Why the economy is not dying
Even with rising FED rates the economy is still strong why?
1. People have jobs and want to work
Specifically in the hospitality sector
2. People locked in low mortgage rates
During the pandemic a lot of people locked in low mortgage rates.
Also more people are renting than ever before.
3. Better supply chains
Businesses were having a tough time during with their supply chain during lock down. Now they are running more smoothly.
4. High business profits
Businesses continue to pass on costs to consumers. They are also becoming more efficient and focusing on bottom line profits over expanding revenue.
5. Better technology
Technology is creating a lot of jobs and making existing businesses more efficient.
6. More government spending
Infrastructure. And just general government spending is still increasing.
The IRS will be going on a hiring spree. The military has a bigger budget than ever.
7. Divided government
Republicans have control of the house. Dems the Senate and President.
This means stability and not much change historically. Generally the economy does better with a dividend gov.
8. Return of physical retail
Malls are full again. Movie theaters and restaurants are back. Hotels and travel. These industries require a massive workforce.