(OPINION) Talk of a recession, rough inflation data, and the persistent increase in costs of certain staple goods has got Wall Street’s biggest investors living in fear of an economic nightmare.
The Bureau of Labor Statistics released a bevy of data last week, and it was a mixed bag. While gas prices fell, grocery costs were up by 13.5% in the past year — the largest increase since 1979 — and health insurance costs jumped 24.3%, the largest in US history.
The data leaves investors uncertain over whether the US Federal Reserve can avoid a hard landing or navigate a soft landing, and the plan to shake higher prices out of the system is proving difficult.
The nightmare is not simply the economy tipping into a recession. It is much worse than that. Disappointing data from the BLS could see the economy get stuck. Inflation might come down slightly, but it remains high enough that the cost of important items like food and toiletries remain stubbornly high.
To make matters worse, higher interest rates will swell mortgage rates and credit-card repayments. All of this while wage growth remains stagnant and companies tighten their own purse strings on growth. Basically, the economy is stuck in a rut. For more, check out this piece from Insider’s Linette Lopez on Wall Street’s nightmare. (Insider)