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American real estate billionaire: US economy on the verge of collapse
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The head of COLONY CAPITAL, real estate billionaire “TOM BARRAC”, warned that the US commercial mortgage sector is on the verge of collapse.
He pointed out that this will generate a series of disastrous consequences for the American economy, unless the government and the banks move with the required procedures quickly.
Barak added that the failure to act to face the corona's consequences could end in massive evictions of real estate and a series of consecutive sales orders, which could lead to banks faltering.
Economists at Morgan Stanley and Goldman Sachs Group have said that the outbreak of the Corona virus will cause greater economic pain than they previously expected, warning of a record drop in US output in the second quarter and a deeper global recession, according to "Bloomberg".
American economists working at Morgan Stanley told the bank's clients in a report that they now see a 30.1% drop in US gross domestic product from April to June. They said this would increase unemployment to an average of 12.8% during this period.
Goldman Sachs experts said they now expect the global economy to contract by 1% this year, which will be a bigger downturn than in 2009 amid the financial crisis. They actually expected a 24% drop in US production in the following quarter.
The disturbing forecasts from two of Wall Street's two largest banks reflect the abrupt halt in US and European economies in the wake of the Chinese recession at the beginning of the year.
Such forecasts raise fears of an economic recession, but economists at Morgan Stanley said in a separate report that continued deflation should be avoided given the response of fiscal and monetary policy makers.
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