Reference News Network reported on September 17 that
according to foreign media observations, as economists from the Federal Reserve to major Wall Street companies have made predictions about a series of unknown factors such as the direction of the epidemic and whether Congress can reach a compromise on spending issues, they have an outlook on the U.S. economy. The outlook of the United States has drawn very different results, namely: a year later, the United States may have come out of the economic difficulties caused by the new crown pandemic, the growth rate is significantly higher than the previous trend, and the output has basically recovered; or it It may be still working hard to repair the US$2 trillion economic stimulus plan, growth has stagnated at a low level, the new crown pneumonia crisis continues, and people face long-term unemployment.
According to a report from Reuters on September 15 in Washington, completely different forecasts prevent decision makers from obtaining reliable advice to find the best answer to the problem.
Before further clarifying what measures need to be taken and how long they will last, the Fed has been reluctant to announce new measures to support the economy.
Analysts at Cornerstone Macro Consulting wrote that when Fed officials meet this week, they are not expected to take policy measures, partly because of "very uncertain economic prospects."
They pointed out: "Calibration in this situation is extremely challenging."
According to the report, what makes matters worse is that, as the broadest measure of economic activity, the rebound in gross domestic product (GDP) may be out of touch with the recovery of the job market, resulting in millions of unemployed Americans even if economic growth is better than expected. I can't feel this recovery at all.
In fact, since the 1990s, as companies reorganized to reduce the use of workers and waited for demand to fully recover before hiring, the job market has rebounded from the recession much more slowly than GDP.
Millions of people are now unemployed in disadvantaged industries such as tourism, catering, and hotels, and business organizations may change after the epidemic. This time the unemployed may take longer to find a new foothold.
The report pointed out that compared with the level in February, the US economy currently has lost approximately 11 million jobs.
During the economic recession from 2007 to 2009, it took more than four years for the United States (that is, until mid-2014) to recover the 8 million jobs lost during the recession.
But this recovery is obviously different.
The US economy has added more than 10 million jobs in the past four months, which surprised many policymakers.
As of August, the unemployment rate of 8.4% was lower than the median year-end forecast of 9.3% predicted by Fed officials.
Economists do believe that when the federal government announces its preliminary GDP estimates for July-September this year next month, it may break growth records, just like the record contraction of GDP from April to June.
But beyond that, their opinions were divided.
The disagreement is not based on models or mathematical calculations, but on how they interpret the political wind and how they predict the success of the new crown vaccine.
Assuming that Congress approves another $1 trillion economic stimulus plan, companies rebuild inventories, and vaccines go online early next year, then Goldman Sachs predicts an annualized GDP growth rate of 35% from July to September, after which the economy will maintain stable growth. The outbreak quickly climbed to the level before the outbreak.
Daniel Buckman, a senior manager at Deloitte, wrote in the report that if there are no economic stimulus measures, slow deployment of vaccines, and household and local government bankruptcies leading to weak consumption, then "the economy will never be able to return to the trend line before the epidemic."
He is one of the few analysts who predict that the current recession will bring a permanent economic shock.