Economist Says Chance of 2020 Recession Only 50%
NEW YORK – Nobel Prize-winning economist Robert Shiller, who predicted the 2000 market collapse and the housing crisis that led to the Great Recession, says he believes there’s a less than 50% chance of a recession next year.
“Whether it’s coming next year, I can’t be sure,” he told the Financial News in an interview published Monday.
The Trump administration’s escalating trade war with China and slowing growth overseas have battered U.S. manufacturing and convinced many economists that a U.S. recession is likely next year. Economists surveyed by the National Association for Business Economics say there’s a 60% chance that the record 10-year-old economic expansion will peter out and a downturn will begin by the end of 2020.
Although the economy has been growing solidly, the Federal Reserve lowered interest rates in July for the first time in a decade to head off a potential slump. Fed policymakers are expected to cut rates again next week.
Shiller, 73, says he “wouldn’t be at all surprised” if a recession begins next year, but he doesn’t have the sense of foreboding he had during the dotcom bubble in 2000.
Shiller predicted the market dot-com meltdown in his book, “Irrational Exuberance.” His book, “Narrative Economics,” will be published next month.
Copyright 2019, USATODAY.com, USA TODAY, Paul Davidson
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