Trump predicts ‘spectacular’ rebound as economy plunges

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Trying to dispel economic gloom, President Donald Trump said on Thursday he is anticipating a major rebound in the coming months and a “spectacular” 2021.

While economists are warning of serious long-term damage as the United States plunges into recession because of coronavirus, President Trump is predicting a strong fourth quarter thanks to pent-up demand.

“I think we can actually surpass where we were,” he told reporters in the Oval Office, while admitting he was “relying on his gut”.

“I feel it,” he said. “I think sometimes what I feel is better than what I think, unfortunately or fortunately.”

President Trump’s comments came during a meeting with New Jersey Governor Phil Murphy, a Democrat, who exchanged praise with President Trump, despite past criticism.

President Trump said Mr Murphy had “stepped up to the plate”, while Mr Murphy said President Trump has delivered in his state’s darkest hour.

“We’ve been crushed and appreciate your consideration on the financial side as well,” Mr Murphy said, while telling President Trump his state needs 20-30 billion US dollars just to keep firefighters, teachers, police officers and others on the job.

The comments are the latest sign that President Trump is trying to turn the page on the virus, even as the nation’s death toll continues to climb and jobless claims rise.

President Trump had been hoping to ride a strong economy into another four-year term, but the virus and the economic damage it has wrought upended that strategy.

But economists have waned a sharp comeback may not be realistic. They point to expected flare-ups that could force reopened businesses to shut down again, concerns that employees and consumers afraid of contracting the virus could continue to stay home, and the fact that shuttered business may not open again.

With so much of the economy paralysed, the Congressional Budget Office has estimated that economic activity will plunge this quarter at a 40% annual rate.

President Trump has nonetheless given consistently high marks to his administration’s handling of the virus, despite persistent criticism that he waited too long to act.

“I think we did a spectacular job,” he said, days after the nation’s death toll surpassed the Vietnam War, with more than 60,000 dead and a million infected.

“I’m not even referring to me, I’m referring to all of these people, including your people who have been working with my people so closely,” he told Mr Murphy. “But the federal government has done a spectacular job.”

The nation’s top infectious disease expert said earlier on Thursday that new cases of the virus are a certainty as states begin to roll back restrictions.

States need to proceed carefully as they take steps to reopen businesses and allow greater freedom of movement, Dr Anthony Fauci said.

“We will get blips … there’s no doubt,” Dr Fauci told NBC’s Today show.

“When you pull back there will be cases, and what we need to do is make sure (states) have in place the capability of identifying, isolating and contact tracing individuals.”

Dr Fauci urged states that do not have that capability to go very slowly. “You can’t just leap over things and get into a situation where you’re really tempting a rebound. That’s the thing I get concerned about,” he said.

His warnings came a day after President Trump said the federal government would not extend its social distancing guidelines past Thursday, and his son-in-law and adviser, Jared Kushner, predicted that by July the country would be “really rocking again”, despite health experts assessing that as highly unlikely.

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