U.S. Economy-Plunge, Stagnation & Turning Down Anew-John Williams

WILLIAMS_092_wade.JPGBy Greg Hunter’s USAWatchdog.com

Economist John Williams says to forget about the so-called recovery.  What’s coming next is recession or worse.  Williams contends, “The fact that we saw a -2.9% contraction in the first quarter, in official reporting . . . you know the economy is in real bad shape.  It’s continued to the second quarter, and that will gain recognition as all the data gets published.”  Back in 2013, Williams predicted that it would be “game over” in 2014.  What are the statistics showing him now?  Williams says, “They are showing the economy continues to weaken, and it never recovered.  A second quarter contraction here would most assuredly be recognized as a new recession, and I contend we never got out of the old recession.  We had plunge, stagnation and, now, we are turning down anew.” 

On recent news, the Federal Reserve ending the bond buying program in October. Williams says, “I expect the Fed will always be there to buy it.   I looked at their announcement, and the October end is preconditioned on the economy continuing to show positive economic results as the Fed expects.  That’s not going to happen.  The easings (money printing) that we’ve seen by the Fed have been aimed at propping up the banks by providing liquidity for the banking system.  It’s not stimulating the economy.  Former Fed Chairman Bernanke admitted the Fed was at a point where there was very little they could do to stimulate the economy.  The problem is keeping the banking system afloat.  A weaker than expected economy, and we are looking at something that is much weaker than expected, means the banking system is going to be under further stress.  It hasn’t recovered since the crisis of the panic of 2008.  So, the Fed will want to continue to provide liquidity.  The problem is that is not politically popular.  So, they have been using the bad economy to bail out the banking system, and that is going to continue.  I’ll be surprised if the ‘tapering’ actually comes to an end in October.”

So what happens when the second quarter economy comes in weaker than we are all being told?  Williams paints a grim picture and says, “A weaker than expected economy means the budget deficit is going to be worse than expected.  A weaker than expected economy will also tend to trigger selling pressure against the dollar.  I am still looking for a massive decline in the U.S. dollar.  A massive decline and a renewed recession can certainly be a trigger for that.”

Williams goes on to explain, “There are a number of reasons for a dollar crash to happen such as questions about Fed policy, long term solvency questions in the United States, political stability and the popularity rating of the President.  When that’s low, the dollar usually comes under selling pressure.  You put all these factors together and the rest of the world is waiting for the U.S. to get its act together, and it is clear now we are not going to do so. . . . The rest of the world is going to be in position to basically get out of the dollar, and once people start moving, you will have a flood of people start moving.”  Please keep in mind, Williams says, there are more than $16 trillion liquid dollar assets held outside of the United States.  If everybody starts dumping their dollars, Williams says, “That could trigger very high inflation here.  You will see, for example, higher oil prices.  You will also see mounting pressure, that is already there, to have the dollar removed as the world reserve currency, and that would accelerate domestic inflation.  I am still looking for a near term hyperinflation; that is dependent on a very heavy decline in the U.S. dollar.”

How bad could things get on the inflation front?  According to Williams, measured against gold, the dollar could become virtually worthless.  Williams contends, “In a hyperinflation, which I am looking to evolve here, gold could be $100,000 per ounce or a million dollars per ounce.  All that reflects is purchasing power of the dollar assets you put into gold represent the purchasing power if you kept your asset in dollars.  Gold is a store of wealth.  I am not looking at this to make profits.  I am looking at this as a long term hedge against high inflation to maintain purchasing power for the terrible currency crisis ahead.” 

Join Greg Hunter as he goes One-on-One with John Williams, founder of Shadowstats.com.

(There is much more in the video interview.)

After the Interview: 

There is free information for the public on Shadowstats.com.  Williams also offers detailed reports for $175 per year, and $89 for a six month subscription.  If you would like to subscribe to Shadowstats.com click here.

