However, as Statista’s Felix Richter reports, that has come at the expense of personal saving, which dropped sharply in 2022, when the personal saving rate, i.e. the share of their disposable income that people weren’t spending on consumption, taxes or interest payments, dropped to the lowest level since the financial crisis.

You will find more infographics at Statista

During the pandemic, when generous stimulus checks met limited consumption possibilities, Americans had saved more money than ever before, with the personal saving rate peaking at 32 percent in April 2020 and remaining above the pre-pandemic trend until the end of 2021.

That’s when inflation started to bite, and people started utilizing these excess savings to support their spending.

According to calculations made by economists at the San Francisco Fed, American households accumulated $2.1 trillion in excess savings between March 2020 and August 2021, that is they saved $2.1 trillion more than they would have been expected to based on the pre-pandemic trend of personal saving. In September 2021, people began saving less than they would have been expected to, meaning those excess savings were gradually drawn down. Three inflation-plagued years later, Americans have burned through those excess savings, and then some.

At the end of September 2024, Americans had collectively saved $291 billion less since March 2020 than they would have been projected to if the pandemic had never happened.

Now, the inflation crisis under the Biden-Harris administration has intensified this issue even more. It was especially families with children that suffered during Covid-19 as school lunches disappeared and they have been hardest hit again in 2022 and 2023.

As Statista’s Katharina Buchholz reports, the USDA just published its latest report on the issue, showing that last year, almost 18 percent of households where children lived were food insecure, up from 17.3 percent in 2022 and 12.5 percent in 2021. The negative effects of the coronavirus pandemic as well as the inflation crisis on food security still stayed behind those of the Great Depression between 2008 and 2011, however.

You will find more infographics at Statista

Looking at all household, 13.5 percent were classified as food insecure by the USDA most recently, defined as experiencing difficulty to meet basic food needs in the span of one year, including the inability to buy enough food, buy balanced meals or eat regular portion sizes as well as skipping meals, experiencing hunger and worry about food. In 2021, this share had been 10.2 percent.

While the share of food-insecure households rose in the U.S. in 2023, so did the share of adults living in them – from 13.5 percent to 14.3 percent. The share of U.S. children living in a food-insecure household rose as well from 18.5 percent to 19.2 percent. However, according to the USDA, it was often the adults in food-insecure households who restricted food intake, while attempting to shield children – especially younger ones – from negative effects.

Household with children number around 36 million in the U.S., around 27 percent of all households, while children themselves make up around 22 percent of U.S. residents at 72 million.

In this now fifth year of our Prediction Consensus (part of our comprehensive 2024 Global Forecast Series), we’ve summarized 25 of the most common predictions and forecasts by experts into a single visual of what’s expected to happen in 2024.

Drawing from our predictions database of over 700 forecasts compiled from reports, interviews, podcasts, and more, Visual Capitalist’s Niccolo Conte created the Prediction Consensus “bingo card” and this article to offer an overview of the most cited trends and opportunities that experts are watching for the rest of the year.

This visual is from our 2024 Global Forecast Series Report:

Get full access to the series, which compiles insights from 700+ expert predictions for what will happen in 2024, by becoming a VC+ member today.

The Economy and Markets in 2024

Based on the hundreds of economic forecasts and predictions we’ve sifted through, many analysts and experts share similar views on what’s ahead for inflation, interest rates, and economic growth in 2024.

Inflation: After inflation’s steady decline across economies in 2023, many analysts see inflation continuing to cool off towards target levels. While some note that the last stretch to these targets could be the toughest, few foresee the possibility of inflation surging again like we saw in 2022.

Interest Rates: With inflation largely expected to be tamed in 2024, every major bank and institution forecasts interest rate cuts by the Federal Reserve, European Central Bank, and Bank of England by the middle of the year. Forecasts from analysts on how much rates will be cut vary between three and six cuts, with Federal Reserve board members themselves forecasting two to three cuts.

Markets: With interest rate cuts on the horizon, experts have echoed tentatively positive forecasts for both stocks and bonds in 2024. Falling rates should see bond yields fall as well, while equities should continue to benefit from the growing AI theme. Portfolio diversification is a common theme in the 2024 investment playbook, especially as geopolitical risks loom.

Real GDP Growth: The outlook for growth around the world is muted. Global GDP growth forecasts range from 2.5-3%, which is slightly lower than the 10-year average (2013-2022) of 3.1%. The U.S. is also forecasted to see slowing growth, with the IMF’s forecasts of 2.4% in 2023 moving down to 1.5% in 2024, while Europe is also expected to continue seeing slow growth at 0.9% in 2024.

