Dow Jumps 500 Points Even As Experts Warn Recession Could Lead To Further Stock Selloff
ForbesJUN 2022
80% of economists see conditions lining up for a period of prolonged 'stagflation' in the US: high inflation rates combined with stubbornly low growth and lower employment. In fact, those conditions are baked into the Fed's current rate hikes - which signal lingering inflationary concerns - that will no doubt lead to higher unemployment.
So the era of cheap money is over, right? Hardly. The Fed is raising rates to fight inflation, but those inflationary pressures are most likely transitory. Once higher rates have brought inflation back down to a manageable - even desirable - level of 2-3%, rates are likely to return to their new lower normal.