Stagflation is particularly difficult to correct because the usual correction methods used for one issue can make the other issues worse. In the first quarter of 2022, the US GDP decreased 1.6% year-on-year. In the second quarter, it contracted 0.9%. The Conference Board predicted this economic weakness would lead to a recession before the end of 2022. The Conference Board predicts that a “broad downturn” will hit the US economy soon. Their projections show that Real GDP growth would hit 1.3% in 2022 but only 0.2% in 2023. As for consumer prices, the Federal Reserve predicts inflation to settle at 4.1% in 2022, 2.6% in 2023, and 2.3% in 2024. Keep in mind that the Fed’s target inflation rate is 2%.

Spending On Durable Goods Remains High in Industry, Drops Among Consumers: Data regarding the purchasing of durable goods, expensive items that will last at least three years, can give us a peek into the health of the economy. The durable goods market in the United States is valued at about $1 trillion.

Peak Globalization: The COVID-19 pandemic has led to a decline in globalization. The pandemic has caused a significant reduction in international trade, travel, and migration.

Recession: The global economy is currently experiencing a recession. The International Monetary Fund (IMF) predicts that the global economy will contract by 4.4% in 20203.

Quantitative Failure: Quantitative easing (QE) is a monetary policy used by central banks to stimulate the economy. However, there is a risk that QE could fail to stimulate the economy.

Demographics: The aging population in many countries is having a significant impact on the economy. The aging population is leading to a decline in the workforce and an increase in healthcare costs.

Climate Change: Climate change is having a significant impact on the economy. The cost of natural disasters is increasing, and there is a growing demand for renewable energy.

Robots and Automation: The use of robots and automation is increasing in many industries. This trend is leading to job losses in some industries but is also creating new jobs in other industries.

Splinternet: The internet is becoming increasingly fragmented, with different countries and regions having different rules and regulations. This trend is making it more difficult for businesses to operate globally.

Moral Capitalism: There is a growing demand for businesses to be more socially responsible. This trend is leading to a shift towards moral capitalism, where businesses are expected to consider the social and environmental impact of their operations.