Charles Payne: Economy is like a rubber band, it can snap back or break
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Fox Business host Charles Payne has a dire warning for the state of the U.S. economy, as most American businesses remain shuttered amid the coronavirus pandemic.
«The worst-case scenario gets worse every single day,» he said Thursday on Fox Nation’s «Wise Guys.»
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«We had the Federal Reserve saying as many as almost 50 million people in the second quarter could lose their jobs,» he continued, «53 million total unemployed, 32 percent of the workforce unemployed.»
The number of Americans seeking unemployment benefits swelled to 6.6 million last week, surging for the third consecutive week, according to the weekly jobless claims report from the Labor Department published on Thursday.
That brings the number of applications for the last three weeks to more than 16 million, a stunning sign of the colossal economic damage inflicted by the outbreak.
«The economy and the stock market is considered to be elastic. You can even think of a rubber band,» analogized Payne, «So the more you pull it all the way back and let it go, the more it should snap back. Of course, you can pull it back far enough where it breaks. And that’s what we’re gonna be tested with in the second quarter.»
«But having said that, we can come back in the third quarter and the fourth quarter… It all gets down to how long we are shut down… once we start going past April, it’s going to be hard to model this at any kind of way,» he added.
President Trump expressed similar optimism for an economic recovery, tweeting on Friday, «We have a great chance for the really big bounce when the Invisible Enemy is gone!»
Payne also said that Americans in 2020 would be wise to learn the history of the Great Depression of the 1930s.
«The initial parts of the Great Depression were severely great and depressing, because we had been so prosperous, and we’re in a very similar situation,» he observed.
«By 1934, 1935, 1936, some of those numbers started to level off, the death rates, the suicides. People just accepted that mediocrity. There was a saying that said: use it up, wear it out, make it do or do without. And that’s not the America that we know. We fell into a funk. So we don’t want to become that nation,» he warned.
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«So there’s a two-prong part to this. There’s a part where the economic shock will cost lives. It will cause depression. It will cause really pressure within homes that we’ve never even seen or quantify. But it could also lead to a longer-term, a self-fulfilling place where we just don’t feel like we can get there. We can’t do it anymore.»
«I think the magic of the Trump administration has been to reignite the animal spirits of this country. And we’ve got to keep those going. We must keep those alive,» he concluded.
To watch all of this episode of «Wise Guys,» including former House Speaker Newt Gingrich’s thoughts on President Trump’s handling of the crisis, go to Fox Nation and sign up today.
For more information on the coronavirus pandemic, watch «America Vs Virus» with Dr. Mehmet Oz, «Pandemics and Epidemics 101,» with Dr. Nicole Saphier, a full-time practicing physician at Memorial Sloan Kettering Cancer Center and «Fox Nation 101: Making Vaccines,» with Dr. Amesh Adalja, a senior scholar at the Johns Hopkins University Center for Health Security.
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Fox Business’ Megan Henney contributed to this report.
