Chat with us, powered by LiveChat
Notice: Markets are extremely volatile and volume is very high. Thank you for your patience with shipping delays.

Free Shipping!

Menu

10 to 12 Years to Stabilize Post Virus, Worse Than The 2008 Financial Crisis

Global Restructuring
Print Friendly, PDF & Email

EDITOR NOTES: In looking at the unemployment rates and comparing them to the rates during the 2008 financial crisis, J.P. Morgan CIO, Bob Michele, predicts it will take "10 to 12" years to stabilize and get back to pre-coronavirus levels. He is very confident in his 10-12 year timeline.  This is in-line with what the other economists predictions

Top JPMorgan Investment Officer: It Will Take ’10 to 12 Years’ for U.S. Employment Levels to Return

J.P. Morgan Chief Investment Officer Bob Michele predicted it will take 10-12 years after the pandemic for U.S. employment to get back to its pre-coronavirus level, insisting it won’t be as simple as turning the economy back on.

“No, it’s not that simple … it’s going to take years, or longer to get back to where we are, or where we were,” Michele said on Bloomberg when asked if reopening would be as simple as “turning on the lights.”

Michele noted that there was a huge error when predicting unemployment numbers, as millions of Americans are losing their jobs amid the pandemic. He then compared unemployment rates during the coronavirus outbreak to the 2008 financial crisis.

“When you look at the congressional budget office forecast for the end of 2021, they have unemployment at 9 percent, so sure, materially better than where we’re going to peak in the high teens, but during the peak of the financial crisis, unemployment hit 10 percent,” he said. “So even looking out a year and a half from now, we’re still going to be roughly where we were at the peak of the financial crisis.”

Michele questioned what would happen when the Paycheck Protection Program (PPP) runs out of money and predicted that even when the economy reopens, Americans will not be spending the same way they did before the virus hit, which could lead to another round of layoffs.

“One of the things we did was to just predict a downdraft in the second quarter, somewhere around 10 percent, so call it 38 to 40 percent annualized, and say that’s the trough, and then start this journey back up to the longterm trend rate,” he added. “To catch up to the longterm trend rate that’s been in place, call it 1.5 percent, pre-crisis, to fill that output gap, we estimate it will take ten to twelve years.”

Michele noted that it took the U.S. economy 8.5 years to reach the long term trend line following the financial crisis, so he was confident in his projections.

Originally posted on Mediaite.com

IRA-guide

GET YOUR FREE PRECIOUS
METALS IRA GUIDE

  • This field is for validation purposes and should be left unchanged.

All articles are provided as a third party analysis and do not necessarily reflect the explicit views of GSI Exchange and should not be construed as financial advice.

Precious Metals Data, Currency Data , Precious Metals Automated Product Pricing Powered by nFusion Solutions