household debt has risen to record levels
- The Pentagon suddenly spoke up! Allow Ukraine to use American made weapons to counterattack Russia
- The next government is under immense pressure! US debt interest burden hit a 28 year high
- Global Focus Next Week: Super Financial Report Week Arrives, Multiple Countries Release Third Quarter GDP, Focus on US Non farm payroll in October
- Behind the abnormal sell-off of US Treasury bonds: Has a debt crisis begun to emerge?
- Global Vice President of JinkoSolar: Photovoltaic will be the main energy source for sustainable development
-
苹果知名分析师郭明錤周四(10月31日)在社交媒体上发文表示,苹果明年可能会减少对芯片制造商博通Wi-Fi芯片的依赖,并推出自己的处理器。 郭明錤在社交媒体平台X上写道,“在2025年下半年的新产品(例如iPh ...
- uturn
- 昨天 14:42
- 支持
- 反对
- 回复
- 收藏
-
10月30日,小鹏汽车生态企业小鹏汇天宣布,旗下分体式飞行汽车“陆地航母”即将亮相2024中国航展,11月12日将在中国航展第二展区(斗门莲洲)进行全球首次公开飞行,同时“陆地航母”也将在珠海国际航展中心8号 ...
- yxtianyouyou
- 前天 11:43
- 支持
- 反对
- 回复
- 收藏
-
交易所监管文件显示,当地时间11月1日,亚马逊创始人杰夫·贝索斯拟出售约1635万股亚马逊股票,预计套现约30.5亿美元。今年7月,贝索斯已申请额外出售约2500万股亚马逊股票,按当时股价计算可套现约50亿美元。 ...
- blueskybb
- 11 小时前
- 支持
- 反对
- 回复
- 收藏
-
近日,凯撒海湾目的地(山东)运营管理有限责任公司(简称“凯撒海湾”)与携程旅悦集团签署战略合作协议,双方将围绕“海上目的地运营”、“旅游产品与服务创新”、“研学旅行”、“日韩及海外旅游市场开拓”等 ...
- llyyy2008
- 9 小时前
- 支持
- 反对
- 回复
- 收藏