The co-founder of PayPal, the CEO of Tesla, and the owner of Starlink Internet service, Elon Musk, stated that he believed a recession would likely worsen and last for about 18 more months. He commented that recessions don’t have to be bad and that they typically happen due to a boom going on too long, and then a bust follows. Interestingly enough, FED chair Powell failed to predict inflation. He could not predict recession, although Elon Musk predicted both. One must wonder if the people in charge are trying to do or say the opposite of what is true purposefully?
Powell failed to predict inflation . He failed to predict recession.
Why does he still have his job?
Elon Musk successfully predicted both.
I think Musk must be made the FED chair.
— emini tic (@TicTocTick) May 16, 2022
Musk basically said that money printing was out of control and that this was part of the reason that a recession was likely. Musk stated that a recession would help clear out the terrible companies as they go bankrupt. The ones that are useful and produce valuable things would prosper.
“And there’s certainly a lesson here that if one is making a useful product and has a company that makes sense: Make sure you’re not running things too close to the edge from a capital standpoint,” he continued. “They’ve got some capital reserves to last through irrational times.”
Musk seemed to hint that Biden could be responsible for the recession. “The obvious reason for inflation is the government printed a zillion amount of more money than it had,” he argued. “The government can’t just issue checks for an excessive revenue without there being inflation. Velocity of money held constant.”
This begs whether a billionaire can see a recession coming from a mile away, but our monetary authorities cannot. So what use are our monetary authorities? Carlos Barberena says that he saw an imminent recession but was laughed at for the suggestion. Perhaps Mr. Barberena should be our fed chairman instead.
I was laughed at when I said #recession was eminent. But when a billionaire says it the pundits are quick to print. #Housing & #Tech bubbles bursting again. Keep supporting the failed two-party system & #WYSIWYG #EndTheDuopoly https://t.co/khwQKVsmMW
— Carlos Barberena for U.S Senate (@CarlosforSenate) May 17, 2022
There’s plenty of reason to be concerned that a recession is imminent. With the CPI reaching new highs in April, FED chair Powell will have to double down on rate hikes to prevent out-of-control inflation.
Warning to all bulls, the bear party is just getting started. We are far from oversold conditions.
CPI made a new record high for April, means Powell has to double down on rate hikes. Since January, there has been a slow bleeding, but I expect a waterfall sell-off H2 2022. pic.twitter.com/zBoEpEzhTZ
— HOZ (@MFHoz) May 17, 2022
The US isn’t the only country, however, that’s in hot water when it comes to economics. According to Robin Brooks, former chief FX strategist at Goldman Sachs and Senior Economist at IMF news, the entire globe is on the verge of a recession. He states this is not the time for aggressive monetary normalization from the ECB with charts and stats to back up what he has to say.
We’re on the brink of global recession. We forecast global growth of 2.2% in 2022. All of that is “carry,” i.e. a base effect from COVID recovery in 2021. Global GDP is flatlining. This is no time for aggressive monetary normalization, especially not from the ECB! With @econchart pic.twitter.com/NuBmzLebrn
— Robin Brooks (@RobinBrooksIIF) May 17, 2022
Most can see it, and Mr. Barberena can see it with economists like Mr. Brooks. So why can’t the Fed chair Jerome Powell see this? Further, if it is a global phenomenon, why is our country the only one pretending it doesn’t exist? The Fed chair is in an unenviable position. If Mr. Powell does not raise rates, inflation will tick higher due to continued money printing at the federal level. If Mr. Powell does raise rates, then lending will tighten, and businesses will shutter. This will lead to massive job losses and economic pullback. The Fed chair is literally caught between a rock and a hard place. If it is so easy for billionaires, candidates, and other economists to see that the United States, in particular, is facing a recession, why is Powell afraid to tell us this?
This story syndicated with permission from For the Love of News