NEW YORK (AP) — Most business economists think the U.S. economy could avoid a recession next year, even if the job market ends up weakening under the weight of high interest rates, according to a survey released Monday.
Only 24% of economists surveyed by the National Association for Business Economics said they see a recession in 2024 as more likely than not. The 38 surveyed economists come from such organizations as Morgan Stanley, the University of Arkansas and Nationwide.
Such predictions imply the belief that the Federal Reserve can pull off the delicate balancing act of slowing the economy just enough through high interest rates to get inflation under control, without snuffing out its growth completely.
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High rates work to slow inflation by making borrowing more expensive and hurting prices for stocks and other investments. The combination typically slows spending and starves inflation of its fuel. So far, the job market has remained remarkably solid despite high interest rates, and the unemployment rate sat at a low 3.9% in October.
And I'm telling you that your approach to doing this is, rhetorically, disastrous. You come across as both smug and dismissive of people's suffering and anxiety -- and your response to reading me say that musn't be, "Well, this person is irrational and not willing to engage with data."
Yes, people are dissatisfied with basically... all of how modern nation states are organized and run, from government to business to day-to-day social interactions.
But the whole premise of democracy is that the people, in aggregate, know best how to direct our lives. And what poll after poll says is, people are frustrated in particular with the perceived decline in their purchasing power. That perceived decline comes directly from making more money and yet only being able to afford the life they had before the round of inflation started. The very "wage growth" that you are claiming has mooted the issue of inflation.
So, even if it's true that, on average, people's spending power is the same now as it was before the pandemic -- which may not be true, depending on whether the already wealthy, to whom most of the gains have gone since the pandemic, are skewing that average -- that is not a victory. It is, at best, a depressing reminder that people live in a system that cares more about aggregate statistics on a balance sheet than it does about their actual lives.