WASHINGTON (Pakistan Point News / Sputnik - 03rd November, 2022) The Biden administration misjudged the current energy crisis and Democrats are expected to lose control of Congress in the midterm elections, former Lehman Brothers executive Lawrence McDonald told Sputnik.
US voters head to the polls for midterm elections on November 8 to determine who controls Congress, with Republicans poised to seize the House from the Democrats while the Senate struggle is expected to come down to the wire.
"They're gonna lose the House, they're probably going to lose the Senate and then we go into gridlock," McDonald said. "That's why bonds are starting to rally here, because it's going to be just massive gridlock for a couple of years."
McDonald, who served as the vice president of distress debt and convertible securities trading at Lehman Brothers, said the Biden administration misjudged the energy crisis and failed to secure US energy independence.
"When they (Democrats) took office, they attack the oil industry, there was like 12 to 18 months where there was no investment at all and now we're under invested," McDonald said. "We don't have the resources on the ground to get enough oil out to satisfy demand and the entire administration has misjudged the energy crisis."
Since 2021, energy prices have been surging worldwide as the global economy rebooted after the pandemic. The growth increased after the European Union and other Western states imposed sanctions on Russian oil and gas, disrupting supply chains amid surging demand.
A price cap on Russian seaborne oil, suggested by the G7 and expected to be implemented in December, and the decision by OPEC+ to curb production also strained the already tense global energy situation.
McDonald is co-author with Patrick Robinson of "A Colossal Failure of Common Sense," which is about the fall of Lehman Brothers and the 2008 financial crisis.
