Here is what the IMF has to say, when we are in this weird time when pretty much anybody who wants a job can get one (in the U.S.), growth as measured by GDP is low or negative in the US and elsewhere, reported inflation is high but the shock has sort of worn off, and I can predict with total confidence that we may or may not be teetering on the edge of a recession, which if it happens might be either mild or severe and either short or long.

• “Global growth is forecast to slow from 6.0 percent in 2021 to 3.2 percent in 2022 and 2.7 percent in 2023.”
• “Global inflation is forecast to rise from 4.7 percent in 2021 to 8.8 percent in 2022 but to decline to 6.5 percent in 2023 and to 4.1 percent by 2024.”
• If this forecast is wrong, it will probably be wrong on the “downside”. The long list of risks includes monetary policy not working, US dollar appreciation disrupting trade, energy and food price shocks, emerging market debt distress, natural gas supply shocks in Europe caused by the Russia-Ukraine war, a continuation of the last pandemic and/or a new pandemic, a bursting of the real estate bubble leading to a financial crisis in China, and “geopolitical fragmentation could impede trade and capital flows, further hindering climate policy cooperation”.
• “successful multilateral cooperation will prevent fragmentation that could reverse the gains in economic well-being from 30 years of economic integration.”

I emphasized the word “will” above. Is that “will” like we think successful cooperation will happen, or “will” like if successful cooperation could somehow happen, then this positive outcome will happen. It’s hard to be optimistic these days. About the most optimistic thing I can say is that when almost everybody in the world is feeling pessimistic, maybe we have hit bottom and can start clawing our way back up.