Great News! Yellen Says No Sign of Recession, Krugman Says Economy Will Shrink

Hip, Hip Hooray! Perhaps the recession has left town, according to Janet Yellen, who sees solid growth and a strong labor market as positive signs the Fed's efforts to fight inflation are not hurting the economy significantly. I guess she doesn't drive, fill up her car, eat food, or buy groceries. 

Janet Yellen said she doesn’t see signs of a recession, but Nobel laureate Paul Krugman argues the worst is yet to come | Fortune 

But the good news is Paul Krugman speaking up in disagreement with the Treasury Secretary. Krugman sees an upcoming downturn: "While this report made all the people who screamed 'recession!' look as foolish and partisan as they were, it was not, if you look under the hood, a sign that the worst is over," Fortunately the Krugman prediction phenomenon can be put into play here. He does not get it right everytime, or some say, even most of the time. So, in fact, he may be in agreement with Yellen, using some obscure prediction logic analysis. Be keep in mind, past performance does not indicate future performance.

The Daily Caller has categorized the Krugman prediction phenomenon. Here Are Paul Krugman’s Worst Predictions Ever–They’re Really Bad | The Daily Caller

Recession Alert! Bloomberg Calls It 100% Certain! Prepare!

Bloomberg has predicted the absolute certainty of a US economic recession in 2023, most likely before October. The economic model may mean the Federal Reserve has gone too far in raising interest rates in their thus far futile attempts to constrain inflation.

No model is certain, just an educated guess disguised as a mathematical projection by experts. Have faith, these experts are not always right. But this one seems pretty dire any way you look at it, especially when we have a flock of other experts parroting similar outlooks. 

Your best bet? Beware and Prepare! The next Fed meeting November 1-2 may give us some direction. 

The stock market is highly volatile right now. Be careful! Watch for a 'risk-off' flight to quality. And CD's are becoming more and more attractive for safety and income. 

Bloomberg: https://www.msn.com/en-us/money/markets/forecast-for-us-recession-within-year-hits-100-in-blow-to-biden/ar-AA133nzh

But be sure of one thing, when the rate hikes stop, there will be a few months of wait and see, then we might just see one great stock buying opportunity.

Can the Fed Deliver a Soft Landing? Maybe!

The Fed has a chance to avoid a deep prolonged recession and avoid the disaster that it would entail. They may even come to their collective senses. 

There is a voice of reason from Chicago Fed President Charles Evans in his optimistic speech to a National Association for Business Economics conference could be heard clearly describing a path to a soft landing.

Check it out: Evans: Close Alignment On Rate Hikes, Still Chance For Soft Landing – Options Trading Report

So, is the rest of the Fed Board listening? 

Thursday will bring a lot of information, Inflation and unemployment rates being the most anticipated. Maybe the economic tailspin we are in right now can be stopped before we crash.

The Enemy Approaches Unseen - and Will Strike Soon!

Inflation is a killer. In more ways than most imagine, by higher prices up the chain from manufacturing, food production, then transportation, distribution, and final delivery. With the QE Train at full speed, it is only a matter of time before it strikes, and strikes hard. The only question is whether there will be a brief deflationary period before the monster surfaces.

And now we find the 'experts' are predicting 'explosive inflation'.

Quoting the article at Zerohedge, 'In short: the Fed's DSGE models fail when applied in real life, they are unable to lead to the desired outcome and can't predict the outcome that does occur, and furthermore there is no way to test them except by enacting them in a way that consistently fails. But the kicker: the Fed's own model predicts that if the Fed does what it is currently doing, the result would be "explosive inflation."'

Read more: Explosive Inflation Predicted

Beware and Prepare!