The pandemic upended many of the things we thought we knew about the economy. Even now, economists struggle to answer such fundamental questions as whether Americans are better off financially.
Alarm bells sounded Friday when we learned that the US unemployment rate rose to 3.9% for October, well above the 50-year low of 3.4% that it hit earlier in the year. The latest reading is still very low, so what’s with the doomsayers telling us a recession has arrived?
Amid the debate over student loans — President Joe Biden’s administration tried and failed to forgive some of the debt, which starts accruing interest this month after a three-year pause — a crucial question has often been overlooked: Who benefits the most from student loans? It’s not necessarily the students.
Americans are downbeat about the economy, even as inflation rates rapidly decline back toward more normal levels, the unemployment rate has held below 4% for the longest stretch since the late 1960s and economists race to raise their growth forecasts.
Even with elevated consumer prices and high borrowing costs, Americans continue to spend at a solid clip, complicating the Federal Reserve’s efforts to tame inflation.
Last week the Supreme Court struck down the Biden administration’s student loan forgiveness plan, which would have done away with as much as $20,000 per borrower.
Federal Reserve Chair Jerome Powell is testifying before Congress this week on the state of the US economy and monetary policy, and there will be some tension.