Gloomy Economic Outlook: The Fed Cuts The Growth Prospect For The U.S.

by | Mar 21, 2019 | Headline News | 7 comments


While there are plenty of experts out there who will tell us the economy is doing just fine and none of us should worry about a recession, the Federal Reserve slashed the economic growth prospect for the United States. The news seems bleak right now.

Federal Reserve chairman Jerome Powell has said that he doesn’t expect a recession, but he’s saying there will be an economic “slowdown.” According to CBS News, the Federal Reserve kept a key interest rate unchanged on Wednesday and said it doesn’t expect to hike rates for the rest of the year. This is quite a change from the course the Fed was on in December when the central bank expected two rate hikes. The Fed also expects the U.S. economy to expand 2.1%, which is lower than previous projections, which they assumed to be at 2.5%.

“We foresee some weakening, but we don’t see a recession,” Federal Reserve Chairman Jerome Powell said Wednesday in a press conference. In its policy statement, the Fed said that the job market remains “strong” but noted that “growth of economic activity has slowed” since late 2018. The Atlanta Federal Reserve Bank, which provides a so-called “nowcasting” tool to assess current growth, says the economy is growing only growing at a 0.4 percent in the first quarter of 2019.

The Fed also projects one quarter-point rate hike in 2020 and none in 2021, although that could all change. It will stop shrinking its bond portfolio in September as well. That move alone would help hold down long-term interest rates. The Fed’s pause in credit tightening is in response to slowdowns in the U.S. and global economies. It says that while the labor market remains strong, “growth of economic activity has slowed from its solid rate in the fourth quarter.”

But The Fed cannot fix credit exhaustion.

Too many Americans are too far in debt to borrow any more money and that could present some major problems in the economy. With student loan debt, auto debt, and credit card debt at all-time highs, any interest rate hike could devastate a family living paycheck to paycheck, but it could also pop the “everything bubble” many analysts have warned about for several months now.

Despite the recent dip in economic growth, Powell said that U.S. “economic fundamentals are still very strong,” adding that Fed officials “see a favorable outlook for this year.” They expect the unemployment rate to drop from 3.8% to 3.7%.



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    1. GrayEagle48

      ??⭐️⭐️?? Luke 17:28 Likewise also as it was in the days of Lot; they did eat, they drank, they bought, they sold, they planted, they builded;
      An economic collapse prior to the great Tribulation is
      inconsistent with The Ancient Hebrew Scriptures.

    2. JRS

      The Fed stopped raising rates and they don’t expect to raise again until at least the end of 2020. They will stop running down their balance sheet by September. This is the end of the experimental tightening. They found that you can’t taper a Ponzi scheme or it will seize up and crash. This tells me that they are preparing for more QE. As soon as the credit creation looks like it might be taking a dive, they will “ease” again and lower rates to keep the Ponzi going.

      They are not purposely trying to crash the system to make conservatives look bad, as some alternative economic analysts say. They are trying to keep it going as long as possible to make their pockets bulge and turn yours inside out.

      • TheGuy


        YAY or something.

        Fundamentals? PFFFF! Technicals, man. Becuz muh chicken bones said so. Whatever it’s all psychology anyway. If anything proves you can get rich off stupid people, it’s Bitcoin.

    3. Anonymous

      The economy is always either shrinking or expanding.

      It never stands still for very long at a time.

      It’s the long term moving average that indicates the overall direction it is taking, and that is up more often than down and still is.

    4. repr sleepr

      Estimates are coming in on the livestock loss in Iowa and Nebraska. It is estimated that over a million calves have been lost and that does not include the grown cows/steers. Better figure that in during the grocery shopping.

      • rellik

        Real bummer that all those animals were lost. Beyond the business losses, it is a shame to waste so many animals. From loss of feed corn to loss of animals, prices will be going up.

    5. ronna

      The people that matter are doing fine. Those that don’t matter, well, it’s their own stupid actions that are doing them in! The demorats will never learn! (maybe they actually can’t!)

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