Economist and author Ian Winer made the sensational claim on RT America to host Rick Sanchez just weeks after global megabank Deutsche announced that it was to lay-off 18,000 jobs over the next three years. Mr Winer explained: “So, technically, we’re not in a recession. I imagine we will be by Q1 or Q2 of 2020, just based on growth slowing.
“What’s interesting is that you’ve got the Executive Branch, the Federal Reserve and even Congress approving this debt sealing increase, all acting like something bad is coming because they’re all preparing for the worst.
“And you don’t try to weaken the dollar and you don’t try to get the Fed to cut rates dramatically if things are great.”
Stunned, Mr Sanchez asked: “Why are we hearing you say that while we’re hearing the President of the US and many others saying that we’re now experiencing the greatest economy in the history of planet Earth?”
Mr Winer responded: “Well, let me spare you the suspense – someone is bulls***ing the general public.
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“And it is crazy to think of a stock market at all-time highs, an economy that’s supposedly booming and yet you’re all over the Federal Reserve to cut rates even further and to flush more money into the system.
“I get the sense that the pressure is happening because the closer we get to the election the more important it is that the stock market stays here.
“And the Federal Reserve, which has now lost a lot of its independence, is basically saying we will do whatever it takes to keep this expansion going.
“To me, that means they’re putting a floor in the stock market.”
The dollar held near a two month-high on Monday ahead of what is expected to be the first US interest rate cut since the financial crisis this week, while Britain’s rising Brexit uncertainty knocked the pound to a fresh 28-month low.
Most major currencies were keeping moves small ahead of Wednesday’s expected 25 basis point cut by the Federal Reserve, but there was at least some action to fill the void.
US central bankers are expected to lower borrowing costs this week for the first time since the depths of the financial crisis more than a decade ago.
Economists and traders overwhelmingly expect the Federal Reserve to cut its policy rate by a quarter of a percentage point on Wednesday, matching the size of each of the nine rate hikes delivered from 2015 to 2018.
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The big debate at a July 30-31 meeting will be about what comes next, and how to communicate it, Cornerstone Macro economist Roberto Perli said.
Mr Perli expanded: “I bet the statement will … leave the door open to more, to at least another 25 (basis-point cut) down the road.”
But, as for what economic threshold would trigger a further rate cut, he said, “I don’t think they have a clear idea.”