Snap Goes the Economy

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First-quarter 2022 GDP fell by 1.4%. Many economists and Fed members foresaw the economy slowing from its robust 6.9% pace in the fourth quarter of 2021, but few predicted an economic contraction. Despite the poor start to the year, many economists are optimistic about second-quarter growth.

The graph below shows the consensus estimate for second-quarter GDP growth is 3%, and the Atlanta Fed GDPNow model expects 2.4% growth.

Following the first-quarter GDP, economist Ian Shepherdson, a frequent guest on CNBC, wrote, "The economy is not falling into a recession."

I beg to differ with Ian and the "consensus."

Recent warnings from corporate executives and rapidly declining regional manufacturing surveys make me wonder if a recession has already started.