THE SIGNS OF FINANCIAL GLOOM ARE SEEMINGLY everywhere. Inflation is now at its highest point in more than 40 years. Stocks officially fell into a bear market in June, dropping more than 20 percent from their peak in January. Bonds and cryptocurrency are bleeding red ink too, with Bitcoin losing over half of its value so far this year. And, as if all that weren't bad enough, economists are now warning in increasingly heated language about the rising risk of recession-a three-syllable term with four-letter-word implications.
By one common but unofficial definition of recession-two consecutive quarters of economic contraction the downturn could materialize within weeks, when estimates of GDP for the second quarter will be released. They're expected to show the economy shrank by about 2 percent on an annualized basis during the three-month period that ended on June 30, following a 1.6 percent drop in the first quarter. But it is up to academics at the
National Bureau of Economic Research, a private nonprofit group, to officially determine if the U.S. is in a recession, which it defines as a significant decline in economic activity that's spread across the economy and lasts more than a few months.
Predictions about if and when that official recession will arrive are all over the place. A recent paper by Federal Reserve economist Michael Kiley suggests there's a greater than 50 percent chance of a downturn between now and March. Meanwhile, Goldman Sachs and Morgan Stanley peg the probability of recession within a year at 30 percent, Deloitte forecasters put the likelihood at just 15 percent and BlackRock simply predicts "real economic pain" ahead as the Fed continues to raise interest rates (there have been three hikes already this year) in an effort to combat inflation.
This story is from the August 05, 2022 edition of Newsweek.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the August 05, 2022 edition of Newsweek.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
The States Keeping Their Children Hungry
The Summer Electronic Benefit Transfer could help feed millions of children in households experiencing food insecurity, yet 13 states have declined to participate in the program
The Secret to Being an ADHD Whisperer
Loosening up and ceding control are some of the most important strategies for making life easier for a neurodiverse loved one
Fertility Clinics 2024
FOR THOSE LOOKING TO EXPAN D THEIR FAMILIES, FERTILITY CLINICS CAN BE A VITAL OPTION
'I AM ALWAYS IN THE MOMENT'
India's prime minister on his goals, his critics and his 'god-gifted' ability to listen
MODI'S MOMENT
INDIA'S LEADER is SHAPING the COUNTRY in his OWN ASSERTIVE IMAGE
Resurgence of Global Mayhem
While the world watches Gaza, ISIS is gaining strength and momentum, building networks and preparing for strikes worldwide
Is It Time to Leave Syria?
The U.S. is reportedly considering withdrawing from the country, with pressure from Damascus amid deepening unrest in the region. Is this the right move? Two experts weigh in
Chris Perfetti
IF YOU'RE ONE OF THE MILLIONS OF AMERICANS SINGING THE PRAISES of ABC's Abbott Elementary, fear not, they've heard you. \"We love to hear it,\" says Chris Perfetti, who plays Jacob Hill on the Emmy-winning sitcom about teachers at a Philadelphia public school.
Divine Intervention
POPE FRANCIS' PROGRESSIVE REPOSITIONING OF THE CATHOLIC CHURCH HAS CREATED BATTLE LINES BETWEEN ITS 1.3 BILLION FOLLOWERS, NO MORE SO THAN IN THE UNITED STATES
Who Rules Gaza When the Fighting Stops?
With no clear leader coming to the fore, questions remain about how the devastated territory will be managed