The US economic system has suffered its sharpest drop within the second quarter of 2020, with GDP plunging greater than 31 p.c because of the Covid-19 pandemic and the following shutdowns.
The host of Financial Replace, Professor Richard Wolff, tells Increase Bust that “super injury” has been achieved, and “we’re solely in the beginning to type out what the consequences are.”
In response to him, the US is already in an “ongoing steady bailout.” Wolff explains that the Federal Reserve shouldn’t be solely printing cash and making it obtainable to banks, which it had achieved earlier than, however can be straight lending to firms.
“It’s shopping for company bonds available in the market straight and not directly.” That signifies that “each company in America is now on life assist from the federal government. Companies are loading up on debt at ranges we’ve by no means seen in America’s historical past,” the economist says.
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