Economists and other financial experts are warning that, despite current positive indications, the economy is likely headed for a major crash. President Trump has claimed credit for what he sees as a booming economy, but despite current positive economic indications, experts see other factors that are raising alarm bells.
Several factors are raising warning signs for experts. Among those factors are student loan debt that is growing at an astronomical rate, and increasing household debts. The combination of these negative factors has caused some experts to predict an economic crisis “worse than the Great Depression.”
Goldman Sachs is among those warning of an impending financial crash. The major financial institution has predicted that US fiscal outlook for this year is “not good.” That assertion is based in part on the growing household debt, that has been rising since the housing crisis in 2008.
Other issues that are expected to be detrimental to the United States economy are the growing national debt and low wages. Experts also point to a $247 trillion global debt as being a potential cause of a debilitating financial crisis.
One expert pointed to recent slowdowns in auto and house sales as a first step toward recession. Experts do not anticipate the positive economic conditions that currently exist to be sustainable through President Trump’s first term in office.
Murray Gunn is the chief of global research at Elliott Wave International. Gunn explained, “We think the major economies are on the cusp of turning into the worst recessions we have seen in 10 years. Should the [U.S.] economy start to shrink, and our analysis suggests that it will, the high nominal levels of debt will instantly become a very big issue.”
Two major areas of concern are household debt, that is far higher now than it was at the worst point of the 2008 recession. That debt is due to mortgage lending. Also, student loan debt has increased dramatically. Similarly, unpaid credit card debt is currently at highs not seen since the height of the Great Recession.
Peter Schiff is an economic commentator who warned of the coming financial crisis explaining, “We won’t be able to call it a recession, it’s going to be worse than the Great Depression.” He added, “The U.S. economy is in so much worse shape than it was a decade ago.”