13 hours ago
- The U.S. economy in 2026 faces key issues including Federal Reserve interest rate decisions, stagflation risks from tariffs and labor market weakness, and political pressures on Fed independence.
- Tariffs are a major concern, raising consumer prices and production costs, with potential for Supreme Court intervention but administration likely to continue tariff policies.
- AI has limited labor market impact so far, with small disruptions in specific occupations, while AI bubble debates persist over stock valuations and adoption speed.
- The labor market is in a low-hire, low-fire state with 'meaningful' downside risks from rising unemployment and potential AI headwinds.
- Other issues include health care costs from reduced ACA subsidies, dangerous fiscal deficits, affordability concerns for consumers, and rising electricity prices due to grid investment and demand.