Are We Headed Toward a Recession?

For two quarters in a row, the gross national product has declined. This raises fears we may be entering a recession. However, the job market remains strong, thus leading many economists to doubt a recession is imminent. But what does the future hold?
The National Bureau of Economic Research’s (NBER) Business Cycle Dating System, which includes economists, believes labeling a recession requires a significant decline in all economic activities for several months. Indicators they study include consumer spending, public construction, housing starts, personal income, employment, business sales, and industrial production.
At the current time, despite higher interest rates, the economy has not slowed and unemployment is at its lowest in several years. Thus, the NBER concludes we are not in a recession but could enter one by the latter part of 2023.
Inflation, Recessions and Money Supply
Most Americans do not know that our monetary system is debt-based. The only money our government creates is coins. All other money is created through government, consumer and business borrowing. When the Federal Reserve drops interest rates, all borrowing tends to increase and the money supply grows. Historically, this tends to generate an economic boon. However, an expanded money supply also causes inflation and a devaluation of the dollar. When inflation gets out of hand, the Federal Reserve increases interest rates to curtail inflation. This is precisely the situation now and is largely due to the stimulus spending, which had to be borrowed into existence by the Government, as well as spending on the Ukraine crisis. The problem is that when borrowing decreases and loans are paid off without new loans to replace them the result is a lessening of the money supply. Thus, spending declines and we move into a recession. Another dilemma is that the government’s short-term-debt obligations are so out of control that the Fed significantly raising interest rates could throw the Federal Government into default. So, how much danger is our economy in?
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