US economy will continue to recover - Powell

[Vishnu.Reang]

Even if the US can borrow huge amounts of money, that will not be the solution to prevent the crisis. I think the US government still figure out how to stimulate the economy to grow as before. The US's impact happens to all countries, and besides searching for the way to solve the economic crises, the government is trying to work hard to prevent the new case. It still needs time to recovery everything, including the economy, even if the vaccine is found. I think that the US will use tight regulations in any sector to prevent the situation from getting worst.

No immediate solution is available as of now. The US seems to be suffering from a double whammy. First of all, they have the largest number of infections in the world (even higher than Brazil and India, and that too by a distance). And secondly, the fatality rate in the US is much higher than what they have in countries such as India and Pakistan. On top of that, things get complicated there because there is a very vocal section of the population which refuses to adhere to social distancing and other precautionary measures.

[michellee]

Right. We will see what will happen with that. But I am not sure if that number will decrease in a short time. Instead of reducing the debt, the US can make its debt bigger in this pandemic. I am just worried about their people who can not survive if the pandemic continues until the next year. The next candidate will have difficult work to make the situations better.

Trump has sanctioned hundreds of billions of USD worth of handouts and huge stimulus packages, to strengthen the economy during the recent months. As a result, the federal debt grew larger. But at the same time, these measures helped a lot of people who lost their jobs during the pandemic. But the question is for how long this situation can go on. Already 6 months have passed and there is no sign of any slowdown in the spread of the infections.

If people can follow the protocols and always take care of themselves, even if the pandemic is not over yet, the government can reduce the number of infections. But people do not follow the rule, and they seem to act as what they want without they think. It is hard learning for the US as a big country, but the US is not alone because other countries face the same problem. And if people realize how important their lives and other people's lives, we can survive until the pandemic is over.

[bitgolden]

There is a good reason to point out that Obama had a huge increase mainly due to the fact that he received a presidency from Bush that literally had a crash, 2008 was the year Obama became president and he took over the white house when all the wall street and everything else was crashing affecting not only USA economy but all around world economy because all the investments overseas was withdrawn as quickly as possible leaving all the markets dry.

So, he was a bit responsible about it because he didn't do anything to cut down from other parts of government to recover that, but he also wasn't the cause, not sure if not being the answer to a problem you didn't created is a good thing but at least it is good to not be the reason for it as well. Famously republicans are worse with economy as always but I am sure that will continue with democrats as well for foreseeable future since it is not recoverable right now.

[wheelz1200]

“I think we will get through this period, maybe with some starts and stops, with reasonable growth but ultimately we’re looking at…a couple of years of relatively high unemployment,” Powell said in a question-and-answer session after his Jackson Hole remarks.

“The part of the economy which involves getting people together, and feeding them — flying them around the country, having them sleep in hotels and entertaining them— that part of the economy will find it very difficult to recover. That is a lot of workers. That is millions of people whose are really going to struggle to find work,” Powell said.

Realistic assessment, and what I've been expecting for a while. Stagnant job growth, a continued transition from full-time employment to 1099 workers where there is growth, and associated rising levels of medically uninsured.......all while the stock market goes to the moon.

Those 3 points nailed it.  The only thing is while job growth might negatively climb over the next year the market is blowing up which makes zero sense.  Eventually the flood of (debt) funding into the US economy will have to be paid for and when the bills start coming in, the market is going to plunge.

[CODE200]

It’s pertinent to focus on his words which clearly mean that we may see some positive movements in the economy, but along with it we should brace ourselves for negative side effects too which shall last way longer than we all had initially hoped for.

Further there’s more bad news for the jobless people as he’s claimed that they’ll not be able to land jobs, and thus they will continue to remain jobless in the long run.

How it can be claimed that the US economy will continue to recover if the case is that even there are positive movements in the economy, they should still be ready and expect for the negative side effects which means that the recovery is still not stabilize and might not continue to come along due to the threat of the negative side effects associated with it.

Also, with regards to the unemployment that might last for a longer period of time, it is really a very sad thing for the jobless people not being able to work because there might still have no availability of job openings which must be resolved first to be able to come up getting into a continuous recovery because if not, people will remain reliant on what the government can give which will slower the process of recovery for people have no sources to spend for themselves.

[jaysabi]

As a big country, the US economy will continue to recover. However, it will not happen quickly because the government needs to clarify first what they prioritize to recover. Not just the US, the other countries will also do the same, and whether it is developed countries or big countries, the process is still running. The recovery process will still run, no matter if the election will coming in November, and no matter who is in charge, they need to continue the recovery.

The advantage with US is that they can borrow huge amounts of money at near-zero interest rates. Now this is some advantage that the other nations can't count on. In the US they already had the first round of economic stimulus. The impact was visible in the economy, as the employment rate grew (although not to the level that they had prior to the pandemic). But a full economic recovery may not be possible until the virus is completely eradicated. Even now, anywhere from 700 to 1,200 new deaths are being reported every day from the United States.

If the US dollar is to retain any type of value integrity, this can't go on forever. It's been decades since the US ran a budget surplus which decreased the deficit at all, and it was short lived and possibly only a fluke as tax receipts swelled in conjunction with the dot com bubble. The US currently takes for granted that ability to sell bonds to finance the debt, but the world's appetite for this bonds will eventually wane as it looks increasingly unlikely that the US is even able to balance the budget, let alone pay down the debt.

[bryant.coleman]

If the US dollar is to retain any type of value integrity, this can't go on forever. It's been decades since the US ran a budget surplus which decreased the deficit at all, and it was short lived and possibly only a fluke as tax receipts swelled in conjunction with the dot com bubble. The US currently takes for granted that ability to sell bonds to finance the debt, but the world's appetite for this bonds will eventually wane as it looks increasingly unlikely that the US is even able to balance the budget, let alone pay down the debt.

I don't think that the demand for treasury bonds from the United States is going down. On the other hand, the interest in them seems to be going up. Average Yield for a 10-year bond is somewhere around 2% right now, and it is declining with every passing year. If the demand is low, then the interest rate should be going up. I agree that having consecutive budget deficits are not good for the economy. But tell me one thing. Among all the UN members, how many countries are having surplus budgets right now? Even countries such as Saudi Arabia are having huge budget deficits.