The American economy continues to be under attack….
A pandemic causing shutdowns in production and buying…..
A slowdown in manufacturing also….
Business resuming with price increases to try to get back profits….
Changes in work habits for employee’s….
Absence ( and clawback) of government stimulus money…..
A conflict in the Ukraine that has actually driven energy prices skyward…
A inflation on going run….
A Fed hike in interest races against inflation that has already pulled the rug from under the housing market and will most definitely slow other things that are sensitive to interest rates….
Oh, and all this has begun to produce lay-offs…..
Joe Biden, and us consumers just ain’t catching any breaks…….
Ambrose Evans-Pritchard: “The New York Federal Reserve’s internal model is flashing an 80% risk that the US economy will enter a sustained contraction in the second half of this year, much sooner than presumed just weeks ago. The chances of a ‘soft landing’ have dropped to 10%. If so, you can stop worrying about an inflationary spiral.”
“The institution’s ‘dynamic stochastic general equilibrium’ model points to an outright fall in GDP of 0.6% this year and a further fall of 0.5% next year. It likens the current picture to the 1990 recession under George Bush senior, triggered by the First Gulf War.”
Hiring cuts are already beginning for bigger comoanies while smaller businesses are still looking for help….
During recessions, and during valuation shifts like we’ve seen in the markets in the last couple of months, unprofitable growth companies are getting killed. Their stock prices are collapsing,” Weber said.
The Federal Reserve is fighting the nation’s highest inflation in four decades by raising interest rates, a move that will curb consumer demand and likely bring down prices.
But economists say that rate hikes, which make it more difficult and expensive for companies to access capital, boost the likelihood that the U.S. goes into a recession next year.
The economic downturn is driving investors away from risky assets, including tech startup stocks that rarely deliver profits. The tech-heavy Nasdaq composite is down roughly 30 percent over the past year, while the big five tech stocks slid 36 percent over the same period.
Uber last month told employees it would lay off 3,700 people, and Spotify said this month it is slowing hiring by 25 percent. ….
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Last week, real estate tech companies Redfin and Compass each said they would lay off around 450 workers due to a slowdown in home buying demand sparked by interest rate hikes. That comes after insurance tech startup Policygenius laid off 25 percent of its workforce earlier this month. Online-only car retailer Carvana fired 12 percent of its workforce in May….
JPMorgan is laying off or reassigning more than 1,000 employees in its mortgage division as the housing market cools off….
Bloomberg