Economist and gold bull Peter Schiff doubled down on his negative outlook for the economy and inflation trajectory in a fresh post on X, formerly Twitter, late Thursday.
What Happened: The 4.9% third-quarter U.S. GDP growth may not be a healthy one, Schiff suggested in the wake of data released by the Bureau of Economic Statistics on Thursday.
The GDP, according to the economist, reflected “debt and under-reported #inflation, not actual economic growth.”
“Government and consumers spent a lot of borrowed money, so the nation is actually poorer as a result of this phony growth,” he said.
The gold bull also warned of deteriorating standards of living standards. “Lower living standards will be the consequences for most Americans,” he said.
4.9% Q3 #GDP reflects debt and under-reported #inflation, not actual economic growth. Government and consumers spent a lot of borrowed money, so the nation is actually poorer as a result of this phony growth. Lower living standards will be the consequences for most Americans.
— Peter Schiff (@PeterSchiff) December 21, 2023
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Why It’s Important: The U.S. economy has held up fairly well despite the economic uncertainties. After the economy slowed from a 5.5% rate in 2021 to 2.1% in 2022, GDP growth flatlined at 2.2% and 2.1% rates, respectively in the first and second quarters of 2023.
The third quarter saw growth more than doubling to 4.9%, with all the components of the GDP showing accelerated growth.
Commenting on the robust growth, Comerica’s Chief Economist Bill Adams said, “The U.S. economy managed to absorb a variety of challenges thus far in 2023 and we attribute this surprising economic resilience to employment and the money supply (M2), which is ~30.0% higher than it was prior to the outbreak of Covid-19.”
He expects growth to slow down to 0.7% in the fourth quarter and 0.5% in the first quarter of 2024, with the full-year growth likely coming in at an anemic 1.4%. The lagging impact of the successive rate hikes, another possible government shutdown, and escalating geopolitical tensions pose risks to growth, he said.
Commonwealth Financial Network, however, differed in its outlook for 2024. “We expect a Goldilocks economy—one that offers full employment, economic stability,…
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