US economy poised for a double-dip recession – Ex-Morgan Stanley’s Roach

In an interview with CNBC, late Wednesday, former Morgan Stanley Asia Chairman and Economist Stephen Roach warned of a likely second recession for the US economy while the Wall Street frenzy lead investors astray.

Key quotes

“The odds of a relapse, not just the virus but in the economy itself — the so-called dreaded double-dip, is very real.”

“Recessions are historically double-dip. Roach anticipates this contraction will follow the same pattern despite its unusual origin.”

“This behavioral capitulation on the demand side of the U.S. economy is going to continue to create a lot of problems for businesses, business hirings, [and] potential corporate bankruptcies in the second half of this year.”

“Both economies were able to bring production back quickly, but they’re struggling to bring consumer demand back especially for face to face services where individuals are fearful of getting re-infected.”

“A new US virus aid package is essential in this climate.”

“Our savings and current account dynamic is starting to look terrible.”