Bass says that "For the year I think you're going to see U.S. GDP down somewhere between 7% to 10% in real terms"

  • Citing of course the COVID-19 pandemic and the government's efforts to contain it
  • "10% is an economic depression" (Bass comparing the drop with the more than 10% drop in 1946 & the -12.9% in 1932 Great Depression)

China could be even more severe

  • shortage of U.S. dollars in the Chinese economy
  • Chinese Communist Party political crisis in Hong Kong (HK is a key conduit of foreign capital)
  • Chinese companies have taken on increasing levels of dollar-denominated debt to enable their purchases of foreign commodities like oil and agricultural products. "They are starting to look like a traditional emerging market, with a closed capital account and huge dollar-based borrowing"

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