The US economy has a 75% chance of plunging into recession, the chief economist at ABN AMRO Bank warns.
Amsterdam-based Han de Jong says weakening consumer demand will be the decisive factor pushing the US into recession some time next year. He believes a self-reinforcing “vicious spiral” is developing between the real economy and the financial markets; one unlikely to be stopped any time soon. “For now, we are calling for a relatively mild US recession, provided that economic policy, in particular monetary policy, is eased significantly," de Jong says. "However, the downside risks to this mild recession scenario are at least as large as the upside ones.” De Jong notes the housing market ...
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