Economic activity is still strong even as investors fear the worse.

While financial markets have been highly volatile, economic fundamentals have remained consistently solid. They are expected to remain solid with the data due out this week. The issue is not current conditions, but the risk economic conditions will deteriorate in the next six months. The fear is consumers will cut spending to pay for basic needs that cost much more and use more of their disposable income. To date, that has not been the case. It is estimated that consumers have more than $2 trillion in liquidity left from the huge increase in savings in the past two years.

 

PROBANK AUSTIN ADVISOR - MAY 23, 2022