Clarko95 📚💰📈
Clarko95
YaBB God
Posts: 3,608
Political Matrix E: -5.61, S: -1.96
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« on: November 21, 2022, 06:18:42 AM » |
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Yeah 5% is probably the new minimum rate now.
Households still have enormous excess cash savings despite the drawdown over the past year; even low-income households have quite a bit of cash savings. Business investment, while slowing in growth, is still much higher than it was at the end of 2021. Consumers just keep on spending. Retail sales continue to be strong. Consumer debt has increased but not that strongly, given cash savings, and debt as a percentage of household income has only slightly increased and remains at "okay" levels. Bankruptcies have only barely ticked up.
Some people have speculated that inflation will probably drop sharply to 3-5% next year, still higher than what we want, and real wages will probably keep declining, and yes that does sound about right given the above, even if there is a mild recession in the U.S. (and there may not even be one?). Even the European economy has held up pretty well thus far despite the enormous price shock from energy that started 10 months ago.
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