The Pain of This New Economic Downturn Is Starting to Show up All over The Country
The comments below are an edited and abridged synopsis of an article by Michael Snyder
It will take a miracle for the US economy to pull out of the current tailspin, because the economic numbers are deteriorating rapidly. Last week’s numbers were just as bad as expected. But even before that, all of the data said the same thing. The New York Fed’s Empire State manufacturing index suffered the worst 1-month decline ever, Morgan Stanley’s Business Conditions Index suffered the largest 1-month decline ever, global trade numbers are the worst since the last recession, and there is a bloodbath in the US trucking industry.
So it shouldn’t have been a surprise that new home sales in the US were down a startling 7.8% in May, and consumer confidence is rapidly declining. The numbers add up to precisely what we would expect to see during a recession.
Yet there are media reports that insist the US economy is doing well. FedEx didn’t get that memo; it reported a loss of $1.97 billion in the fiscal fourth quarter. It blamed this awful number on the global economic slowdown.
Many in the media speak of the next recession as a future event, but when we get the final economic numbers many months from now, we may discover that it started sooner than anticipated. Even Fed Chair Jerome Powell says that the economic outlook has become cloudier.
Meanwhile, the global trade war continues to intensify, and it isn’t likely to end any time soon. A war could start in the Middle East, and if that happens, the current economic problems will escalate.
The US economy is beginning to spin out of control. Perhaps the Fed will be able to pull off a miracle, but it’s doubtful. We haven’t seen conditions like this since the financial crisis of 2008. The remainder of 2019 will be interesting.