Trump's prediction of 'massive recession' puzzles economists

By REUTERS
April 3, 2016 21:54

 
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WASHINGTON - Donald Trump's prediction that the US economy was on the verge of a "very massive recession" hit a wall of skepticism on Sunday from economists who questioned the Republican presidential front-runner's calculations.

In a wide-ranging interview with the Washington Post published on Saturday, the billionaire businessman said a combination of high unemployment and an overvalued stock market had set the stage for another economic slump. He put real unemployment above 20 percent.

"We're not heading for a recession, massive or minor, and the unemployment rate is not 20 percent," said Harm Bandholz, chief US economist at UniCredit Research in New York.

The official unemployment rate has declined to 5 percent from a peak of 10 percent in October 2009, according to government statistics. But a different, broader measure of unemployment that includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment is at 9.8 percent.

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