"We have a recession in place. It's just a matter of playing out in some of these other funny numbers. The reality is on the downside, where you have mixed pressures right now. People who are really concerned about the economy right now, and that includes President Trump looking at re-election, he's been arguing that the Fed should lower rates, and I am with him. The Fed created this circumstance. They are pushing for the economy on the upside because they want to continue to keep raising rates. Banks make more money with higher rates, and they are still trying to liquidate the problems they created when they bailed out the banking system back in 2008."
Williams strips out all the financial gimmicks in his work that make things look better than they really are to give a true picture of the real financial health. Take for example the recent reportedly good news of the trade deficit narrowing. Williams says,
"What we saw was the very unusual narrowing of the deficit . . . that's generally good news . . . but if you look at why the trade deficit was narrowing, it wasn't that we were having new surging exports . . . instead, we were having collapsing domestic consumption. People weren't buying things. People were not buying goods. So, the imports were falling off, and that narrowed the deficit. That is not a healthy sign. The last time you saw something like that was the beginning of the Great Recession (2008-2009). . . . We still haven't recovered from the Great Recession."If rate cuts don't happen soon, is the economy going to tank? Williams says,
"The economy is tanking, and I'll contend it already has, although we have not seen it in the GDP reporting. . . . The ultimate thing here is you have a collapse in the dollar. I am talking about a hyperinflationary collapse. Your purchasing power becomes worthless. What you have in gold or canned goods or real estate, that will be your assets - hard assets."In closing, Williams says,
"The underlying weakness is with the consumer. Until the consumer gets turned around, you are not going to get a fundamental change in the economy. The economy is going to get weaker. The Fed is going to recognize that, and they probably already do recognize that. . . . They don't want to lower rates, but I think they are going to have to. I would look for easing by September and maybe quantitative easing (money printing) as the economy continues to deteriorate as it seems to be doing. I know the numbers are not there yet in the headlines, but watch out."There is even more free information and analysis in the recently redesigned Shadowstats.com. If you want more detailed information and original analysis from John Williams, you can become a subscriber by clicking here.
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Do I smell a fear-mongering controlled-opposition rat here ???