Morning Keynote Session – Dan North, Allianz Trade Economic North American Update (G)

The U.S. economy still has some steam left in it, with the labor market remaining as the last bastion of strength. Most other measures are showing a definitive decay. The Federal Reserve has been the main cause. First it created inflation by leaving too much easy money in place for too long. Then it waited far too long to attack that inflation, and by the time it did start tightening, the Fed was hopelessly behind the curve. As a result the Fed had to be highly aggressive in raising rates to slay inflation, and it will likely strangle the economy in the process. The destruction is clearly showing up in the housing market, manufacturing, consumption, the labor market, and now the banking sector. A recession starting in the middle of 2023 is quite likely.