The economic forecast for 2023 continues to darken. It is now clear that the fear of a recession is real, and under it corporate America is preparing for a slowdown in consumer spending. CEOs of the leading companies in America addressed inflation, interest rates, employees and customers, and gave one his forecast for the next year.

The CEOs of the major investment houses present a pessimistic picture for the future. “Rising interest rates, record inflation, geopolitical pressure and other factors may coalesce into a recession,” said a CEO JPMorgan Chase Jamie Dimon, for CNBC. Dimon also explained that savings and government aid during the pandemic did help to keep consumers’ wallets stable, but inflation and interest rate increases “erode everything”, as he put it.

Dimon predicts that the increased consumer spending of 2022 will not last much longer, emphasizing the risk posed by rising interest rates as the Fed works to curb inflation. The CEO also referred to the geopolitical upheavals of the past year, primarily the war in Ukraine and the tense trade with China, as part of the “storm clouds” that Dimon sees approaching. When the dollar strengthens, he noted, international trade in goods, such as oil, for example, will continue to become more expensive because currencies are weak We have to adjust the difference. “Looking ahead, these things could disrupt the economy and cause a mild to severe recession, which we are worried about. It could be a hurricane. We just don’t know,” he concluded.

Also CEO Goldman Sachs, David Solomon, marks the possibility of a recession next year as more than likely. Solomon expects the stock market slump to continue in 2023 and thinks the odds of a recession hitting the US economy are about 2 in 3.

Speaking at the Wall Street Journal’s CEO Conference meeting yesterday (Tuesday), Solomon said that he expects stock markets to fall further, along with oil and real estate (both commercial and residential), while the US dollar is expected to rise slightly next year. . Meanwhile, the CEO of Goldman Sachs put the probability of a “soft landing” – or a slowdown in inflation that does not tip the economy into recession – at only 35%.

“I would define a soft landing when inflation returns to a rate close to 4%, perhaps at a final rate of 5% and growth of 1%,” Solomon said. “I think there is a reasonable possibility that we can navigate such a scenario. But I also think there is a very reasonable possibility that we could have some kind of recession,” adding that “it is not certain, and anyone who tells you that they know, does not know.”

The major US retailers are concerned about the rate of inflation

CEO General Motors , Mary Barra, foresees economic challenges next year, but remains moderate in her predictions. “I’m not going to declare a recession, I’ll leave that to the economists,” Barra told CNBCadding that the auto giant still sees strong consumer behavior.

Even so, General Motors is moving cautiously to be prepared for a potential collapse in demand, similar to what has occurred in other industries. During the pandemic, when consumers spent less on travel and services, some industries saw increased demand and were caught off guard when that demand later disappeared.

The effects of the corona on General Motors are still evident in high demand, but Barra expects the automaker to maintain a “fairly conservative” approach to 2023.

In the retail industry, on the other hand, the changes in consumer behavior are more noticeable. The previous month, the two retail giants in America published Walmart and,Target , their quarterly reports, which revealed a large gap between the different income levels. Doug McMillon, CEO of Walmart, explained to CNBC the impact of the changes on the group’s future moves. “We have some more budget-conscious customers who have been under inflationary pressure for months,” adding that inflationary pressure also affects employees.

While the retail giant’s pandemic-era staffing difficulties have begun to fade after it raised wages, McMillon noted that there is still a shortage of staff in more junior positions. Regarding the fear of a recession, McMillon promised that if a severe recession hits, Walmart will not resort to workforce reduction. “Should the Fed do what it needs to do, even if it’s a much harder landing than we would like? I think inflation needs to be addressed,” even at the cost of a recession, McMillon said.

CEO of the railroad giant, Union Pacific , less forgiving of the Fed. “The Fed is trying to hurt the spending ability of all of us with a slower economy and damage to demand. This is not good,” Lance Fritz told CNBC. With consumer spending shrinking and the economy tightening, the transportation industry is also experiencing a slowdown. “The housing market has clearly slowed down and package packaging has clearly slowed down and we’re seeing that in paper and package deliveries,” Fritz added. Fritz left the decision of whether to put pressure on the consumer’s wallet, a tool to curb inflation, at the cost of a recession in 2023, up to the Fed. “As interest rates continue to rise, spending and consumer demand will surely decrease,” concluded Fritz.

Also CEO United Airlines Holdings , Scott Kirby, points the finger of blame at the decision makers. Kirby told CNBC that the company is entering next year with optimism, but the economy could experience a “mild Fed-induced recession,” in his words. Business travel is enjoying a steady recovery after collapsing during the pandemic, but Kirby said demand for leisure travel is picking up instead, which he believes may indicate “pre-recession behavior.” And while the industry is in the “eighth round” of recovery since the coronavirus, Kirby said it is still struggling with issues left over from the pandemic, such as pilot shortages and expensive fuel. For now, United Airlines has enjoyed the benefits of hybrid work because the increase in telecommuting allows people more flexibility for travel, Kirby said. United still maintains a positive outlook as its revenue continues to rise. Kirby said the company is “returning to profit margins that nearly break all-time records.”

“If I wasn’t watching the news in the morning, the word recession wouldn’t be in my vocabulary,” Kirby said. “You just can’t see it in our data.”

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