Are we entering a recession? World Bank chief can't see how we avoid it

[mahatmakanejeeves]

Hat tip, the BBC World News on TV this morning

FINANCE • ECONOMY

Are we entering a recession? World Bank chief can’t see how we avoid it

BY CHLOE TAYLOR
May 26, 2022 5:03 AM EDT

The head of the World Bank sounded the alarm over an impending global recession on Wednesday, warning it was difficult to envision a future where a worldwide downturn could be avoided.

Speaking at an event hosted by the U.S. Chamber of Commerce (USCC), World Bank president David Malpass said the war in Ukraine—and its impact on food and energy costs—could spark a global recession.

“As we look at global GDP…it’s hard right now to see how we avoid a recession,” he said. “The idea of energy prices doubling is enough to trigger a recession by itself.”

Malpass did not elaborate to give a specific forecast on how deep a recession might be.

{snip}

[True Dough]

1. I think it would take a 1 in a 1,000 chance

to avoid a recession. War ends in Ukraine and grain exports resume and fuel prices come down substantially. China ends Covid lockdowns and its economy resumes growth. The Fed tames inflation with well-timed and appropriate interest rate increases. No other world crises that create a significant drag on major economies.

Definitely a long shot, IMO.

[bucolic_frolic]

2. Powell's dallying left the Fed with nowhere to go

The Fed is 10 months late on these rate hikes. The recession would be half over with half the inflation if they'd acted sooner. No way all Fed members didn't know the effect on inflation of 12 years of loose monetary policy and asset bubbles. They thought crypto and tax cuts for the rich would hide the cash forever. Nice job, guys. Nice job screwing the currency.