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Is the US economy headed for a soft landing?

By Jeffrey Frankel

3 min read

informed Summary

  1. Despite the gloomy predictions made by many analysts, there is no reason to assume that the U.S. economy will experience a major downturn this year or in 2024, Jeffrey Frankel writes in PS.

CAMBRIDGE – A skydiver leaps out of an airplane and discovers that his parachute will not open. On his way down, he encounters a hang glider who asks him how he is doing. The free-falling man shouts back, “Okay, so far!”

For many, the US economy these days bears a striking resemblance to the parachutist. Ever since March 2022, when the Federal Reserve began to hike interest rates and shrink its balance sheet, the consensus among economists has been that the United States is headed toward a hard landing. Many economists have been confidently forecasting a recession for over a year, with some even asserting that the economy has already started to contract.

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