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A recession might have been simpler than what awaits the U.S. economy

Good morning.

With just a week left of summer, I want to use the next five days to explore five big questions every CEO must wrestle with in the coming months:

1. The economy: Is this a soft landing or the calm before the storm?

2. Technology: A.I. will transform my business. But how? And how quickly?

3. Climate The energy transition is happening: How should my company play it?

4. Geopolitics: The world is realigning: How should we realign with it?

5. U.S. politics: As much as I’d like to avoid it, I can’t. What’s the best strategy to survive?

Today, question one. And let me start with a confession: Inflation has eased off far faster than I expected. There’s no sign we are in for a replay of the 1970s. The statements from the Fed’s Jackson Hole meeting last week, though characterized as hawkish, suggest the monetary policy masters feel confident they have finally gotten ahead of the game…or at least are no longer behind it. And they have gotten there without, so far, causing a recession. The most widely predicted downturn of modern times is nowhere in sight.

But that doesn’t mean the economy is out of the woods. With interest rates likely to remain high for some time, bankruptcies are rising. And the shakeout in office real estate—pounded by a double whammy of high rates and low occupancy—is still to come. A second round of bank problems could follow.

In some ways, a recession might have been simpler. The unintended consequences of more than a decade of easy money are still lurking in the wings. The soft landing doesn’t mean the economy is ready for take-off. It just means the final verdict on this era of unprecedented experimentation in economic policy has yet to be delivered.

By the way, don’t assume the China slowdown won’t blow back on the U.S. economy. Fortune's Will Daniel looks at the implications here.

Tomorrow, I’ll take on the technology question. Let me know if you think my five are missing something big. More news below.

Alan Murray

This story was originally featured on

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