If you are a follower of the economic news, you are aware of the fact that manufacturing is slowing down at the midpoint of this year. This is not a good sign as it means that we are entering the K-shaped recovery, a hangover that will lead to a recession. Also, the Federal Reserve is prepared to push the economy into recession, if necessary.
Prices rose 7.1% annually in November
The Consumer Price Index (CPI) rose at an annual rate of 7.1% in November. That was below economists’ expectations of a 73% year-over-year increase, but it was still the best rate since December 2021.
This figure follows two consecutive monthly price increases of 0.4%. Still, it shows that the U.S. is lagging in the war against inflation. Economists have questioned whether the Fed can keep the economy at “normal” levels.
While the CPI has been trending downward since June, it is still above the Federal Reserve’s goal of 2% annually. As a result, President Joe Biden said that “the nation may face more setbacks in its efforts to control inflation.” He added that the government remains “uncertain” about its future path.
Food costs were the biggest contributor to the rise in prices in November. The United Nations food index, which measures monthly changes in international prices of a basket of food commodities, stood just marginally above its value one year ago. However, global wheat prices remain substantially higher than in the past two years.
Immigrants are a major contributor to economic growth
In addition to being a source of jobs for Americans, immigrants also help to keep our domestic industry competitive. By adding high-skilled workers, we can remain competitive in many areas. And the economy as a whole benefits because they contribute billions of dollars in taxes each year.
Immigrants have long been an important part of the U.S. economy, but recent research has found that their contributions have become more significant in the last few years. A large part of this is due to increased education levels among newcomers.
Research indicates that immigration can positively affect the economy, as well as the quality of life. It is important to note that immigrants make a positive impact on the economy by increasing demand for goods and services. These products and services are then consumed by Americans. The more goods and services consumed, the more the economy will grow.
Research shows that immigrants are more likely to start their own businesses. Many of the Fortune 500 companies, including Goldman Sachs and LinkedIn, were founded by immigrants. Other companies founded by immigrants include Anheuser-Busch, Procter & Gamble, and eBay.
Fed prepares to push the economy into recession
The Federal Reserve is preparing to push the economy into recession next year. In fact, a recent poll shows that almost 100% of company CEOs are predicting a recession.
In response, Fed officials are raising interest rates. They believe this will help tamp down inflation. However, it could also lead to slower economic growth, which will increase unemployment.
In addition, the Fed’s policy may crimp business investment. Businesses are struggling to find workers and still have order backlogs. This could hold up manufacturing activity during a recession.
At the same time, the strong labor market and growing real spending are keeping the economy from slipping into recession. But with so many uncertainties weighing on the economy, it’s difficult to say what the Fed’s policy will do.
Some analysts are skeptical that the Fed will be able to strike a delicate balance. After all, it has two main goals: maintaining stable inflation and achieving maximum employment.