The US Federal Reserve has been attempting to stop investor panic with its emergency actions, but those moves are like firing “a water gun” when we need “a bazooka,” Tobin Smith, CEO of Transformity Research, believes.
Speaking to RT’s Boom Bust, the analyst said that the real problem is in the US debt market, as there is four times as much debt than there was in 2008-2009.
“This is as a financial disaster, as a health disaster as an economic disaster – is like we got three neutron bombs dropped on us,” Smith warned. “First we obviously have the coronavirus and the pandemic, then we’ve got the oil pandemic… and then the third bomb is the government sitting around doing sort of half measures when we’ve essentially had a virtual economic attack.”
Those factors have equal ripple effects across all the financial system and have already plunged the country into a recession, he noted, adding that the S&P Index can drop to 1,600 points. And now Washington needs to deliver another “neutron bomb that offsets the neutron bomb that had been exploded into our system,” according to Smith.
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