In March this year, in order to boost the country's economy, the United States launched a stimulus plan worth US$2.2 trillion, and most of these funds were obtained through "money printing" by the Federal Reserve. Through loose monetary and fiscal policies, the United States is preparing to pass on the country's crisis to other countries, but there are currently various signs that this plan of the United States may fail.
The recent US Atlanta Federal Reserve GDPNow model shows that the US$2.2 trillion stimulus plan may have been "in vain". Why does say this? The model predicts that U.S. GDP is expected to shrink by 51.2% in the second quarter of this year, making it one of the more pessimistic forecasts for the U.S. economy.
Surprisingly, U.S. government spending is expected to contribute -1.12% to GDP on this model. Why does the US$2.2 trillion in the United States fail to exert a positive stimulus effect, but may instead drag down the country's economy? analysts believe that although the actual expenditure of the US federal government increased by 1.7%, the expenditure of state and local governments fell by 13.3%, which means that the total expenditure of the US government did not increase, but decreased by 7.8%.
In addition, the large-scale "money printing" plan in the United States has also caused the per capita income of American residents to surge. Data shows that because the Federal Reserve has released a lot of money, American workers can "earn" more money without working. However, while income increased by more than 10%, perhaps due to concerns about economic decline, Americans no longer "buy, buy, buy", and personal consumption expenditures fell by 13.6%. This is also a sign that the U.S. economy is expected to be "cut in half." important reasons.
Different from the reckless "money printing" policy of the United States, the People's Bank of China has officially pressed the "pause button" this week after a net investment of 670 billion yuan into the market through the reverse repurchase operation last week. The latest news on Monday (June 1) morning showed that the People's Bank of China announced that since the current total liquidity of China's banking system is at a reasonable and sufficient level, it will no longer conduct reverse repurchase operations today.
