Former Reagan official David Stockman predicted that whoever was elected president in 2016 would “inherit a recession.”
Stockman, former Director of the Office of Management and Budget for President Ronald Reagan, said on May 25, 2016, that Wall Street would undergo “massive panic and selling.”
He appeared on Fox Business’s Cavuto: Coast to Coast where he tore into the Federal Reserve’s policy of keeping interest rates low, as well as America’s accumulation of debt. “We have been living beyond our means for 30 years,” Stockman argued. U.S. debt is at $19.2 trillion and climbing.
“I think whoever is elected will inherit a recession,” Stockman told host Neil Cavuto.
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The former Reagan official also slammed President Obama’s “so-called” economic recovery, which he described as “tepid.”
After Cavuto said he didn’t think the U.S. could go into bankruptcy, Stockman agreed but said Fed policy would make that happen.
“I don’t think we have that option, but essentially that’s what Fed policy today leads to,” Stockman said.
“My point is one way or another, uh, with outright default, someday down the road if we keep going this way, or inflationary default, we can’t live with this debt.”
Stockman also said there were global signs of a recession, citing economic conditions in Japan and China.
“We’ve got a deflationary recession emerging everywhere in the world. Japan, you know, is an old age colony sinking into the sea. China is a massive, speculative mania that’s going to collapse any day.”
