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Kudlow: ‘It Will Be Hard to Escape a Recession’
Breitbart ^ | 05/05/2022 | Trent Baker

Posted on 05/05/2022 9:09:03 AM PDT by ChicagoConservative27

In the wake of Federal Reserve Chairman Jay Powell’s announcement that interest rates would be raised by 0.5%, Fox Business Network host Larry Kudlow on Thursday warned that the U.S. economy was “in trouble.”

Kudlow, appearing on Fox News Channel’s “America’s Newsroom,” said it was going to be “hard to escape a recession” in the coming years.

(Excerpt) Read more at breitbart.com ...


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: economy; escape; fed; fedrate; hard; kudlow; recession; stockmarket
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To: Starboard
They can't.

They are out of options.

This is macro economics 101: https://www.investopedia.com/ask/answers/08/guns-butter.asp

But instead of guns and butter. It's guns, butter, Covid stimulus checks, massive expanse of social programs, corporate cheese (so called infrastructure and green programs) on one side... The US has a big economy. But even it has limits.

https://schiffgold.com/wp-content/uploads/2021/03/tms-money-supply.png

Massive government spending and a vast increase in money supply has created inflation. If the Fed doesn't raise the rate, this inflation gets even worse, which also has bad economic consequences... The retards in charge (all with big degrees, big titles, making a lot of money, and with many years of government “service”) have led us into a bad place where our options are: “bad or worse.”

Yes, we the USA have become a joke.
We are right up there with some Caribbean state:
https://en.wikipedia.org/wiki/Mexican_peso_crisis

The recession is coming. By definition if we have another quarter of the economy shrinking we will be in a recession. Unless the government changes the definition or measures, they like to lie like that (why unemployment numbers are BS today, why GDP is BS today... all these numbers have been skewed over time by changing definitions and how things are counted).

21 posted on 05/05/2022 10:55:54 AM PDT by Red6
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To: aquila48
People are still spending like there’s no tomorrow.

Many young people do believe there's no tomorrow. Can't blame them for thinking that. But... there's been doom and gloom myths going on in every generation. I'm spending because of inflation, and goods will be more expensive later - but I'm not broke like young people. Fixer-upper homes going on the market here at $1.2M and selling within a week - can't blame young people for giving up on tomorrow.

22 posted on 05/05/2022 1:04:17 PM PDT by roadcat
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To: ChicagoConservative27

It’s already here for my family!


23 posted on 05/05/2022 1:21:42 PM PDT by Iron Munro ( Joe Biden - Inventor Of The First New Language since Esperanto)
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To: Red6

Powell is no Volker. He doesn’t have the resolve to cause the necessary degree of financial pain to cut inflation. This is a daunting task that’s being complicated by a lot of factors (too many to list in a brief post).

He’ll raise rates for awhile but lose his enthusiasm for it once the consequences become politically and popularly too difficult for him to cope with. Escalating interest rates are going to cause a LOT of pain. Remember too, the Fed doesn’t like to have the appearance of doing things that might be perceived as interfering with our elections, and that is exactly what will happen when rising interest rates kick off a recession at a very inopportune time. Powell is a bind of his own making.


24 posted on 05/05/2022 3:13:53 PM PDT by Starboard
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To: Starboard

And that’s why I like FR.

Good points.

https://en.wikipedia.org/wiki/Jerome_Powell

https://en.wikipedia.org/wiki/Paul_Volcker

Volcker came back to my mind when I looked him up. I remember that name from a few media reports in the past and my economics course at college in 1991.

BTW, if you do go into depth, some of us will read it.


25 posted on 05/05/2022 3:43:53 PM PDT by Red6
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To: carriage_hill

Great move stay stocked have strong doors.


26 posted on 05/06/2022 7:16:33 AM PDT by Vaduz ( )
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To: Red6

BTW, if you do go into depth, some of us will read it.

***************
I hadn’t read this article before I posted but it expresses a lot of my sentiments so I’ll try not to repeat anything.

https://seekingalpha.com/article/4507893-fed-new-tightening-plan-too-little-too-late#comment-92266064

Save for the Volker era, the Fed’s track record certainly doesn’t inspire much confidence. Right now it is way behind the curve and is being reactive. Don’t be surprised if the Fed starts moving the goal posts for its inflation targets.

I doubt there are many people who thought the Fed’s balance sheet would ever approach $9 trillion. That is equivalent to 1/3 of the nation’s debt. But that’s where it is now. How do you unwind that massive amount of securities without disrupting markets? But I digress.

Inflation is currently much higher than the official number. Everyone in the country knows that but the Fed persists in the notion that its lower and transitory. If you accept the reality that the real rate of inflation is up in the teens the magnitude and difficulty of the Fed’s task becomes apparent. When you allow a problem to grow it only becomes harder to remedy.

The Fed’s reduction of QE is way to mild and illustrates how reluctant it is to do what is necessary. And what happens when raising rates (1) start causing unemployment to rise, (2) pushes the country toward recession, and (3) begins destroying peoples’ 401k’s and retirement assets. There is no way Powell will have the fortitude to stand up to those kind of pressures, especially during an important election year.

Given the dire alternatives the Fed will be happy to let inflation run. It does, after all, make it easier to the government to manage its debt.

It not hard to foresee that the Fed will back off its “commitment” to fight inflation.


27 posted on 05/07/2022 10:27:28 AM PDT by Starboard
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