Eminent Economist Warns of Federal Reserve's Potential Historic Mistake

As all eyes turn to the Federal Reserve's upcoming interest rate decisions, economist Henrik Zeberg has voiced concerns about the institution's handling of the economy. In a post on the social network X, Zeberg expressed worry about what he sees as the Federal Reserve's significant policy error. He believes that the current interest rate policy could result in severe deflation and a deep recession. By comparing current economic indicators with those before the 2001 recession and the 2007 financial crisis, Zeberg argues that the current economic situation is more perilous. He pointed to indicators such as GDP growth, nonfarm payrolls, the unemployment rate, inflation, and the two-year Treasury yield, which, he said, paint a concerning picture. Zeberg cautioned that persisting with the Federal Reserve's current policies could lead to a severe recession.