Larry Summers warns a U.S. recession is coming before Washington can prevent it

It’s very interesting to see as of late a lot of high-profile individuals warning of a recession. Prior to the last economic collapse, everyone was talking about how rosy the national economy was and that everything was just fine. Certain people who warned of a recession were just laughed at (ahem, Ron Paul, ahem) by presidential candidates, economists and media pundits.

Well, it seems the talk of a recession has shifted into overdrive as another person has come out in favor of the position that a recession is on the doorstep of the United States.

Larry Summers, former Treasury Secretary, ex-Obama economic advisor and now Harvard professor, wrote in the Washington Post that a recession could engulf the U.S. before any of the country’s leading officials can prevent it from happening. This comes as the Federal Reserve could raise interest rates later this month.

“No postwar recession has been predicted a year ahead by the Fed, the administration or the consensus forecast,” wrote Summers. “The chances are very high that recession will come before there is room to cut rates enough to offset it.”

He added that no matter what the Fed does in terms of interest rates it will leave policymakers figuring out what are the best measures to contain a recession.

“The experience of the U.S. and others suggests that once a recovery is mature the odds of it ending within two years are about half and of it ending in less than three years over two-thirds,” he stated. “Because normal growth is now below 2 percent rather than near 3 percent, as has been the case historically, the risk may even be greater now.”

Summers believes the central bank will hike rates for the first time since 2006. “The Fed will in all likelihood lift rates this month. Markets will focus on the pace of the Fed’s tightening. I hope and expect that their response will involve no great turbulence.”