Source: Washington Examiner —
For months, economists, academics, and elected officials have argued about whether the United States is in a recession. The “yes” camp points to negative gross domestic product growth in the first two quarters of 2022, meeting the term’s technical definition. Skeptics, meanwhile, point to the strong labor market.
Either way, there are plenty of reasons to worry about the economy’s trajectory. Inflation is still a major concern, at a 40-year high. A recent National Association of Business Economists survey found that 73% are not confident that the Federal Reserve can tamp down inflation while avoiding a recession in the next two years. And just over 1 in 10 business economists feel confident in the central bank’s ability to do so.
Biden administration officials, too, are trying to downplay economic expectations. Officials said on Aug. 23 that they expect slower economic growth and significantly higher inflation this year than they had predicted, as rising prices continued to complicate the nation’s return to a normal state of affairs.
All of which is keeping business economists and others busy trying to game out which industries, products, and stocks may be able to survive, or even thrive, during an economic downturn, and those likely to face a world of economic pain and uncertainty over long-term prospects. Here’s a rough idea.
The Most Threatened
Housing is near the top of industries threatened by a recession. The current economic downturn is due at least in part to the Fed hiking interest rates at a historic pace in its bid to puncture runaway inflation. That makes borrowing costlier, particularly for home mortgages.
After an unprecedented two years of interest rates kept at near-zero levels, the Fed in March finally raised rates by a relatively modest quarter percentage point. But with inflation persistently high, the Fed in May followed up with a more aggressive half-percentage point, or .50 basis point, interest rate increase. That was the biggest interest rate increase since 2000.
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