https://www.businessinsider.com/recession-outlook-us-economy-job-market-fed-rates-hard-landing-2024-3Effects on 2024 election?
There's still a big risk of the US economy hitting a recession, Michael R. Strain wrote in Project Syndicate.
"The economic outlook is unusually murky, with different sets of indicators telling different stories," Strain wrote for Project Syndicate on Monday. "Some signs point to the economy being on the verge of cooling rather than running hot. But those indicators also suggest that a hard landing — a recession — is more likely than a soft landing."
There's also consumer spending, a major engine of the US economy, that is beginning to wobble. Retail sales fell in January, down 0.8% from the month before. And credit card delinquencies are on the rise. One top economist, David Rosenberg, has said we already have a "super-duper" credit bubble on our hands.
But a big red flag is consumer sentiment that's in recessionary territory, Strain wrote.
A soft landing is not completely off the table. The Fed could steer the US away from a recession without reheating the economy — but that's if elevated interest rates can tamp down the number of job vacancies in the labor market without destroying actual jobs, he said.
