Many economists are warning that the U.S. could dip back into recession if Congress doesn’t roll out more stimulus. However, others think the economy will continue to recover even if no new stimulus measures are introduced. Still, others warn that the very efforts designed to pull the economy out of a recession could spark another financial crisis.
What’s clear from the wide range of projected outcomes is that it’s anyone’s guess what will happen next, with or without more stimulus.
Another financial crisis?
Deutsche Bank economist Peter Hooper said in a recent report that the global recovery from the COVID-19 pandemic has been going much faster than he had expected “in the gloomy days of early May.” His team projected that the global economy had recovered about half of the GDP it lost during the pandemic and that it wouldn’t reach pre-pandemic levels until the middle of next year.
Despite that long projection, that’s still two quarters earlier than the timeframe his team was previously forecasting. However, he also said the price of seeking stability in the short term could be steep over the long term
