As the Fed tightens monetary policy, a banking crisis is historically the first evidence that something was breaking. "Last week, amid a rash of bank insolvencies, government agencies took action to stem a potential banking crisis. Banks quickly tapped the program, as shown by the $152 billion surge in borrowings from the Federal Reserve.
Federal Reserve officials are expecting a decline in economic activity through the rest of the year as implied by new economic projections published this week.
By Lance Roberts Could the consensus view of a "no recession" scenario be wrong? "Our most critical bullish signals are the short- and intermediate-term Moving Average Convergence Divergence indicators. While the technical backdrop continues to confirm and reaffirm a bullish trend supporting the "no recession" scenario, there remain substantial risks to that view.
Allianz chief economic adviser and noted economist Mohamed El-Erian believes monetary policy has been driven with "pedal to the metal" and that policymakers didn't slow it down with time. "And then we slammed on the brakes.
The Federal Reserve is expected to raise its benchmark rate by a quarter of a percentage point next week. What Happened: While inflation remains high, Siegel argues that the Fed's rate hikes are starting to show their effect. "Every recession in the last 50 years has followed an inversion - something blows up, something goes wrong," the Professor said.
President Joe Biden's budget proposal intends to reduce the U.S. deficit by nearly $3 trillion over the next 10 years, surpassing the $2 trillion figure the administration aimed for earlier.
Bank of America Chief Executive Officer Brian Moynihan reportedly stated on Tuesday the U.S. economy would hit a technical recession beginning in the third quarter. A U.S. recession would not be deep and the bank estimates that interest rates would start falling in the second quarter of 2024, Moynihan told The Financial Review’s Business Summit, according to a Reuters report.
The SPDR S&P 500 ETF Trust rallied on Friday after investors got two encouraging data points about the health of the U.S. services sector. The Numbers: The S&P 500 Global U.S. Services PMI index increased from 46.8 in January to 50.6 in February, its highest level since June of last year. Any level above 50 for the index is considered indicative of expansion.
Allianz chief economic adviser and noted economist Mohamed El-Erian reportedly said every time the central bank falls behind, the risk of the central bank pushing the economy into recession goes up. "The minute you go to the 10-year, you know you are bringing in a whole set of other issues including growth.
As if the 2020s haven't been strange enough, the United States military recently shot down several UFOs. The last few years have been humbling for economists, the Fed, and investment professionals. While the economy may seem unpredictable, the economic future is predictable.
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