The words of Donald Trump that the US economy is on the verge of a "massive recession" were met with skepticism on Sunday by economists who questioned the calculations of Republican presidential candidate.
Reuters
In an interview with the Washington Post published on Sunday, the billionaire said a combination of high unemployment and an overvalued stock market had paved the way for another setback in the economy. He said that the actual unemployment exceeded 20 percent.
"We are not heading for a recession, mass or less, and the unemployment rate is 20 percent," said Harm Bandholz, chief economist at UniCredit Research in New York.
The official unemployment rate showed a drop to 5 percent from 10 percent in October 2009, according to government statistics. But a different and broader measure of unemployment that includes people who want to work but no longer looking for employment and those with a part-time because they can not find a full-time is at 9.8 percent.
"I think we're on an economic bubble. A financial bubble, "Trump said in the interview.
While some economists agreed that the stock market may be overvalued, few saw the situation as forecast of a recession and an economic cataclysm originating in the United States appears to be a remote possibility.
"There is a very low probability of a massive recession, less than 10 percent," said Sung Won Sohn, economics professor at California State University Channel Islands in Camarillo. "If that happens, it would be so it is happening abroad, especially in China and Europe," he said.