The United States may not be in an official recession yet, according to the federal government, but the nation is "in a recession now," and tens of millions of American families already believe the worst is already happening because prices are going up higher than their incomes, and their savings are being rapidly depleted, Steve Forbes, editor-in-chief of Forbes Media, told Newsmax.
"We're in a big mess, and we're going to be already over the cliff on the economy," Forbes said on Newsmax's "Rob Schmitt Tonight" Friday. "Unfortunately, the Federal Reserve believes that the only way to control inflation is by crushing demand; i.e., creating more unemployment, making people poor.
"Let's be blunt about it. When they talk about a soft landing or trying to slow the economy down, that means making people poor. There is a better way that has done it in the past, and that is to stabilize the value of the dollar. But instead, they're going to punish the American economy."
He also dismissed Federal Reserve Chair Jerome Powell's work to achieve the "softest landing" on the economy.
"We are in a recession now, and you have companies more and more announcing layoffs and things like that. Consumer debt is going up, and credit card debt is going up," Forbes said. "Mortgage payments are going to be very bad when those adjustable mortgage rates are readjusted later this year.
"A big, bad thing is happening. And when heating oil prices come in this winter, when you're paying twice as much as you were before and you have to heat your home, that's going to be a disaster. So whatever they want to call it, it's not good."
Meanwhile, the government is releasing lower inflation numbers based on the "so-called consumer price index," said Forbes, so one must take the numbers with a "grain of salt."
"What people feel is, How much are they paying for food? How much are they paying for fuel? What are they paying on their mortgage rates? What are they paying for college and the basic things that they have to do on a day-to-day basis?" Forbes asked. "On that level, Steve Moore, another economist, said, 'You know the official rate is maybe 8.5%.' [But] people feel it's more like 20%, so the cost of living is going up rapidly, and what's bad about inflation? Among other things, it's a hidden tax and the government, but from the reckless overspending. This is the tax we're paying."
This also means that even when people get pay raises, they're still behind, according to Forbes.
"If you have 15% inflation and your pay goes up 15%, you're going to still at the end of the day be behind the curve," he said.
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