Robert Kiyosaki, the author of the book, ‘Rich Dad, Poor Dad,’ flagged the possibility of a European country going under, potentially the first country to earn this dubious distinction.
What Happened: Germany, Europe’s largest economy, is staring at the possibility of going bankrupt, Kiyosaki suggested on Friday. “First BANKS. Countries next,” the best-selling author tweeted.
“Will Germany be the first country to fail? Go Bankrupt?” he added.
The German economy contracted 0.3% in the three months to March after adjusting its initial estimate of zero growth, data from the Federal Statistical Office showed on Thursday. This followed a revised 0.5% contraction in the final quarter of last year, meeting the definition of a technical recession.
The statistical office attributed the predicament to falling consumer spending as prices remain stubbornly high.
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US To Follow Suit? Kiyosaki also fired another stark warning of America potentially following in the footsteps of Germany. “Will America default after Germany?” he asked.
First-quarter U.S. GDP data released on Thursday showed the economy growing at an upwardly revised 1.3% rate, propped up by a 3.8% jump in consumer spending. Key macro variables held up well so far.
That said, risks remain, including the banking crisis that claimed the scalps of three mid-tier banks and also the looming debt default.
If the government and the Republicans do not reach a deal on raising the debt ceiling before the June 1 deadline, the Treasury is expected to run out of cash. Treasury Secretary Janet Yellen, President Joe Biden and economists have warned of serious economic repercussions if a deal is not clinched.
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