{"id":1781111,"date":"2022-12-20T08:45:44","date_gmt":"2022-12-20T13:45:44","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1781111"},"modified":"2022-12-20T08:48:29","modified_gmt":"2022-12-20T13:48:29","slug":"businesses-brace-for-the-worst-in-the-biden-economy-heading-into-2023","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/businesses-brace-for-the-worst-in-the-biden-economy-heading-into-2023\/","title":{"rendered":"Businesses Brace for the Worst in the Biden Economy Heading Into 2023"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">24<\/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%2Fbusinesses-brace-for-the-worst-in-the-biden-economy-heading-into-2023%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=1781111&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--><p>The question of whether or not the U.S. economy is in <a href=\"https:\/\/www.theepochtimes.com\/t-recession\">recession<\/a> remains one of the most hotly debated topics of 2022, yet corporate America is bracing for a slump in consumer spending. As high <a href=\"https:\/\/www.theepochtimes.com\/t-inflation\">inflation<\/a> depresses consumer demand, businesses of all sizes expect the economy to worsen in 2023.<\/p>\n<p>Consumer spending has kept the U.S. economy afloat over the last year, but it is unclear whether this pace of spending will be sustained in the coming year as household budgets become further stressed.<\/p>\n<p>Bank deposits have fallen by <a href=\"https:\/\/fred.stlouisfed.org\/series\/DPSACBW027SBOG\" target=\"_blank\" rel=\"noopener\">$340 billion<\/a> since their peak in April, indicating a weakening savings buffer. The personal savings rate as a share of disposable income fell to\u00a0a 17-year low of <a href=\"https:\/\/fred.stlouisfed.org\/series\/PSAVERT\" target=\"_blank\" rel=\"noopener\">2.3 percent<\/a> in October. And consumers are increasingly turning to credit cards to make ends meet in the face of rising prices.<\/p>\n<p>With household budgets squeezed and Americans <a href=\"https:\/\/www2.deloitte.com\/us\/en\/insights\/economy\/consumer-pulse\/state-of-the-us-consumer.html\" target=\"_blank\" rel=\"noopener\">signaling<\/a> future spending cuts, business leaders are worried about a dip in revenues and the need to lay off personnel.<\/p>\n<p>Profit outlook for S&#038;P 500 <a href=\"https:\/\/www.theepochtimes.com\/t-companies-2\">companies<\/a> also reflects the economic weakness ahead. Analysts now expect fourth-quarter earnings to fall by <a href=\"https:\/\/insight.factset.com\/sp-500-cy-2022-earnings-preview-ex-energy-sp-500-expected-to-report-decline-in-earnings\">2.8 percent<\/a>, according to FactSet. This would be the first drop since the third quarter of 2020, when the pandemic was at its peak. In the last five years, average profit growth of S&#038;P 500 companies was 14.3 percent.<\/p>\n<p>\u201cIf a recession is coming in 2023, it will be the most widely anticipated recessions of all times,\u201d Ed Yardeni, president of Yardeni Research said in a note. \u201cIt would be the first time that we\u2019ve collectively talked ourselves into a recession,\u201d he said, adding that some of the most vocal pessimists are bankers.<\/p>\n<p>Executives of the largest U.S. banks are warning that rising prices would dampen consumer spending, which makes up around 70 percent of the U.S. GDP.<\/p>\n<p>\u201cEconomic growth is slowing,\u201d Goldman Sachs CEO David Solomon said on Dec. 6 at a conference hosted by the investment bank. \u201cWhen I talk to our clients, they sound extremely cautious.\u201d<\/p>\n<p>Goldman Sachs is <a href=\"https:\/\/www.wsj.com\/articles\/goldman-sachs-plans-thousands-of-layoffs-expects-to-eliminate-some-bonuses-11671212043\">reportedly<\/a> planning to lay off thousands of staff, as it prepares for an unpredictable economic environment in the new year. It will be the latest big bank to cut jobs due to a sluggish economy and Wall Street activity.<\/p>\n<p>Many executives, including the CEOs of JPMorgan, GM, Walmart, United, and Union Pacific, are also preparing for a slowdown in consumer spending and business activity. Among the <a href=\"https:\/\/www.cnbc.com\/2022\/12\/06\/recession-walmart-jpmorgan-gm-ceos-talk-about-possible-slowdown.html\" target=\"_blank\" rel=\"noopener\">challenges<\/a> they mention are rising interest rates, inflation, geopolitical tensions, and stressed supply chains.