Could the economy go into a 'double-dip' recovery?


Almost every state is into some form of re-opening right now, which is leading to a 'Nervous Nellie' narrative from the mainstream media.

And that narrative is a "W" shaped economic recovery. Fed Chair Jerome Powell told CBS it's what could happen if the we see a big spike in new cases.

"The government would have to re-introduce the social distancing measures. You would have another downturn. That would be bad for confidence," Powell said.

Texas Public Policy Foundation Chief Economist Vance Ginn says we've seen that kind of recovery before.

"In the early 1980's there was this kind of recovery; when people were talking about rising interest rates," Ginn stated.

So will it happen again?

"It depends on how long these shutdowns last. The faster that we end them, the more likely it is we see something more like a 'V' shaped recovery," Ginn explained.

But if we get tougher lockdowns because of a second wave of the virus, it could change the shape of the recovery.


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