Danielle DiMartino Booth: $250 Trillion Global Debt Will Not Be Forgiven Willingly
- Danielle DiMartino Booth: $250 Trillion Global Debt Will Not Be Forgiven Willingly
by Greg Hunter’s USAWatchdog.com (Early Sunday Release)
Former Fed insider Danielle DiMartino Booth is not optimistic for a prosperous New Year in 2019. DiMartino Booth explains, “We could easily see a very sharp decline in the first quarter in economic output. We have had a lot of companies and firms do what we call ‘panic buying’ because of the potential raising of tariffs on Chinese goods from 10% to 25%. So, we had a lot of supply pulled forward. There is not a lot of demand on the other end of that for this tremendous inventory restocking cycle we just went through. Then companies are going to slam on the brakes and stop buying in the first quarter. That could really be detrimental to economic health. . . . If (Fed Head) Jay Powell sees the real economy slowing, then I believe he will pause this tightening campaign in early 2019.”
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The other big problem DiMartino Booth points to is the staggering “$250 trillion in global debt.” Would it take a big recession to blow it all up? DiMartino contends, “You don’t need a lot to let the credit genie out of her bottle. When you are looking at $8.6 trillion in debt globally with negative interest rates, that means your runway is very, very short. You could set off a bomb . . . in the European banking system. It never cleaned up to the extent as American banks. The financial system is as interconnected as it was (in 2008) . . . and we don’t know how risk would play out. We do know that we are interconnected enough for a hiccup in one country to have global ramifications. . . . My fear is much more based in China as well as a United States economy that is clearly slowing at this point.”
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