Back To The Old Normal?

Check out the accompanying pdf and chart collection. Executive Summary: The unconventional ultra-easy monetary policy that reigned from the Great Financial Crisis to the Great Virus Crisis—a.k.a. the “New Normal”—aimed to stimulate the economy and shore up inflation. Now the “Old Normal” is back, characterized by more conventional tight monetary policy aimed at taming inflation, even if that kickstarts a recession. … But this post-pandemic business cycle isn’t following the usual Old Normal script—instead featuring an oddly quick snapback of GDP growth and oddly vigorous comeback of inflation. … Today, we look at what’s been happening in various segments of the economy this year and forecast what’s in store for 2023.