Fun

Fed Chair Powell Warns of ‘Unsustainable’ Budget as US National Debt Crosses $26 Trillion

News Feed - 2020-06-18 03:06:30

Fed Chair Powell Warns of "Unsustainable" Budget as US National Debt Crosses $26 Trillion


In his testimony before the Senate banking committee,Federal Reserve Chairman Jerome Powell warned Congress that the U.S. federal budget has been on an unsustainable path for years. He added that the U.S. economy is facing a deep downturn with “significant uncertainty.”‘Unsustainable Path’


The Federal Reserve chairman testified before the Senate banking committee on Tuesday. While acknowledging that the federal spending is giving the economy a short-term boost during the coronavirus pandemic, he warned Congress that the U.S. economy faces a deep downturn with “significant uncertainty” about the timing and strength of a recovery.


“The levels of output and employment remain far below their pre-pandemic levels, and significant uncertainty remains about the timing and strength of the recovery,” Powell was quoted as saying. He suggested that investors should not overreact to surprisingly good economic data, such as the May retail sales report. The chairman elaborated:The United States federal budget has been on an unsustainable path for years now … the debt is growing faster than the economy, so debt-to-GDP is rising. That is, by definition, unsustainable.


The Congressional Budget Office said that the U.S. deficit soared to $1.9 trillion for the first eight months of the fiscal year, and is expected to hit a record $3.7 trillion this year. The current record for a fiscal year deficit is $1.41 trillion; it was set in 2009.




“Every generation is entitled to spend what it wants to spend on the things it thinks it needs, but it really ought to pay for them, in some sense, rather than passing the bills onto the kids,” Powell continued. “Over time, future generations – our kids and our grandkids – their tax dollars will be going to servicing the debt that we incurred to buy the stuff we wanted when we were in charge.”


While emphasizing that the U.S. has a lot of borrowing capacity, he said: “we need to get back on a sustainable path.” He added that until the public is confident the [covid-19] disease has been contained, “a full recovery is unlikely.”


Congress has recently authorized approximately $3 trillion in spending to respond to the covid-19 pandemic, which includes the $2.2 trillion CARES Act President Trump signed into law in March. Meanwhile, the U.S. national debt also recently surpassed the $26 trillion mark.


What do you think about Jerome Powell’s warning? Let us know in the comments section below.Demand for Charter Cities During Covid-19 Pandemic Grows Exponential - People Desire Semi-Autonomous ZonesNEWS | 8 hours agoVirtual Panda BTM Launched for Colombian Residents: Dispenses BTC, BCH, DAI, and DashNEWS | 1 day agoTags in this storyEconomic Crisis, Fed Chair, Federal Reserve, Federal Reserve Chairman, jerome powell, Recession, senate banking committee, US economy


Image Credits: Shutterstock, Pixabay, Wiki CommonsExchange.Bitcoin.com is making cryptocurrency trading accessible to everyone, anywhere in the world. Spot-markets for Bitcoin, Bitcoin Cash, Ripple, Litecoin and many more digital assets. Start your trading journey today here.Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.Read disclaimer Show comments

News Feed

Bitcoin Is ‘Highly Likely’ In A Supercycle: Expert Explains Why
Este artículo también está disponible en español. Renowned macro analyst Alex Krüger posits that Bitcoin is “highly likely” in a supercycle. Krüger articulated
Bitcoin halving searches on Google is at its highest point ever
Tom Mitchelhill7 hours agoBitcoin halving searches on Google is at its highest point everExcitement around the upcoming Bitcoin halving has seen a continued increase in searches for the term on Google.5606 Total views19
Russia to Decide Between Full Ban and Legalization of Crypto Investments, Trade
Russia to Decide Between Full Ban and Legalization of Crypto Investments, Trade Authorities in Russia are discussing two very different approaches to the regulation of cryptocurren
Cardano Holds Crucial Support At $0.77 – Massive Rally Ahead?
Este artículo también está disponible en español. Cardano (ADA) has faced a challenging period, experiencing a sharp 42% correction since reaching a multi-year high of $1
Solana Holds Crucial Level – Can SOL Push Above $200?
Este artículo también está disponible en español. Solana (SOL) is showing resilience as it holds firmly above critical demand levels, signaling the potential for an upcom
Jesse Coghlan54 minutes agoBinance pushes new stablecoin as it confirms plan to cease BUSD supportPaxos has earlier said it will halt support of Binance"s stablecoin by February 2024, now the exchange has said it will al
640,000 Chainlink (LINK) Withdrawn From Exchanges In 24 Hours – Bullish Accumulation?
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu
Crypto Analyst Unveils List Of Top Memecoins To Buy Now
Este artículo también está disponible en español. In his latest YouTube video titled “Turn $1,000 into $100,000 With Meme Coins in 45 Days! [I’m Buying These
How to Anonymously Buy Bitcoin Online and in Person
How to Anonymously Buy Bitcoin Online and in Person Buying bitcoin is a bit like buying contraception: it’s a basic human right, you should be entitled to do so privately,
Digital Currency Group files motion to dismiss $3B NYAG lawsuit
Ezra Reguerra54 minutes agoDigital Currency Group files motion to dismiss $3B NYAG lawsuitDigital Currency Group countered the NYAG’s allegations, saying that after Three Arrows Capital collapsed, it invested hundreds
Best Meme Coins to Buy as Fartcoin’s 300% Run Early Sign for Returning Risk-on Sentiment in Crypto
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu
Elon Musk Criticizes Remote Work as Workers Are Increasingly Worried About Surveillance in Metaverse Environments
Elon Musk Criticizes Remote Work as Workers Are Increasingly Worried About Surveillance in Metaverse Environments Elon Musk, CEO of Tesla and Spacex, said that remote work was no l