Odd Man Out: Everyone Expects Recession Except Biden

Karl SalzmannOctober 20, 2022

Days after president says economy is ‘strong as hell,’ Bloomberg says recession is 100 percent certain

Karl Salzmann • October 19, 2022 2:30 pm

Economists widely predict a recession next year, the Wall Street Journal reported, puncturing President Joe Biden’s insistence that “our economy is strong as hell.”

Economists put the probability of a recession in the next year at 63 percent, up from 49 percent in July, according to a Journal survey published on Sunday. The economists surveyed gave “increasingly gloomy” forecasts for 2023, saying they expect GDP to “contract in the first two quarters of the year,” causing employers to cut jobs.

Bloomberg economists on Monday offered an even gloomier forecast, saying the odds of a recession are 100 percent. Bloomberg News described the forecast as a “blow to Biden” ahead of November’s midterms.

The Journal report came out the day after Biden pooh-poohed terrible economic numbers, telling reporters that “our economy is strong as hell.” Biden made the claim as he stumped for Democrats in Oregon, a traditionally deep-blue state that this year is leaning Republican.

The consumer price index last month spiked to 8.2 percent. Biden admitted last week that a recession is possible, though he tried to convince Americans that it would be “very slight.”

Biden two months ago signed Democrats’ so-called Inflation Reduction Act, which many economists said would have little to no effect on inflation. His possibly unconstitutional student debt cancellation scheme, meanwhile, will almost certainly increase deficit spending.

A “soft landing” for the precarious economy, which Biden administration officials predicted for months, is “a mythical outcome that never actually comes to pass,” University of Michigan economist Daniil Manaenkov told the Journal.

Journal forecasters also expect the labor market to weaken for years to come, saying unemployment will stay high through 2024.