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Comments
  1. Jerry

    Greg nice interview. What else can you say? Stick a fork in it, we’re done. Take a look at this article.
    http://www.thechinamoneyreport.com/2014/07/13/global-payment-system-underway-for-rmb/
    And if you’re looking for a trigger, go no further than this.
    http://rt.com/news/172404-russian-donetsk-shelled-victims/
    The American people may be asleep, but the rest of the world clearly is not. Really how much more evidence do you need in order to see what’s getting ready to happen?

    We have a straw man economy being propped up by a banking cabal. A straw man figure head for its president. And a pile of worthless paper for currency. Does anyone smell smoke? I do.

    • smaulgld

      Jerry
      I understand that not everything should rise to the level of alarmism, but you are absolutely correct, the media and Fed are not fooling anyone with the everything is fine narrative. Here is Voltaire’s Candide in full for free
      http://www.literature.org/authors/voltaire/candide/

      • allen ols

        SMAULGLD, JERRY, UGLY, COLIN, LASTMANSTD; VIEW THIS SHORT 3 MIN VIDEO.

        http://www.prageruniversity.com/Political-Science/Middle-East-Problem.html#.U8Rh0PldWSr

        • smaulgld

          Too simplistic.
          He missed the 56 and 73 wars. He makes a mistake of assuming all the arabs have the same interests. They don’t. The pan Arabic concept is a myth- with rifts between Arabic states and within the muslim religion (Sunni/Shia) .

          It should be obvious that Egypt has separate goals than Palestinians. As do other Arab and Moslem nations.

          Egypt is a long standing nation, Palestine as the narrator pointed out is not. Israel was not in control of Egyptian lands prior to 1967. They gained the Sinai (Egyptian) peninsula from Egypt after Egypt attacked Israel. Egypt got a good deal a took it. They lost and got a chance at a do over.

          From the Palestine point of view, they lost before it started. Israelis were mandated land by the UN , land that Palestinians also lay claim to. True Jews, Christians and Moslems all lived there and could claim the land, but Israel was picked to the detriment of the Palestinians.

          I don’t know much about the whole situation, but it seems when Iran is antagonistic against Israel its not on behalf of their “arab” brethren the Palestinians since Iranians are Persians not arabs.

          • allen ols

            smaulgld @

            I think he simplified b cause of the attention span of the average moron american cant watch a long video, docum. unless there are two large boobs and a big naked butt in it. 🙂 guys like u and i love a 3 hr docum.

        • Wall Street MainStreet_Money&Politics The real poop

          “If only there were evil people somewhere insidiously committing evil deeds, and it were necessary only to separate them from the rest of us and destroy them. But the line dividing good and evil cuts through the heart of every human being. And who is willing to destroy a piece of his own heart?”

          ― Aleksander Solzhenitsyn

    • West Tejas

      The feedback I’ve received is to be “ready” by mid July and expect a rapid decline in the paper price of metals. A couple months after this expect the physical bull market to begin.
      What is the catalyst I have no idea but something big must be happening behind the curtains.

      • Ugly

        It is mid July. Are you saying were downto hours and minutes?

        • Galaxy 500

          You said it brother. I am always skeptical of Pastors/Preists/ stockbrokers / conspiracy theorists who claim arcane, inside or special information from on high or from secret sources. Secrets are impossible to keep and the more sensative / explosive the secrets are OR the more people you add, the probability of a leak is exponential not linear. Add time to it and it becomes even harder if not impossible. You can keep secrets if you kill everyone who knows it but then, how do you have a vast NWO conspiracy with one person in on it?
          Oh, sure…no doubt that a group of wannabe dictators at the UN have a wet dream of taking over the world but that is hardly a secret and they will get girl / boy friends they dont have to pay before that happens (which aint damn likely either)

