President Barrack Obama's announcement that the budget deficit could swell to $9 trillion over the next decade — $2 trillion more than previously announced — means the end of the standard of living to which U.S. consumers are accustomed, says Howard Davidowitz, head of Davidowitz & Associates, a retail consultancy and investment bank.
“Barack Obama's numbers have all gone mad,” Davidowitz told Yahoo! Finance.
“His entire budget is discredited, we're off the charts. Living standards will never be the same and the American consumer can never and will never be the same,” Davidowtiz said.
Despite such grim budget forecasts, stock prices continue to climb, although similar events took place in the Great Depression, Davidowitz says, adding that some rallies hit 40 percent back then but didn't last.
“People were sucked in and ultimately were destroyed,” Davidowitz says.
Earlier this week, the White House projected a cumulative $9 trillion deficit between 2010 and 2019.
The overall national debt, which now stands at more than $11 trillion, could almost double to $20 trillion during that time.
The debt is the total sum the government owes, while the deficit is the yearly gap between revenues and spending.
Some lawmakers have expressed concern at government spending.
“If anyone had any doubts that this burden on future generations is unsustainable, they're gone,” Senate Republican leader Mitch McConnell told Reuters.
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