Prominent American economist Peter Schiff issued a harsh warning to the US economy on Tuesday, stating that the Federal Reserve's interest rate cuts cannot prevent an economic recession.
Schiff is a well-known gold bull and critic of Bitcoin/USD. He wrote on social media platform X, 'The Fed's interest rate cuts will not stop an economic recession. In fact, the US economy may have already been in a recession for some time, although it has not been officially confirmed.' He further explained that while short-term interest rates may decrease, long-term rates, inflation, and unemployment rates are expected to rise.
Schiff's remarks indicate that the US economic situation is more dire than it appears. He concluded his post by stating 'Game over,' implying a bleak outlook for the US economy. This warning comes at a time when there is ongoing debate about the effectiveness of the Federal Reserve's monetary policy.
Schiff's warning aligns with concerns raised by other financial experts recently. Garry Evans, Chief Strategist of Global Asset Allocation at BCA Research, also anticipates an upcoming economic recession despite potential rate cuts by the Federal Reserve. The strategist emphasized that contrary to market optimism, 'We all now believe' an economic recession is imminent.
In early June, Mohamed El-Erian, Chief Economic Adviser at Allianz, urged the Federal Reserve to cut interest rates promptly to prevent economic instability. El-Erian stressed that the timing and magnitude of the rate cuts are crucial.