Cathie Wood reiterated her view that the economy is in recession.
by DAN WEIL
Fiscal policy is one deflationary force. The growth of federal outlays is dropping sharply. { Build, Back, Better ?}
On the monetary front, in addition to the Federal Reserve’s interest-rate hikes, M2 money-supply growth has eased from 27% in 2020 to probably 5% in July. It could be down to 1% growth by the end of the year. “Monetary policy is restrictive”.
Gold doesn’t point to increasing inflation. Also, copper peaked last year, and oil crested in March of this year.
“Inventories have blown out. For example, builders are now stuck with home inventories". Companies have only one way to get rid of their excess inventory, and that’s by cutting prices.
Nonfarm-payroll numbers, which have shown strong growth in recent months, are a lagging indicator. “The leading indicator is household-employment numbers, which have dropped almost 200,000 in the last four months.”
We think the economy will come out of it in 2023, when most economists expect a recession to begin.
Source: The Street
https://www.thestreet.com/investing/cat ... BInflation
