{"id":1379762,"date":"2022-03-15T09:08:40","date_gmt":"2022-03-15T13:08:40","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1379762"},"modified":"2022-03-15T13:22:09","modified_gmt":"2022-03-15T17:22:09","slug":"is-the-u-s-headed-for-a-recession-in-2022-heres-what-the-experts-say","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/is-the-u-s-headed-for-a-recession-in-2022-heres-what-the-experts-say\/","title":{"rendered":"Is The U.S. Headed For A Recession in 2022? Here\u2019s What The Experts Say"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">28<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fis-the-u-s-headed-for-a-recession-in-2022-heres-what-the-experts-say%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1379762&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div><img decoding=\"async\" src=\"https:\/\/dw-wp-production.imgix.net\/2022\/03\/Recession.jpg?w=1200&#038;h=800&#038;ixlib=react-9.3.0\" class=\"ff-og-image-inserted\" alt=\"image\" \/><\/div>\n<p>Since Joe Biden took office last year, the world has seen inflation, high gas prices, a top-down push to force the nation to adopt renewable energy, and a geostrategic crisis in Europe. The only thing Biden needs to fully reinvent the 1970s are bell-bottoms, disco, and a recession. Unfortunately, the latter appears to be on the way.<\/p>\n<p>A recession takes place when the economy shrinks for two quarters (or six months) in a row. Despite numerous economic woes, the U.S. economy continued growing in the <a href=\"https:\/\/www.bea.gov\/news\/2021\/gross-domestic-product-state-3rd-quarter-2021\">third<\/a> and <a href=\"https:\/\/www.bea.gov\/news\/2022\/gross-domestic-product-fourth-quarter-and-year-2021-second-estimate\">fourth<\/a> quarters of 2021. But trillions of dollars of U.S. government spending in the name of COVID-19 relief (millions of which were squandered on fraudulent purchases of sports cars, luxury homes, and even allegedly used to\u00a0<a href=\"https:\/\/www.dailywire.com\/news\/mercedes-mansions-and-murder-how-fraudsters-spent-millions-in-covid-relief-funds\">finance a contract killing<\/a>) drove up inflation to its highest rate in 40 years. To fight inflation, the Federal Reserve has indicated it will raise interest rates, which it has pegged at near-zero levels since March 2020.<\/p>\n<p>The Fed\u2019s return to tight-money policies alone had economists fearing a recession. Last month, George W. Bush\u2019s economic adviser, Lawrence Lindsey, put the likelihood of a recession at over <a href=\"https:\/\/www.forbes.com\/sites\/sergeiklebnikov\/2022\/02\/18\/recession-risks-are-rising-as-federal-reserve-scrambles-to-fight-inflation-experts-say\/\">50%<\/a>. Lest one think this is partisan, so did Lawrence Summers, the Treasury Secretary under President Bill Clinton and an economic adviser to Barack Obama. The only question for many prominent economists is the timing.<\/p>\n<p>Before the outbreak of military hostilities between Russia and Ukraine, economists had predicted a U.S. recession in <a href=\"https:\/\/finance.yahoo.com\/news\/next-recession-everything-bubble-burst-120100109.html\">2023, 2024<\/a>, even as late as <a href=\"https:\/\/www.forbes.com\/sites\/billconerly\/2021\/11\/02\/no-recession-in-2022-but-watch-out-in-2023\/?sh=5a3e31263555\">2025<\/a>. Summers predicted a recession within \u201cthe next 30 months,\u201d according to Forbes. Last December, Deutsche Bank\u2019s chief economist Jim Reid <a href=\"https:\/\/finance.yahoo.com\/news\/we-need-to-talk-about-2023-yes-already-morning-brief-101147700.html\">said<\/a> \u201cthe probabilities [of a recession] will build from 2023 onwards if history is to be believed.\u201d At the same time, Chapman University economists <a href=\"https:\/\/news.chapman.edu\/2021\/12\/16\/economy-will-grow-but-inflation-is-sticking-around-and-recession-is-likely-chapman-economists-say\/\">predicted<\/a> a recession would break out next year.<\/p>\n<p>But the economy responds to world events, particularly a war and its attendant sanctions against an oil-rich nation. \u201cIt seems obvious that the odds of recession are now well above average here in the United States,\u201d <a href=\"https:\/\/22vresearch.com\/2022\/03\/07\/gasoline-and-the-recession-risk\/\">wrote<\/a> Gerard MacDonell, an analyst at 22V Research, on Monday. \u201cRecession risks are rising,\u201d <a href=\"https:\/\/twitter.com\/Markzandi\/status\/1501194505076322312\">agreed<\/a> Mark Zandi of Moody Analytics on Wednesday. He put the odds of an economic contraction at \u201c[o]ne-in-three over the next 12-18 months.