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The American economy is booming like it hasn't in a long time

The American economy is booming like it hasn't in a long time

California Supermarket Customers: Consumption is one of the pillars that supports economic growth in the United States.
Photo: EPA

President Joe Biden's economic policies have come under heavy criticism. Now the particularly strong growth of the US economy surprises many economists. They predicted a deep recession.

aOn October 1, 2023, business medium Bloomberg published one of its in-depth analyzes with the conclusion that a recession in the United States was lurking just around the corner. This was largely confident because the mood among experts had already changed in the fall and a soft landing for the economy suddenly seemed possible. Three weeks later, the growth rate for the third quarter was announced: the US economy had grown nearly 5% this year, a figure that astonished some observers.

However, the pessimism of Bloomberg economists was consistent. About a year ago, based on an internal forecasting model, they had already insisted that recession was as certain as an “Amen” in church, 100%. They knew they were in good company. Harvard economist Larry Summers was not only one of the loudest critics of the Biden administration's spending policy, which he blamed for America's high inflation rates. He also predicted that inflation would not be brought under control without a significant increase in unemployment. “We need five years of unemployment above 5 percent to keep inflation under control, or in other words, we need two years of 7.5 percent unemployment or one year of 10 percent unemployment.”