Skip to Content

Stock concerns

IDAHO FALLS, Idaho (KIFI) - Wall Street holds its breath as the market dips yet again.

The DOW dropped another 237 points Thursday and the Nasdaq lost 30, while The S&P 500 fell 23 points.

Many financial analysts have been sounding the warning cry of a recession.

"With the Fed raising interest rates a half a point a couple of weeks ago, and they're poised to raise rates at half a point in June and July," Wells Fargo Economics Director Mark Vitner said. "The bulk of the impact of those higher rates is really going to hit the economy next summer, a year from now. And I think the second half of next year is where we may be at most risk for a recession."

Financial experts say the slowdown is a reaction to uncertainty overseas, supply chain issues, and especailly inflation.

Economists at Wells Fargo say the inflation is part of paying the bill for pandemic finacial support.

“What is really caused the higher inflation was that $5 trillion in stimulus. That was what was provided to the economy during the pandemic, all of which was financed by the Federal Reserve, which bought up all that debt and created $5 trillion in new money. And it's now all that excess liquidity that's causing inflation to go off," Vitner said.

We can see the inflation reflected in gas prices, housing and produce.

Now the FED is gradually raising interest rates to try to stabilize and possibly bring it back down.

“We haven't had meaningful inflation in over forty years," said Journey Financial Services President Jennifer Landon. "So the Fed's trying to step in and trying to regulate it to some large degree so that it doesn't get out of control.”

But local economists assure us things may not be as bad as they seem.

“Honestly, this isn't out of the realm of normal. About every two and a half years, we'll have about a 20% correction in the S&P. 500. So we just haven't seen one in a while,” Landon said.

Article Topic Follows: Economy

Jump to comments ↓

Author Profile Photo

Seth Ratliff

Seth is a reporter for Local News 8.


KIFI Local News 8 is committed to providing a forum for civil and constructive conversation.

Please keep your comments respectful and relevant. You can review our Community Guidelines by clicking here

If you would like to share a story idea, please submit it here.

Skip to content