<\/p>\n<p>\u201cIt could be a hurricane. We simply don\u2019t know,\u201d JPMorgan Chase CEO Jamie Dimon told CNBC.<\/p>\n<p>Main Street is also expecting choppy waters in 2023 particularly owing to high inflation and tightening credit conditions.<\/p>\n<p>Nearly <a href=\"https:\/\/www.cnbc.com\/2022\/12\/09\/main-street-says-weve-dodged-recession-so-far-but-downturn-is-coming.html\" target=\"_blank\" rel=\"noopener\">40 percent<\/a> of small business owners believe the U.S. economy will enter a recession in 2023, up from 26 percent in the third quarter, according to the latest CNBC\u2013SurveyMonkey survey. Most respondents anticipate the recession to begin in the first half of next year.<\/p>\n<figure id=\"attachment_4839243\" class=\"wp-caption alignnone\"><a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/12\/us.fed_-1200x800-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"lazy wp-image-4839243 size-large\" src=\"https:\/\/www.theepochtimes.com\/assets\/themes\/eet\/images\/white.png\" data-src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/12\/us.fed_-1200x800-1.jpg\" alt=\"us.fed\" width=\"640\" height=\"427\"   style=\"display:none\"><figcaption class=\"wp-caption-text\"><noscript><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-4839243 size-large\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/12\/us.fed_-1200x800-1.jpg\" alt=\"us.fed\" width=\"640\" height=\"427\" \/><\/noscript><\/figcaption><\/a> Traders work on the floor at the New York Stock Exchange as the Federal Reserve chairman Jerome Powell speaks after announcing a rate increase in New York on Nov. 2, 2022. (Seth Wenig\/AP Photo)<\/figure>\n<p>Following its final policy meeting of the year on Dec. 14, the Federal Reserve put financial markets on notice that officials were nearly unanimous in their assessment that interest rates needed to rise further and remain at high levels for longer to fight inflation.<\/p>\n<p>Former Treasury Secretary Larry Summers believes the Fed is making the right call this time to focus on lowering inflation despite increasing concerns about an economic recession.<\/p>\n<p>According to Summers, one of the problems is that salaries are still catching up with inflation and labor markets remain extraordinarily tight.<\/p>\n<p>There is no reason to believe that inflation is under control \u201cuntil wage inflation declines significantly or we get clear evidence of a productivity acceleration,\u201d Summers wrote in a recent Washington Post op-ed.<\/p>\n<p>\u201cUnfortunately, all major reductions in inflation in the past 70 years have been associated with recessions,\u201d he noted. \u201cIt should come as no surprise that many economists, including me, expect a recession to begin in 2023.\u201d<\/p>\n<div class=\"author_wrapper\">\n<div class=\"one_author_block round\">\n<div class=\"top_row\">\n\t\t\t\t\t<a href=\"https:\/\/www.theepochtimes.com\/author-emel-akan\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/10\/15ef0812da90bd74_ttl7dayCNO_WEB_EmelAkan-1.jpg\" alt=\"Emel Akan\" \/><\/a>\n\t\t\t\t\t<\/div>\n<p>Emel Akan writes about business and economics. Previously she worked in the financial sector as an investment banker at JPMorgan. She graduated with a master\u2019s degree in business administration from Georgetown University.<\/p>\n<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The question of whether or not the U.S. economy is in recession remains one of the most hotly debated topics of 2022, yet corporate America is bracing for a slump<\/p>\n","protected":false},"author":1,"featured_media":1781114,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[8016,3620,5458,7688,6002,9168,3835,3819,6044],"class_list":["post-1781111","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report","tag-8016","tag-biden","tag-bongino","tag-brace","tag-businesses","tag-economy","tag-heading","tag-report","tag-worst"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1781111","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=1781111"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1781111\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1781114"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1781111"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1781111"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1781111"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}