International Business Times Article on Why No Recession Yet

I am quoted in the International Business Times:

“The primary reasons high-interest rates have not yet pushed the economy into a recession are the historically low unemployment rate of 3.9%, David I Kass, Clinical Professor of Finance at the University of Maryland, Robert H. Smith School of Business, told the International Business Times.

Professor Kass sees another set of macroeconomic factors that have helped American households keep on spending money, like a shallow average home mortgage rate of 3.8%; consumer balance sheets with large cash balances from the recent monetary and fiscal stimulus in response to the pandemic; relatively little consumer debt as compared to the Great Recession (2007-09); and the Consumer Price Index (CPI) and the Core Personal Consumption Expenditures Index (less food and energy) currently at 3.7% down substantially from 9.1% in June 2022 (CPI).

He’s also pointing out that previous recessions resulted from the Federal Funds rate being increased to much higher levels than the current 5 1/4% – 5 1/2%.