Goldman Sachs Predicts U.S. GDP to Shrink 5% in Second Quarter

[Julian English]

From Bloomberg: Goldman Sachs Predicts U.S. GDP to Shrink 5% in Second Quarter

The U.S. economy will contract sharply in late March and April as consumers and businesses slash spending, with the short downturn likely be officially deemed as being a recession, according to Goldman Sachs Group Inc.

The world’s largest economy will shrink 5% in the second quarter after zero gross domestic product growth in the first three months of the year, the firm’s economists wrote in a note Sunday. They cut their full-year forecast to 0.4% growth from 1.2% on expectations for growth of 3% and 4% in the third and fourth quarters and strong gains in early 2021.

“The uncertainty around all of these numbers is much greater than normal,” the Goldman economists wrote. Consumers and businesses will continue to cut travel, entertainment, and restaurant spending, while supply chain disruptions and tightening in financial conditions will further dent growth, they said.

Goldman’s projections followed U.S. Treasury Secretary Steven Mnuchin saying earlier Sunday that the coronavirus pandemic probably won’t tip the U.S. into recession, and came before the Federal Reserve cut rates to near zero.

The tRump Depression.

[exboyfil]

1. Even before this no way they were getting 3% to 4%

growth in the 3rd or 4th quarter. Someone needs to push back on this.

[ooky]

2. This is all having a very "Baghdad Bob" kind of feel to it. nt

[SCantiGOP]

6. Especially since their old bro

Mnuchin said he didn’t think a recession was coming.
I know it has to be two consecutive negative quarters, but -5% is a pretty good head start.

Yet 40 something % of the country is glad that the guy in charge is so smart he doesn’t need any real economists or experts to advise him.

[doc03]

3. The toilet paper industry should make a killing for a while nt

[hedda_foil]

7. Unfortunately, Koch Industries pretty much owns the tp business.😟

[doc03]

8. Well they should know their sh--

[Laffy Kat]

9. That's why I only buy Scott T.P. nt

[herding cats]

11. Actually, this doesn't really impact them.

They're making bank upfront, but there's only so much real demand out there. When the dust settles they're in for potentially two quarters (or more) of loss. It's an extremely predictable. It's only adjusted for population growth.

It's not like hand sanitizer and disinfectants, which people actually are using more of right now. We're still all only using the exact same amount of TP.

[BeyondGeography]

4. Ouch

People and businesses will be ruined by cratering and/or lack of income. The numbers will be much worse in the second half of the year if all we get in the way of relief is QE and the stimulus bill that is sitting in the Senate. IE commercial rent relief, consumer debt moratoriums and subsidies for all workers who are impacted by the virus, not just those forced to go on sick leave.

[doc03]

5. I remember hearing before that the mood of the country in April or May will

set the tone for who is elected president in November. If that is the case Trump will get crushed in November. His die hard supporters will still back him but the sensible Republicans and independents are starting to turn IMO.

[livetohike]

10. Remember when Trump said the GDP would grow to

“4,5, or even 6%” ? He is out of tools. Hope our nominee starts blasting him.

[uponit7771]

12. But these idiots want to fund banks