Soaring inflation, rising energy and housing costs, and recent stock selloffs are causing economists and communities across the country to wonder what the economic future holds.
On Thursday the Dow tumbled 236 points, one day after seeing its biggest single-day drop since 2020 (1,000).
Some San Diegans are sharing their concerns about certain areas of the U.S. economy.
Rising housing costs are a major concern for many people.
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“I think cost of living is just insane, especially now buying a house. I’m 32 and it’s impossible to buy a home. Will I be 50 before I can buy a home, I don’t know,” San Diegan Jenna Tarpley said.
University of Southern California professor Rodney Ramcharan detailed the complexity of the current economic situation.
“We've never been in a pandemic in the modern times. The last time we had a pandemic was 1918, so the world was a fundamentally different place at that point. We're in a pandemic at the same time that there's a war that's taking place, that's disrupting the availability of oil and oil is a key ingredient in the economy,” Prof. Ramcharan said.
The U.S. Federal Reserve is attacking a major issue in the economy: inflation. Inflation hit a 40-year high in the first quarter of 2022 and the Fed has been raising interest rates to try and fight back.
Virtually all economists agree with the Federal Reserve taking action to lower inflation, but some worry raising interest rates too much or too fast could cause a recession.
If the U.S. slips into a recession some people are optimistic that it wouldn’t be a deep recession.
I think that If a recession comes, it's not going to be a depression. I don't think it's going to be like 2008 and 2009 where it was catastrophic. I think it will be awful for people that lose jobs. The unemployment rate will go up, but I can only speculate and say that this is likely to occur in the next 6-9 months, but after that, I think things will get better,” Prof. Ramcharan said.
The Federal Reserve will meet in June and raising interest rates again is reportedly on the table.