\u201d<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">This darkens the inflation outlook, as inflation expectations threaten to become unhinged. They are already high. See 5-year breakevens. The Fed would have a Hobson\u2019s choice, but would tighten more aggressively. Recession risks are rising. One-in-three over the next 12-18 months.<\/p>\n<p>\u2014 Mark Zandi (@Markzandi) <a href=\"https:\/\/twitter.com\/Markzandi\/status\/1501194505076322312?ref_src=twsrc%5Etfw\">March 8, 2022<\/a><\/p>\n<\/blockquote>\n<p>Others proved more pessimistic. The Bank of America\u2019s Michael Hartnett forecast that within the \u201cnext six months, [Federal Reserve interest] rates shock morphs into recession shock.\u201d<\/p>\n<p>Worse yet, some believe the recession has begun. \u201cI\u2019m basically a data scientist, and I work in commodities, and I think we\u2019re already in one,\u201d Campbell\u00a0Faulkner, senior vice president at OTC Global Holdings, <a href=\"https:\/\/www.foxbusiness.com\/economy\/us-recession-inflation-40-year-high\">told<\/a> FOX Business last Thursday. \u201cI just think because of the lags in the data, we\u2019re not going to see it yet.\u201d<\/p>\n<p>What\u2019s driving all this? Oil and inflation.<\/p>\n<p>The war between Russia and Ukraine has caused already-rising gas prices to increase. Russia supplies <a href=\"https:\/\/www.dailywire.com\/news\/running-on-empty-how-bidens-anti-energy-policies-helped-build-putins-war-machine\">11% of the world\u2019s oil<\/a>, including nearly five million barrels of crude oil a day as of 2020. On Tuesday, President Biden <a href=\"https:\/\/www.dailywire.com\/news\/biden-announces-ban-on-russian-oil-imports-in-bid-to-hold-putin-accountable\">announced<\/a> he would ban all Russian oil imports to hold President Vladimir Putin accountable. While most Americans support the sentiment, it is a policy that will raise their prices and potentially lead to a recession.<\/p>\n<p>If the U.S. and Europe ban Russian oil, investment banks Goldman Sachs and\u00a0Barclays <a href=\"https:\/\/www.reuters.com\/markets\/europe\/goldman-raises-oil-price-forecasts-russia-supply-shock-2022-03-08\/\">predict<\/a>\u00a0oil prices will increase to $200 a barrel \u2014 nearly a $60 increase. Rystad Energy predicts <a href=\"https:\/\/fortune.com\/2022\/03\/09\/worst-case-oil-forecast-240-per-barrel-global-recession\/\">$240 a barrel<\/a>. \u201cOil at $240 per barrel would trigger a global recession,\u201d said Rystad\u2019s Bj\u00f8rnar Tonhaugen.<\/p>\n<p>Increasing energy prices affect everything in the economy \u2014 but they fall hardest on average Americans. \u201cIt doesn\u2019t matter if the price of gas is $5 or $50 for [Bill] Gates or [Jeff] Bezos, but for most of us, it\u2019s a big deal,\u201d Campbell Harvey, a professor of finance at Duke University, <a href=\"https:\/\/www.wral.com\/as-gas-prices-increase-duke-professor-warns-of-potential-recession\/20176935\/\">told<\/a> WRAL.com.<\/p>\n<p>Oil need not reach that price to trigger an economic contraction. \u201cNearly all post-war recessions have been preceded by oil-price shocks,\u201d <a href=\"https:\/\/warwick.ac.uk\/fac\/soc\/economics\/research\/workingpapers\/2008\/twerp_809.pdf\">wrote<\/a> economists at the University of Warwick in 2007, concluding that \u201coil-price spikes can be a source of recessions.\u201d Spikes in the cost of oil in 1973, 1979, and 1990 all presaged recessions the following year. \u201cDisruptions to oil markets and recessions have gone hand in hand throughout the post-war period,\u201d <a href=\"https:\/\/www.everycrsreport.com\/reports\/R40198.html#_Toc274738129\">concluded<\/a> the\u00a0Congressional Research Service in 2010.<\/p>\n<p>\u201cThe Biden administration has to be more successful at convincing folks that they\u2019re not out to crater Russian oil exports,\u201d <a href=\"https:\/\/www.youtube.com\/watch?v=EYcy__ucs8g\">said<\/a> former George W. Bush adviser Bob McNally, the president of Rapidan Energy Group. \u201cAs long as there\u2019s a fear \u2026 that we\u2019re trying to go and try and block all those exports, the economy is heading towards a recession.\u201d<\/p>\n<p>The oil price hike also need not occur in the United States to cause a U.S. recession. Moscow has threatened to withhold energy from western Europe, whose <a href=\"http:\/\/theconservative.online\/old\/index.php\/archive-article\/the_winter_of_our_disconnectgreen_energy_policies_leave_europe_out_in_the_c\">green energy policies<\/a> have left them dependent on Russian fossil fuel imports. \u201cMy greatest fear is that these prices have risen so fast that you cause a recession in Europe and Latin America, that rolls on into the United States,\u201d Andy Lipow, the president of Lipow Oil Associates, <a href=\"https:\/\/www.cnbc.com\/2022\/03\/09\/analysts-on-inflation-recession-after-russian-oil-bans.html\">told<\/a> CNBC on March 9.