- Larry Summers warned that the United States could face a crisis similar to that of the United Kingdom at the end of 2022.
- The former secretary of the Treasury referred to the plans proposed by the Prime Minister of the UK of the time, Liz Truss.
- Truss resigned after swallowing tax reduction proposals that frightened investors and sent arrow bond prices.
Larry Summers is concerned about the economy and fears that the United States can be on a track similar to the problems with which the United Kingdom was faced at the end of 2022.
“I would have said that a” moment Liz Truss “was very unlikely in the United States if you had asked me three months ago,” the former Treasury Secretary at BBC Radio 4 on Tuesday.
“Now, I think we are on the way to having an episode like that. I think it will be very expensive for our economy – and for the world economy.”
Truss resigned from his post as British Prime Minister in 2022 after only 44 days in office – the shortest mandate ever recorded.
After having become Prime Minister, she and her Minister of Finance proposed radical tax reductions to be funded by additional government loans. These policies have frightened the financial markets, sent the cost of the arrow -shaped obligations and sparked a revolt within its own party.
Summers also said that market disorders in the United States were starting to look like what you can expect from an emerging market economy.
“It is difficult to know what the end will be,” he said. “We have seen a phenomenon in the United States, it is almost unprecedented in our financial history. We see the type of response that occurs in emerging markets when the world loses confidence.”
“Actions decrease, the obligations decrease, the currency breaks down, gold begins to be accumulated, it is the model we see in the United States.”
The actions dropped Monday after President Donald Trump again criticized the president of the Federal Reserve Jerome Powell for not having reduced interest rates, calling him “major loser” and “Mr. Too late”.
The future has since slightly climbed, but the yields of the treasury at 10 years have increased and the US dollar index has weakened. Gold prices have reached a new record of $ 3,500 on Tuesday, having climbed more than 30% since the start of the year.
Earlier this month, Summers said on the announcement of Trump’s X prices: “Never before an hour of presidential rhetoric costs so many people.
Get the last price of gold here.
businessinsider
