US economy suffers worst decline as GDP contracts by 32.9% in the second quarter

[Juggy777]

I don’t think anyone here will be surprised to read this that the US GDP has contracted by 32.9% in the second quarter, as we all know that this is the after effect of covid19, but what worries me is whether the US economy can actually bounce back this year, or even next year as Trump had claimed that the economy will definitely bounce back. Further in more worrying news the jobless claims has risen to 1.43 million people, and this figure doesn’t look good for the US economy in the long run. Lastly with Covid19 yet wrecking havoc on US economy what chances do you see of its recovery in light of these numbers?.

Sources:

https://www.independent.co.uk/news/world/americas/us-economy-gdp-latest-coronavirus-trump-pandemic-a9645881.html

https://www.wsj.com/articles/us-economy-gdp-report-second-quarter-coronavirus-11596061406

https://www.forbes.com/sites/simonconstable/2020/05/28/look-out-democrats-the-economy-is-looking-better-for--trump-than-you-think/#3f1516e839bc

[cryptoaddictchie]

but what worries me is whether the US economy can actually bounce back this year, or even next year as Trump had claimed that the economy will definitely bounce back.

Definitely not this year and not sure until the next one. We all knew US is a strong country. But trump words is merely a promise which can be true or not. I dont know but their economy has depleted fast and it will attribute to Trump's actions regarding covid19 scenario. He did a poor piss job to prevent it.

Lastly with Covid19 yet wrecking havoc on US economy what chances do you see of its recovery in light of these numbers?

Maybe there is if the next President of US has a better solution. Their country is still one of the powerful in the world and only a great leader is needed to make it great again in spite of these worst scenario happening.

[ray_saeed]

This virus will kill much more people due to economic impact, not medical

[davis196]

The US economy(and every other economy in the world) will bounce back only after the pandemic ends.
Unfortunately the pandemic is here to stay and I assume that it will end after most of the world population gets infected with coronavirus and survives that illness,so the pandemic might continue for 2-3 years.
The 32.9% decline looks scary,but the US economy was on steroids due to the massive money printing,so I assume that such rapid decline is kinda normal.The economic growth of the US from the previous years was more or less artificial.

[DoubleEdgeEX]

It sounds aweful. but obviously it isn´t for some. Check out that profits: https://www.youtube.com/watch?v=aoR5sniTnv4

The situation and setup looks to me like another attempt to destroy the middle class and SMEs, pushing the distribution of wealth even more out of balance. Debt discharge and easy to get low interest loans will revive most bigger businesses in 2021, but the smaller ones will perish if they don´t adapt to the situation (if they can).

[so98nn]

There are more things which gonna affect the US economy in the long run.

US is not handling the situation of covid19 in greater ways and it will lead to more chaos in terms of businesses and jobs. They have to handle their money flow that is spent on the security and military personnel of USA thus making it worst over the time since billions are actually spent over WAR rather than HEALTH industry.

According to the latest news, we will have vaccines for covid19 by December to January 2021 meanwhile making the US situation two to three fold worst! (over 6 months)

Once the vaccine is out US will have to spend lot of money to buy vaccines in the first place and have vaccination campaigns throughout the nation. It costs hell lot of money and I am afraid US will already have gotten into worst GDP that could be possible.

So definitely GDP isn't gonna recover this year for USA.

[Upgrade00]

Trump's promises were merely political in my view and a bid to instill voter confidence as elections draw near. So much damage has already been done to businesses and as such there has to be a period of recovery where the market normalises (or the economy ceases to contract), after which, the nation can enter a period of economic expansion. Which is the phase the U.S has been in since the last recession.

The economic decline is the direct result of the effect of a pandemic, so trying to flatten the curve is one of the best routes to rebuilding the economy and not pumping more money into the market. Although this is needed to keep businesses afloat, but needs to be done in hand with slowing the spread of the virus and it also needs to be done holistically; injection funds into select businesses could create a greater gap between classes and further hurt the economy to the gain of a few.

