My Say: Could a US recession derail Asia’s recovery?
There is growing chatter about a US recession. Talking heads have popped up all over the media asserting confidently that the American economy is doomed to contract because its central bank is tightening monetary policy aggressively at a time when the surge in inflation, escalating energy costs and the horrors of the Ukraine war are undermining confidence.
Note that a recession is not just a couple of quarters of falls in gross domestic product as some commentators say, but something deeper — a downturn in incomes, employment, industrial production and services output that is prolonged and spread widely across much of the economy. Our view is that, first, a downturn of such a nature is not preordained for the US. The headwinds that the pessimists point to are real and will certainly slow the economy — but there is no persuasive evidence yet that this slowdown will turn into an outright recession.
Second, we also believe that,…