Billionaire investor Leon Cooperman raised a stark warning that the US economy is headed for a financial crisis. He pointed out that the nation’s skyrocketing debt of $34.3 trillion is the main catalyst that will bring the US economy down. The debt is growing uncontrolled and getting out of hand to tame by lawmakers and the Federal Reserve.
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The spotlight remains on the economy as the US presidential elections are scheduled in November this year. Both the candidates Biden and Trump have different views on the economy that will change the direction of the nation’s finances.
US Economy Moving Towards a Financial Crisis, Explains Billionaire
Cooperman explained that Biden’s economic policies were weak and gave way to the spiraling debt in three years. He also questioned his leadership abilities to change the course of the economy in a short period. “I think we have a system of leadership in this country that’s evolved to a leadership crisis,” he said to CNBC.
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The billionaire warned that if the debt is not brought under control, the US economy will experience a financial crisis. “Deficits matter, and I think we’re headed into a financial crisis in this country. We have a deficit that is very large,” he said.
He also hit out at the Federal Reserve for being too restrictive on cutting interest rates. “Now they’re talking about cutting rates and the Fed is too restrictive. There’s no sign that I could tell from the economy and the market that the Fed is restrictive,” he said.
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Apart from the growing debt, the crisis in the Middle East is also a cause of concern for the US economy. The escalating turmoil between Iran, Israel, and Palestine threatens the global equity and commodity market. A crash in any of the financial sectors will cause ripple effects on the US economy and finances.