[enhu]

The US economy(and every other economy in the world) will bounce back only after the pandemic ends.
Unfortunately the pandemic is here to stay and I assume that it will end after most of the world population gets infected with coronavirus and survives that illness,so the pandemic might continue for 2-3 years.
The 32.9% decline looks scary,but the US economy was on steroids due to the massive money printing,so I assume that such rapid decline is kinda normal.The economic growth of the US from the previous years was more or less artificial.

That's one problem with this virus, its not going anywhere which will really make every country's economy crumble to pieces including US. And then there is a threat about China going full steam to thier economy which likely going to make them the strongest around. It would be easy for US to just keep printing while they still can than gonna be crushed.

Its economy is fueled by war but there ain't gonna be war goingto happen unless they can lure Iran to shoot first or probably China which can literally crush thier economy. They got to find another way to make thier economy alive again.

[exstasie]

I don’t think anyone here will be surprised to read this that the US GDP has contracted by 32.9% in the second quarter

Atrocious numbers, worse than many analysts had anticipated. Yet it seems like the markets had already priced it in anyway. As soon as the news dropped, S&P 500 futures rallied ~2% over the next 8 hours.

It's becoming very typical now: terrible economic news keeps triggering rallies!

I guess that's how things work now that the Fed has proven they can just pump the markets to infinity.

[ultrloa]

The US economy(and every other economy in the world) will bounce back only after the pandemic ends.
Unfortunately the pandemic is here to stay and I assume that it will end after most of the world population gets infected with coronavirus and survives that illness,so the pandemic might continue for 2-3 years.
The 32.9% decline looks scary,but the US economy was on steroids due to the massive money printing,so I assume that such rapid decline is kinda normal.The economic growth of the US from the previous years was more or less artificial.

That's one problem with this virus, its not going anywhere which will really make every country's economy crumble to pieces including US. And then there is a threat about China going full steam to thier economy which likely going to make them the strongest around. It would be easy for US to just keep printing while they still can than gonna be crushed.

Its economy is fueled by war but there ain't gonna be war goingto happen unless they can lure Iran to shoot first or probably China which can literally crush thier economy. They got to find another way to make thier economy alive again.

The best thing they could do is to discipline their citizens first since if everyone will follow the protocol for sure they will not suffer to much from huge economic recession, look at what happen on other countries they manage to handle covid-19 nicely and their lives came back to normal. Maybe they will learn a big lesson after this pandemic since in early days they are downplaying this and for this huge suffering they will surely know on what is the next actions for economic counteractions.

[mu_enrico]

I have read many articles stated the same situation across countries, isn't it predictable?

Anyways, I'm still sure we will bounce back globally in about Q1 2021

I voted for Q1 2021

The vaccine will be the main reason we will quickly bounce back to the "old" normal. It's already on phase three (for some brand)!

[Husires]

The analogy with the results for the second quarter of this year will give us inaccurate results. The global closure was a reason for the slowdown in global growth and many economic distortions.
The bounce will be rapid before the end of next year, but the economic distortions that took place need a lot of time to restore and make them before 2020.

[plvbob0070]

If the number of cases in the US will continue to increase within the next months, I doubt that their economy will be able to recover within this year. However, the US can easily recover once this pandemic is done, but since the country is not showing any good sign in fighting the virus, it's like they will highly depend on the vaccine for the fast recovery of their economy.

But aside from the economic decline, I'm worried about the population if this virus will continue to spread. I mean, it's not a big percentage compare to the whole population, but the fact that already 100k+ of people died because of this in the US alone is a threat if it will last longer.

[ultrloa]

If the number of cases in the US will continue to increase within the next months, I doubt that their economy will be able to recover within this year. However, the US can easily recover once this pandemic is done, but since the country is not showing any good sign in fighting the virus, it's like they will highly depend on the vaccine for the fast recovery of their economy.

But aside from the economic decline, I'm worried about the population if this virus will continue to spread. I mean, it's not a big percentage compare to the whole population, but the fact that already 100k+ of people died because of this in the US alone is a threat if it will last longer.

Year is nearly ending so its a though job for them to recover what they lost during this pandemic but its hard to think how deep they can go since even up till now they are been much affected by this pandemic and worse scenario on them is some of their people still under estimating the virus.

