Cetoex News – The ongoing banking collapse is the tip of an economic mega-crisis, according to Democratic presidential candidate Robert F. Kennedy Jr. RFK Jr touches on the subject of the ongoing economic struggles involving banks in a recent tweet Tuesday. He addresses both inflation and jobs in the tweet.

“Job openings plummeted for the third month in a row,” the Democratic candidate says. The number of job openings decreased to 9.6 million on the last business day of March, according to a U.S. Bureau of Labor Statistics report. Additionally, layoffs and discharges (1.8 million) increased at the same time in March.

RFK Jr. also addresses how inflation is weakening multiple classes. “Inflation is destroying the middle and working class. We need to turn our attention to rebuilding our nation — NOW.”

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Cetoex News – Amidst the international conflict regarding the greenback, the prevalence of American currency has taken a hit. Subsequently, the US dollar has lost an astronomical 98% of its purchasing power since 1971.

Purchasing power refers to the strength of one specific currency in reference to the total amount of goods and services that could be acquired through a single unit. Thus, the power of the US Dollar has seemingly plummeted in five decades.

US Dollar At its Weakest

The US dollar has been a constant headline in the past few weeks. Specifically, international trade is seemingly focused on doing away with the currency’s current uniformity. In turn, some troubling statistics regarding its strength have surfaced.

The US Dollar has concerningly lost 98% of its purchasing power since 1971, according to data from Visual Capitalist. Thus, proving that the unit of American currency has gotten exponentially weaker over time.

In 1933, that same report notes that a single US dollar could purchase ten bottles of beer. Conversely, that same unit today could only be good for acquiring a small cup of coffee from Mcdonald’s. Subsequently, the value of a single US dollar has decreased over time, as price levels have only risen.

The Federal Reserve Act granted Federal Reserve Bank the ability to manage the money supply in 1913. Yet, with the increase of US dollars in circulation, the power of the currency began to decrease. Thereafter, the value of the Consumer Price Index (CPI) had already grown 73% by 1929, with the purchasing power already diminished.

Alternatively, the money supply in the United States has increased rapidly over the last 20 years. Specifically, the number has increased from $4.6 trillion in 2000 to $19.5 trillion in 2021. Conversely, the COVID-19 pandemic clearly affected that supply, with $3.4 trillion created in 2020 alone.

International Trade

The development is all the more concerning considering the trajectory of international trade. Moreover, Saudia Arabia’s finance Minister, Mohammed Al Jadaam, told reporters of the nation’s willingness to trade with alternative currencies.

“There are no issues with discussing how we settle our trade arrangements, whether it’s in the US dollar, the euro, or the Saudi Ryal,” Al-Hadaan said according to MoneyWise. Subsequently, his statement coincides with recent action taken by BRICS nations hoping to dethrone the US Dollars’ dominance.

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Cetoex News – Despite the consistent pressure facing the finance sector, US Treasury Secretary Janet Yellen has stated her belief that the US economy is performing “exceptionally well.” Moreover, Yellen was adamant about the resiliency of the banking sector amid recent turmoil.

Conversely, Yellen’s statements arrive contrary to the perspective of various US banks. Specifically, Bank of America and JP Morgan have expressed concern over the current economic state of the country and what that means for the banking sector.

Yellen Praises US Economy Performance

There is little argument to be made against growing concerns regarding the United States’ economic outlook. Subsequently, as the banking sector experienced some of its largest closures since 2008, starting with Silicon Valley Bank, continued inflationary pressure has forced the hand of the Federal Reserve.

Yet, these developments have seemingly not phased the nation’s principal economic adviser. Specifically, Treasury Secretary Janet Yellen says the US economy is performing “exceptionally well.” Additionally, Yellen told CNN that she is not expecting an economic downturn.

“I’ve not really seen evidence at this stage suggesting a contracting in credit, although that is a possibility,” Yellen stated at a press conference. She added, “I believe our banking system remains strong and resilient; it has solid capital and liquidity.”

Conclusively, Yellen remarked that the “US economy is obviously performing exceptionally well,” during her statement. Furthermore, noting job creation, inflation statistics, and consumer spending as factors supporting her statements. Additionally, the global economy was “in a better place than many predicted last fall,” Yellen proclaimed. “That basic picture has remained largely unchanged.”

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Cetoex News – One of the most well-known financial institutions in the country has added yet another grim outlook on the nation’s financial state. Specifically, Bank of America warns that the US economy is at risk of shrinking in Q2. Moreover, the development comes after JP Morgan CEO, Jamie Dimon, spoke of similar concerns over the US economic outlook.

Conversely, Bank of America had recently identified various activities that could forecast a recession. Business Insider reported the bank’s statements that, “investors are too optimistic on rate cuts and not pessimistic enough on recession,” within a recent report.

Bank of America’s Worrying Forecast

The last few months for the American economy have certainly left a concerning outlook for the financial sector. Specifically, inflation continues forcing the hand of the Federal Reserve, as worries surrounding the international prominence of the US dollar fade quickly.

Now, one of the largest financial institutions in the country has added its rather unsettling perspective. Specifically, Bank of America warns that the US economy is at risk of shinking in Q2. Moreover, they have warned of a potential recession, similar to a warning from JP Morgan CEO, Jamie Dimon.

Alternatively, these statements arrive alongside their forecasting of a full-blown recession for the economy. Specifically, Reuters reported a client note from the Bank of America Global Research that shared the risk.

“This week’s data flow is consistent with our view that the U.S. economy slowed steadily over the course of 1Q 2023,” Bank of America said in the note. Additionally, it read, “As a result the hand-off to 2Q looks weak, we see meaningful risks of a contraction in GDP in 2Q.”

Moreover, the Bank of America also referenced data from April 3, showing a slow in US manufacturing activity. Furthermore, the data observed March had the lowest levels in nearly three years, coinciding with a plummet.

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