Is Another Deep Recession On The Horizon For The American Economy – Winston Row & Associates

NEW YORK - Feb. 28, 2014 - PRLog -- According to the experts in Washington and Wall Street, “the good times are here again” are they? - for some they are.

There is a perfect storm looming on the horizon.

With the combination of the Health Care Reform ACT, increased Federal income taxes for this year, combined with a large number of student loans coming due in the jobless recovery and an interest rate rise as the Federal Reserve pulls back, will hamper home sales and consumer spending.

Here’s why.

There are only Four Million people signed up for the Health Care Reform ACT, far short of what the government expected. People who are expecting that tax return check at the end of April or early May are in for a big surprise.

Instead of that expected tax refund check, many Americans will either get nothing or receive a bill from the IRS, because there is a fine (not a tax) for not buying the government health insurance.

That they can’t afford in the first place.

As most Americans noticed this year, taxes went up. A few percent more of income may not seem like a lot to the Washington crowd.

However, that extra few thousand or hundred dollars could have been spent in the economy on luxuries like groceries, clothing or utilities.

In 2014 a record number of student loans are coming due. These are loans are non-dischargeable government debt.

These young people are either underemployed or unemployed, who can’t service the government debt.

This is creating class of Americans stuck in a credit desert that will have limited consumer spending power, if any, due to their low credit scores.

The Federal Reserve has made no secret that they will greatly curtail their purchase of treasuries (printing money).

Two things will happen; interest rates will rise causing home purchases to decline. Secondly, sales of durable goods like cars, washers and dryers and other house hold goods will tank.

American consumers will begin to see the stress in their own households at the end of May.

By September of 2014 the official Government numbers will be published at the end of the 3^rd Quarter.

Winston Rowe & Associates, who prepared this article, estimates that the unemployment rate will jump to 9% to10% for the official government rate, blaming it on summer (seasonal) workers returning to school.

Washington will then blame the slowing consumer spending on pent up consumer demand, just waiting for the holiday shopping discounts - sound familiar.

The good times are here again, if you have a Federal Government job or you work in Washington or for your local Government. They have even more of your money than ever.

For the rest of America, there are going to be some tough times ahead.

Winston Rowe & Associates, is a national commercial real estate advisory, consulting and due diligence firm. They specialize in working with clients that need out of the box creative financing solutions.

If you would like to contact Winston Rowe & Associates they can be reached at 248-246-2243 or visit them on line at http://www.winstonrowe.com