The next stimulus policy expected from Washington in the coming weeks is “absolutely critical to the condition of the American economy,” says RSM chief economist Joe Brusuelas.
“The real economy is in recession. Financial markets were V-shaped [recovery]Brusuelas told Yahoo Finance’s “On The Move”.
“Of course, housing will be the leader because the Fed has zero rates. But if you are not in those isolated sectors, or if you really participate in the financial and technological economy, you are suffering, “she added.
On Monday, stocks opened higher in hopes of a stimulus to help people cope with the economic consequences of the pandemic and Moderna’s (MRNA) announcement of the start of a phase 3 trial for its vaccine candidate. COVID-19.
Nurse Kathe Olmstead prepares an injection as the world’s largest study of a possible COVID-19 vaccine, developed by the National Institutes of Health and Modern Inc., is launched on Monday, July 27, 2020 in Binghamton, New York. (AP Photo / Hans Pennink)
‘Mid-decade’
Brusuelas emphasized the importance of a medical advance saying: “without vaccine, without recovery.”
“In the absence of a vaccine, we will only see an open and reopen sawtooth pattern, better growth, slower growth, perhaps a small contraction,” he added.
The economist doesn’t see the United States lagging behind other countries in the long term, thanks to innovation, technology, and services, but he does see a “really big output gap over a fairly long period of time.”
“I don’t expect us to return to pre-pandemic levels, say January 2020, really until the mid-decade.”
“We are going to have to collaborate and cooperate with our trading partners to start thinking about global production and distribution of those vaccines once they are available,” he said. “In the absence of that, we don’t go back to the January 2020 economy that we were all pretty happy with.”
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