Billionaire Peter Thiel has expressed concern that the US economy would likely be in a recession if not for extensive government intervention.
During a discussion with Chamath Palihapitiya at the All-In Summit 2024, Thiel suggested that while a downturn is imminent, it has been temporarily avoided due to significant government spending.
Thiel criticized the current level of government stimulus as unsustainable, pointing to enormous budget deficits. He noted that the projected deficit for fiscal year 2024 had significantly increased from an initial estimate of $1.5 to $1.6 trillion, now expected to be around $400 billion higher.
Thiel remarked that such high deficits at the peak of the economic cycle, rather than during a recession, indicate a troubling economic situation.
Recent figures from the Congressional Budget Office reveal a $1.9 trillion budget deficit for the first 11 months of the 2024 fiscal year, a $373 billion increase from the previous year.
Additionally, the Treasury Department reports that the national debt has reached a record $35.273 trillion.
On September 18, the US Federal Reserve made a notable move by cutting interest rates by 50 basis points, marking the start of a new easing cycle.
The Federal Reserve’s recent 50 basis point rate cut left experts divided.
After the long-awaited rate cut by the Federal Reserve, the crypto market started showing signs of recovery.
Federal Reserve meetings usually follow a predictable pattern, but this week’s Federal Open Market Committee (FOMC) gathering was shrouded in uncertainty.