In nearly every aspect of public life, Kansas City leaders don't want to recognize economic reality.
Sure, there's a great deal of advocacy for
hobos the less fortunate, advocating for higher taxes or more spending. But overall, the impact of economics on the lives of locals is a topic that's habitually neglected.
Nevertheless . . .
RECESSION IS NOW INCREASINGLY 'LIKELY' AND ONCE AGAIN KANSAS CITY SEEMS UNPREPARED FOR ECONOMIC HARSH TIMES!!!
Here's the word from experts . . .
In an interview with Bloomberg Economics released on Thursday, Summers, a paid contributor to Bloomberg, said that “the odds on a hard landing within the next two years are certainly better than half, and quite possibly two-thirds or more.” One of the mechanisms that would bring about a recession is the central bank’s response to elevated inflation, Summers said, adding that “we’re not going to see disinflation back toward the target range until we see unemployment rise, meaningfully.”
The publication of Summers’s comments came just two days after the consumer price index data showed the annual headline U.S. inflation rate jumping to 8.5% in March, the highest level since 1981. The rate has remained well above the Fed’s 2% target for almost a year, putting central bankers under pressure to aggressively raise target lending rates. Expectations for higher rates are rippling out throughout the economy, with the average 30-year mortgage rate soaring to 5% for the first time in a decade. Meanwhile, financial-market participants continue to debate whether inflation has hit a peak.
We love data but let's unpack what this might mean for locals . . .
- Recession usually hits consumer spending first and this threatens a double dose of misery for local biz coming out of COVID.
- Higher interest rates are likely to worsen the housing crisis and keep supply limited given that the cash to build just isn't out there . . .
- The REALITY of investment dollars tightening up contradicts so much local hype about "growth engines" like a new stadium or the streetcar.
And, in fairness, locals won't have any control if the Fed FAILS in their mission and the US economy spins down a deflationary death spiral.
Don't worry, it gets worse . . .
One of the reasons local news hate covering this stuff is because bad news doesn't bode well for advertisers. Meanwhile, we're not even sure the newspaper has a biz section anymore.
Read more via www.TonysKansasCity.com links . . .
Recession is now the 'most likely' outcome for the U.S. economy, not a soft landing, Larry Summers says
Former Treasury Secretary Larry Summers, whose out-of-consensus views about the risks of persistent inflation have come true, is reiterating his concerns about a potential U.S. downturn: He now says a recession is "the most likely thing" partly because the Federal Reserve "is going to have to keep going [in its effort to subdue inflation] until we see disinflation."
Economic forecasters have downgraded their estimates of US economic growth this year, as the economy struggles with high inflation, higher oil prices caused by the war in Ukraine, and ongoing covid-related supply disruptions. There is now about a one-in-three chance that the US economy enters recession this year, according to a range of forecasters using different methods.
As Americans feel the squeeze of rising inflation, fears are growing that a recession is around the corner. The U.S. economy is running hot as a record stretch of job growth, steady consumer demand and intense demand for labor has helped fuel the highest inflation rate in 40 years.
Rising interest rates were a hot topic at the Vancouver Real Estate Forum on April 12, figuring into discussions of housing prices, affordability and investor returns. "We're seeing some impact right now, but I would suggest that it's more tied to the investor buyer pool," said Rowan Hicks, industrial sales director with Beedie.
The COVID-19 pandemic dealt the U.S. economy a massive blow in the spring of 2020. But thankfully, things have improved tremendously over the past two years. Unemployment is down on a national level and job availability is strong. But these conditions may not last forever.
Developing . . .