          • allen ols

            G5,

            Be sure to look at this oh merchant of beans, and peddler of kool-aid, 🙂

            PART ONE
            https://www.youtube.com/watch?v=z8W-t57xnZg

            PART TWO
            https://www.youtube.com/watch?v=qW81Cd7nNH8

            HERE IS AN ENGINEER using thermite to burn I-beams and bolts W/ interviews. must watch!
            https://www.youtube.com/watch?v=5d5iIoCiI8g
            this shows govmt man lying, and firefighters telling about molten steel, and more. lol the case builds.
            https://www.youtube.com/watch?v=8YaFGSPErKU
            CIA INSIDER TELLS TRUTH, MUST WATCH.
            https://www.youtube.com/watch?v=rnbMjAN7Bws

            7 min vid.

            https://www.youtube.com/watch?v=ssuAMNas1us

          • Galaxy 500

            Al , Dude, there are utube vids where people claim to be Jesus. Do you believe those? You never told me what kind of cow you were trading for my magic beans. It has to be an Angus or I’ll just keep them. I hear that if you plant them during a full moon, in a few days, the moon wont be full any more…its magic

          • Edmond Dantès

            All conspiracies are not just theories, however it is not just about a conspiracy, it is also about the national delusion of wishful thinking, what is happening with financial manipulation is a conspiracy but not a secret, it is out in the open but governments an central bankers do not care because they are a part of the manipulation, and people do not care because of normality/optimism bias, believing in the current economy because they want to. You can also keep secrets if people do not want to know the truth.
            You are being disingenuous by deriding JW as a “Conspiracy Theorist”. What Williams does is to take today’s data and apply the statistical methods that the FedGov used to use, but switched away from in order to provide more optimistic results.

          • NY Cop on the beat

            allen ols ????

            I am shocked that you are allowed to post this conspiracy garbage here. 9/11 occured purely because radical Islam hates our freedoms. They desire to turn pour Utopian society of freedom and democracy into a nightmare wasteland. You are serving the means and the objectives of the terrorists. Woe be unto you sir !

          • allen ols

            g5 dude;
            SO, u believe, the fed is criminal, the central banking is a ponzie, u believe obama is a lying, the nsa does spie on citizens, u believe in the eurasian trade zone, china gold backed yuan, u believe israel is right to retaliate, and a mine field should be on our southern border, u believe and know what the reserve currency means to the world, but 98% of us citizens have no clue, and u agree to that, BUT, u just cant agree 911 was a set up, BUT was done by a few arab terrorists, and OBL; but in fact embrace that cheney, bush, rumsfield, and clan knew nothing of what was going on. And the NSA which spies on everyone, and is corrupt, (snowden) was BLIND to all this. In fact your in the 98% of usa sheeple that believe terrorists did the
            deed.
            And u feel u drink the nice edschu german coffee, the octoberfest german beer, and fine cognac, when in fact u may want to check, u may have stumbled onto a koolaid jug, mistaking it for a stien of ger. beer.

            I have been to october fest , drank educho coffee in the coffee bars w/chocholate and ate the fine dark ger. bread. I was at the bob dylan concert in ’78 in Nuremburg.

            check your drink, it is full of kool aid.

          • Don_in_Odessa

            Or, you can release a “secret” to the right nutballs and have it spread across the entire Alt-Media world lickety-split.

        • allen ols

          @NYcop on beat;

          research ole buddy;

          PART ONE
          https://www.youtube.com/watch?v=z8W-t57xnZg

          PART TWO
          https://www.youtube.com/watch?v=qW81Cd7nNH8

          HERE IS AN ENGINEER using thermite to burn I-beams and bolts W/ interviews. must watch!
          https://www.youtube.com/watch?v=5d5iIoCiI8g
          this shows govmt man lying, and firefighters telling about molten steel, and more. lol the case builds.
          https://www.youtube.com/watch?v=8YaFGSPErKU
          CIA INSIDER TELLS TRUTH, MUST WATCH.
          https://www.youtube.com/watch?v=rnbMjAN7Bws

          7 min vid.

          https://www.youtube.com/watch?v=ssuAMNas1us

          • allen ols

            @nycoponbeat;

            1. JP4, or 5, or avgas, jet fuel, CANNOT BURN HOT ENOUGH , OR LOOOOONNNNNGGGG ENOUGH, TO MELT THICK I-BEAM STEEL. Notice the liquid melted steel running out of the top floors. Did u notice the bldg 7 just happened to fall straight down in its own footprint? I KNOW, the other 2 falling towers SCARED THE HELL out of bldg 7. 🙂

            2. The SECONDARY FIRES, OR OFFICE FURNITURE, CANNOT GENERATE ENOUGH HEAT, -IE- TEMPERATURE TO MELT THE STEEL, yet alone the reinforcement steel in the concrete itself.