<\/p>\n<p>Key Biden administration officials have said Americans could avoid spiking gas prices by purchasing electric vehicles (EV). Transportation Secretary Pete Buttigieg <a href=\"https:\/\/www.dailywire.com\/news\/tell-me-youre-a-liberal-elite-without-telling-me-youre-a-liberal-elite-cruz-rips-buttigieg-pushing-evs-while-gas-prices-soar\">said<\/a> on Monday, \u201cClean transportation can bring significant cost savings for the American people as well. Last month we announced a $5 billion investment to build out a nationwide electric vehicle charging network, so that people from rural to urban to suburban communities can all benefit from the gas savings of driving an EV.\u201d The White House <a href=\"https:\/\/twitter.com\/whitehouse\/status\/1501947079022706695\">tweeted<\/a> on Thursday, \u201cWhen we have electric cars powered by clean energy, we will never have to worry about gas prices again. And autocrats like Putin won\u2019t be able to use fossil fuels as weapons against other nations.\u201d<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">When we have electric cars powered by clean energy, we will never have to worry about gas prices again. And autocrats like Putin won\u2019t be able to use fossil fuels as weapons against other nations.<\/p>\n<p>\u2014 The White House (@WhiteHouse) <a href=\"https:\/\/twitter.com\/WhiteHouse\/status\/1501947079022706695?ref_src=twsrc%5Etfw\">March 10, 2022<\/a><\/p>\n<\/blockquote>\n<p>The Biden administration appears to be blissfully unaware that the lithium-ion batteries which power those electric vehicles <a href=\"https:\/\/www.wsj.com\/articles\/how-wars-costs-reach-far-shoresto-american-farms-supermarkets-retailers-11646597823\">require nickel<\/a> \u2014 and Russia is a key exporter of nickel. While the administration may not know this fact, the markets do. Nickel prices soared 90% on Monday, to <a href=\"https:\/\/markets.businessinsider.com\/news\/commodities\/nickel-prices-russia-ukraine-production-shortage-ev-steel-commodities-invasion-2022-3\">$55,000<\/a> per metric ton; the price then doubled again Tuesday, settling at more than $100,000 per ton. The price so concerned traders that the London Metal Exchange <a href=\"https:\/\/www.cnbc.com\/2022\/03\/08\/russia-nickel-trading-suspended-in-london-after-prices-hit-100000.html\">suspended<\/a> all trading on nickel later on Tuesday. Analyst Adam Jonas of Morgan Stanley <a href=\"https:\/\/www.cnbc.com\/2022\/03\/08\/nickel-surge-just-raised-the-input-cost-for-an-electric-vehicle-by-1000-morgan-stanley-estimates.html\">wrote<\/a> that Monday\u2019s price alone represents \u201ca $1,000 increase in the input cost of an average EV in the U.S.\u201d He did not say how much that would raise the <em>consumer\u2019s<\/em> cost.<\/p>\n<p>All of this ignores the concern economists first raised when they talked about recession: The Federal Reserve tightening interest rates. A temporary increase in the price of oil could force an even greater contraction, leading to a U.S. recession. \u201cA surge in energy prices could require even more aggressive tightening than would otherwise have been the case, increasing the risk of the central bank accidentally tipping the economy into recession,\u201d <a href=\"https:\/\/www.aei.org\/op-eds\/the-economic-consequences-of-the-war-in-europe\/\">wrote<\/a> Michael Strain of the American Enterprise Institute (AEI) last Thursday.<\/p>\n<p>None of this is set in stone. As the old joke goes, \u201cEconomists have predicted 30 of the last five recessions.\u201d\u00a0But the signs are bad, and the poor and middle class will be the first to suffer from policies imposed by the rich and powerful.<\/p>\n<p><em>The Daily Wire is one of America\u2019s fastest-growing conservative media companies and counter-cultural outlets for news, opinion, and entertainment. Get inside access to The Daily Wire by becoming a\u00a0<\/em><a href=\"https:\/\/www.dailywire.com\/subscribe\"><em>member<\/em><\/a><em>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Since Joe Biden took office last year, the world has seen inflation, high gas prices, a top-down push to force the nation to adopt renewable energy, and a geostrategic crisis<\/p>\n","protected":false},"author":1,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1379762","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1379762","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1379762"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1379762\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1379762"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1379762"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1379762"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}