The good news is that the bad news might be just bad enough

When Rube Goldberg meets Ocean's 11 and it's so crazy it just might work

Consumers are down but not out. Companies are slowing their hiring. Prices are falling. Fragility is creeping into the system. Everything is going exactly according to the plan. Finally, a prediction about 2023.

Things we think

Consumers are down but not out

As expected, consumers kinda-sorta showed out for the holiday season. They certainly spent money, including $9.12B online, a 2.3% YoY increase¹—indeed, Amazon claims to have broken records, but is keeping the details to itself. On the other hand, prices are ~7% higher than last year, so a 2.3% increase is still less buying overall. Plus, consumers were fairly judicious in their approach, training most of their fire on discounted items, like electronics and toys.

The implication is that “pandemania shop-til-you-drop” demand-driven inflation is basically donesies. That’s good and the Fed will like that.

That being said, it’s not like we’re in a full-on “demand-destroyed, no-fun-times” deflationary period either—people are still generall…