But we know the america is great so provably they will recover since they still ha e resources compares to the countries who are in 3rd world since for sure they will struggle to stand up after this covid ends.

[Argoo]

The US economy is special in the sense that the dollar is not backed by commodities and foreign exchange reserves, and at the same time, the dollar is used as a currency throughout the world. Therefore, the United States can artificially improve its economy by uncontrolled printing of paper dollars. In the United States, they have long been living beyond their means and in fact in debt. However, by printing dollars, they can quickly rectify the situation.
It will be much more difficult for other countries to get out of the actually begun economic crisis.

[Febo]

I don’t think anyone here will be surprised to read this that the US GDP has contracted by 32.9% in the second quarter, as we all know that this is the after effect of covid19, but what worries me is whether the US economy can actually bounce back this year, or even next year as Trump had claimed that the economy will definitely bounce back.

If all will go well recovery should happen in 2022. It is totally impossible to recover this year. It is highly unlikely to see a recovery until end of next year. Yes some countries will recover already next year. Countries like China or some other fast growing smaller countries. USA and EU will recover in 2022. But only if all will go fine. If vaccine will be found fast and we will not fall into depression.

[audaciousbeing]

I don’t think anyone here will be surprised to read this that the US GDP has contracted by 32.9% in the second quarter, as we all know that this is the after effect of covid19, but what worries me is whether the US economy can actually bounce back this year, or even next year as Trump had claimed that the economy will definitely bounce back. Further in more worrying news the jobless claims has risen to 1.43 million people, and this figure doesn’t look good for the US economy in the long run. Lastly with Covid19 yet wrecking havoc on US economy what chances do you see of its recovery in light of these numbers?.

Sources:

https://www.independent.co.uk/news/world/americas/us-economy-gdp-latest-coronavirus-trump-pandemic-a9645881.html

https://www.wsj.com/articles/us-economy-gdp-report-second-quarter-coronavirus-11596061406

https://www.forbes.com/sites/simonconstable/2020/05/28/look-out-democrats-the-economy-is-looking-better-for--trump-than-you-think/#3f1516e839bc

Whether next year or next quarter, the economy would continue to shrink or recover on a slowing rate that could longer for years except there is a sustainable way to manage the economy and countries get to do away with all of these proactive means of managing the crises. Vaccines development or drugs development that makes one immune to the virus that could fully open the economy is the only way out of this quagmire.

[abhiseshakana]

The US economy is special in the sense that the dollar is not backed by commodities and foreign exchange reserves, and at the same time, the dollar is used as a currency throughout the world. Therefore, the United States can artificially improve its economy by uncontrolled printing of paper dollars. In the United States, they have long been living beyond their means and in fact in debt. However, by printing dollars, they can quickly rectify the situation.
It will be much more difficult for other countries to get out of the actually begun economic crisis.

Or America can do the simple thing by raising the benchmark interest rate so that it pulls the dollar back to America and this will benefit America and will put pressure on many other countries in the world for experiencing deficits. America as a price maker can also increase the price of gold and increase its gold reserves so that similar cases of subprime mortgages do not happen again.

There is nothing to worry about for America because whatever happens America is still quite resilient and will always come out victorious because of its influence and hegemony as well as a matter of fact the current world system that designs is America, its vital keys are held by America. Many countries object, but what can they do, on the one hand, they need America and do not want to make America a bad boy.

[gentlemand]

but what worries me is whether the US economy can actually bounce back this year, or even next year as Trump had claimed that the economy will definitely bounce back.

There are two economies. There's the toytown markets where anything goes and anything is thrown at it to keep the party going. Then there's the real one where real people get boned every day.

The latter can continue to spiral downwards while the former is coaxed into remaining perky on the surface at least. Things like evictions haven't gotten started yet and there's a whole wave of business death yet to come too.

Nobody knows where this going to end but it's going to get worse and take longer than initially expected.

[odolvlobo]

... the US GDP has contracted by 32.9% in the second quarter...

It must be noted that the actual decline is 9.5% from the previous quarter. The 32.9% number assumes that the 9.5% decline continues for an entire year.