Source: Fortune
Summary
Claudia Sahm, an economist and creator of the Sahm Rule, a recession indicator, is concerned about the US labor market and institutions. Despite data showing a stable economy, Sahm believes the labor market is experiencing structural shifts, with low hiring rates and a “low-hire, low-fire” environment. She also worries about the politicization of institutions, such as the Federal Reserve, which could impact the economy. Sahm’s concern is not about an immediate recession but rather about the long-term implications of these shifts.
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The numbers tell one story.
Claudia Sahm’s Sahm Rule has been accurate in predicting recessions, but she believes the current labor market is behaving strangely. Hiring rates are low, and the usual responses from policymakers may not be effective. The labor market is experiencing structural shifts, and Sahm is concerned about the implications for workers. The Fed’s independence is also under pressure, which could impact the economy. Sahm’s concern is not about an immediate recession but rather about the long-term implications of these shifts.
It’s like watching a slow-motion train wreck, where the usual warning signs don’t apply.
Author: Evan Null
