Higher interest rates will push the US economy into recession in the coming year, The Wall Street Journal reported on Sunday, citing its latest quarterly survey of economists.
According to the report, business and academic economists on average put the probability of a recession in the next 12 months at 61%. The forecast is slightly changed from 63% in October's survey.
The WSJ report indicated that the Federal Reserve had initially hoped it could bring down inflation with only a slowing in economic growth rather than an outright contraction, an outcome dubbed a "soft landing." However, three-quarters of respondents polled by the Journal said the Fed wouldn't achieve a soft landing this year.
The warning comes despite a slightly more optimistic outlook on inflation. The report said that, as measured by the year-over-year change in the consumer-price index, inflation has eased from 9.1% last June to 6.5% in December. Economists expect it to fall to 3.1% by the end of this year and see it ending 2024 at 2.4%.
Deutsche Bank economists told the WSJ in the survey:
"While recent inflation prints have shown some progress, a few persistent categories like core services are associated with the historically tight labor market, suggesting that there is still 'a long way to go' for the Fed. The Fed would stay on its tightening trajectory to restore the rebalance of labor market and price stability, which in our view would engineer a sharp rise in unemployment and recession."Meanwhile, chief economist at EY-Parthenon Greg Daco said that
"[w]hile services activity remains robust, the housing sector is tumbling under the weight of elevated mortgage rates and manufacturing activity is stalling - both signaling a broader economic downturn is likely coming."The expert expects the combination of persistent inflation, tighter financial conditions and weaker global growth will push the US economy into a mild recession in the first half of 2023.
Overall, economists said that a recession can't be avoided but that they expect it to be relatively shallow and short-lived.
On average, they expect gross domestic product to expand at a 0.1% annual rate in the first quarter of this year and to contract at 0.4% in the second. They see no growth for the third quarter and a 0.6% growth rate for the fourth, according to the report.
Bank on it 100%
Fabian Socialism Tactics 101 -
It’s by design. I’m told Fed (sanctioning its own citizens) taking away SNAP extra $95.00 benefit amount after February.
The cost of living increases do not add match the correct amount the Fed is adjusting for. The game is rigged. It’s more like a long grind of Fabian Socialism tactics named after Roman General Fabian who wore down his arch-enemies by attrition warfare.
The Fabian strategy is a military strategy where pitched battles and frontal assaults are avoided in favor of wearing down an opponent through a war of attrition and indirection. While avoiding decisive battles, the side employing this strategy harasses its enemy through skirmishes to cause attrition, disrupt supply and affect morale. Employment of this strategy implies that the side adopting this strategy believes time is on its side (this is the super dirty Chronos/Zurvan/Abaraxas/Chunoubis), usually because the side employing the strategy is fighting in, or close to, their homeland and the enemy is far from home and by necessity has long and costly supply lines. It may also be adopted when no feasible alternative strategy can be devised.
the rest is all Political Garnish & theatre … 🤡💩🎪