            3. and the first hand testemonies of explosions in the lower floors heard by police, firefighters, and civilians.

          • allen ols

            ny cop; g5

            No plane hit building 7, yet there is molten metal under bldg 7, so whats up my friend, watch below.

            http://sgtreport.com/2014/07/thermite-proof-on-9-11-sola-8-18/

            • Greg Hunter

              Allen,
              Nobody can explain how a huge building like “7” could fall straight down in free fall without it being hit. They say vibration–give me a break!
              Greg

      • Galaxy 500

        How can silver get any cheaper? Supplies are tight and the current selling (spot) is about $5 less than cost to produce. I’ve had people post that just dont understand hedges and futures. In light of American Barrick borrowing billions to close out all theirs, I think I do understand. Contrary to popular belief, you cant stay in business selling future contracts below production cost and survive in a zeroiinterest rate world. Its not a rational business model.

        • West Tejas

          @Galaxy500 : I have no idea how the silver producers are surviving since most are producing well below costs.
          Did you read this article on why gold / silver got monkey hammered this morning? http://www.zerohedge.com/news/2014-07-14/gold-silver-plunge-most-2-months

          Even with the $1.37 billion dump this morning we can only bet that not 1 oz of real physical metal changed hands. It was nothing but paper contracts.
          So do you really believe they can’t make it go lower?

          • allen ols

            Yes G5, can u figure out how, bldg 7 collapsed w/o damage from wttowers, but was supposed to fall by fire melting I-beams, wrapped in concrete steel. Hmmmnnnn seller of beans.

          • allen ols

            g5/beans

            https://www.youtube.com/watch?v=CUmGvyUIU_E

          • allen ols

            g5
            geo bush vid.

            https://www.youtube.com/watch?v=KlWSv0NZBRw

          • Galaxy 500

            Yes, I know they are beating the snot out of gold and silver with naked shorts. Dow closed at 17055, silver down 48¢ @20.98. Gold down 28 @ 1308. With the turmoil it seems counterintuitive doesn’t it.

        • Don_in_Odessa

          That’s why we have options, futures and ETFs. The market, actually all markets, can be and are easily be manipulated using these make believe instruments. Nary a change of possession ever has to take place. These days they even write paper on the make believe instruments and trade those as something real. What’s worse? They write paper on the paper on the make believe …. Well, you get the idea. Someday, someone will ask for the physical metal or the case of publicly traded stock the actual stock certificate and the whole financial world say … HUH? OOPS! Uh, would you believe my hard drive crashed!

        • Kerry

          thus the reason it will all fail, eventually
          you cant keep borrowing without paying a price for it sometime in the future, that occurs in natural systems, too

    • Saint Lawrence

      No smoke. I was eating dinner in Northern Illinois at an oligarchs’ house one night, it was a corporate asset. His car was titled and insured in a corporate identity….
      There are no free markets left. Even the poorest of the oligarchs form corporations, and trusts through their lawyers and stooges. Trillions have been moved offshore and repatriated through banks, controlled by the oligarchs. They own the businesses, they have citizenship in places like caymen islands, Israel, etc. The business owns the car they drive, the home they live in … these are who the jet-setters emulate.
      Illegal aliens provide almost free labor- to build skyscrapers, pick fruits and veg., process meat and poultry, clean the hotels-motels with no benefits – contract labor with a “provider”. When you see the shadow flows of billing and labor, you know free market is fiction.
      “The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson.” – FDR letter to Colonel Edward House, Nov. 21 1933
      http://www.corbettreport.com/federalreserve