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The Washington Post criticized the US for lying about the “negative growth” of the economy

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US GDP is shrinking for the second quarter in a row, and the US authorities continue to insist on “negative growth” of the economy. This statement was made by The Washington Post columnist Charles Lane.

“US Department of Commerce data released on Thursday could well confirm that gross domestic product has contracted for the second quarter in a row,” he wrote on July 27.

Against this backdrop, the White House released a statement on July 25 noting that there was nothing “official” about the oft-cited rule of thumb that a two-quarters losing streak defines a recession.

According to Charles Lane, this situation was reminiscent of how the notions of “recession” and “depression” were avoided by the administration of the 39th US President Carter. His aides, concerned about possible political repercussions, instructed him never to use the words “depression” or “recession.”

As a result, Alfred Kahn, the Cornell University economist responsible for President Jimmy Carter’s efforts to fight inflation, quipped at his next meeting with reporters that the nation was in “danger of the prospect of the worst banana in 45 years.”

Today, the inhabitants of the United States are once again threatened by inflation. But, as noted in the material, there are not many effective tools at the disposal of US President Joe Biden.

“As Kahn predicted, it took a sharp—how ​​shall I put it—to quell inflation? — a recession triggered by higher interest rates by the Federal Reserve and marked by unemployment, which peaked in 1982 at 10.8 percent. A similar Fed rate hike that began in March has caused many to worry about the banana risk now,” Lane said.

According to him, the US economy has already slipped on the skin, and public policy has not yet brought results. He recalled the situation in the milk formula market, which is still experiencing a shortage: it was Washington’s actions that made the supply chain vulnerable after the shutdown of the largest plant in the US, Abbott Laboratories, the author believes.

According to a new press release from the Bureau of Economic Analysis of the US Mintorg, the country’s GDP in the second quarter of the year fell by 0.9 percent in annual terms.

On July 24, Treasury Secretary Janet Yellen said that a slowdown in the US economy is a necessity. She added that inflation is “too high” in the country, the economy is slowing down, but noted that there are no signs of a recession.

On July 13, Bloomberg reported that annual inflation in the US accelerated to 9.1% in June. This figure was the highest since November 1981.

On July 11, the German edition of Wirtschafts Woche noted that the US economy will not avoid a recession, the only question is when this will happen. One of the prerequisites for an economic downturn can be considered a systematic decline in rates on US stock exchanges and a similar situation with interest rates on long-term bonds.

Bloomberg said in June that this rise in U.S. inflation would push the Federal Reserve to raise interest rates and “exacerbate political problems for the White House and Democrats.” The day before, US President Joe Biden called record inflation in the country a “curse”.

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