When looking at other nations, many experts are predicting we’ll see India outpace China when it comes to real GDP growth this year, especially if the trend of manufacturing and foreign investment shifting away from China continues.

“The transition is two-sided: India is investing in infrastructure and courting foreign investment, while China is investing in aircraft carriers and turning its gaze inward to deal with youth unemployment and sectors crashing.”

– Scott Galloway

Geopolitical Predictions for 2024

After the past couple of years brought geopolitics back to the forefront with Russia’s invasion of Ukraine and Israel’s war with Hamas, experts don’t see global tensions cooling off anytime soon. In fact, many cite further geopolitical sparks and potential escalation as their top risk to watch out for in 2024, requiring diversified and nimble positioning.

With ongoing strikes from Yemen’s Houthi militants on container ships in the Red Sea resulting in marine shipping disruptions, retaliatory U.S. strikes are now likely cementing the potential for ongoing disruption for marine shipping around the world.

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Outlooks for the Russia-Ukraine and Israel-Hamas wars are equally indecisive, with few to no experts foreseeing true resolutions for either conflict in 2024, and most citing further escalation and additional country involvement as the more likely scenarios.

Along with these ongoing geopolitical issues, 2024 is a key year for elections around the world. With the U.S., Russia, Ukraine, India, Mexico, and many other countries holding elections this year, there’s little stable ground in geopolitics without the potential for seismic shifts this year.

Further Boom or Regulatory Bust for AI in 2024?

After its breakout year in 2023, artificial intelligence faces new challenges in 2024 which is set to be another pivotal year for the technology.

While advances in the technology are inevitable, the less exciting reality of regulation and legal disputes around training data is already a key issue, as seen in the New York Times’ lawsuit against OpenAI. Along with this, the growing potential for malicious AI use around the many global elections this year could spur further calls for greater regulation.

Experts see these topics acting as a bit of a damper on another potentially explosive year for AI product growth and distribution. Many are expecting the EU to clamp down faster and harder than the U.S. when it comes to regulation.

2024 Forecasts: Everything is Connected

While the global economy, markets, geopolitics, and technological advancements have always affected each other in various ways, in 2024 these connections feel stronger than ever.

One such example is how escalating conflicts in the Middle East are affecting shipping insurance costs and routes, which could drive up inflation again and lead central banks to hold off on cutting interest rates this year, thus affecting myriad economic factors and markets around the world.

2024 feels full of both good and bad interconnected possibilities, from forecasts around AI advancements ushering in a new bull market and golden age of productivity to the potential job disruptions it could cause that our labor markets and society might not be ready for.

Despite the world growing more polarized and geopolitically fractured in the past couple of years, these predictions and forecasts remind us of how deeply dependent the health and future of the global economy is on the interconnected nature of these factors.

Only recently has there been a shift in sentiment. Given the resilience of the U.S. economy, a growing amount of investors are seeing an increasing likelihood of a soft landing—where the Federal Reserve raises interest rates to combat inflation without triggering a recession. However, many still remain cautious.

This graphic shows U.S. economic forecasts across Wall Street, Main Street, and C-Suite for 2024.

The Probability of a Recession in 2024

In July, the Federal Reserve staff announced that they were no longer forecasting a recession in 2024, marking a sharp departure from earlier projections.

While the Fed staff continue to share a brighter outlook, the yield curve spread between 10-year and 3-month Treasury rates suggests there is a 61% change of a recession in the 12 months ahead. Historically, the yield curve has been a reliable predictor of recessions, based on a New York Fed model which uses data from 1959-2009.

Meanwhile, a survey of economists by Wolters Kluwer shows that they’re split, with 48% calling for a recession over the next 12 months.

Across Main Street, consumers share a more cautious sentiment, with over 69% saying that a recession is likely in the next year, based on a Conference Board survey.

Yet corners of America’s C-suite have grown more positive. Goldman Sachs recently dropped its recession forecast to a 15% likelihood while Bank of America gives it a 35-40% odds. On the other hand, 84% of CEOs are preparing for a recession in the next 12-18 months, a drop from 92% seen in the second quarter of 2023.

Bull Case vs. Bear Case Signals

Among the key factors investors are closely watching center around the impact of higher interest rates on the economy.

For the bull case, higher rates appear as though they haven’t significantly impacted consumer spending yet, although spending has slowed on non-essential items. Retail sales continue to be solid, and earnings across Home Depot, Walmart, Lowe’s, and other major retailers show resilience. Where the main changes are occurring are with consumers purchasing more affordable options.

However, consumers are relying increasingly on borrowing for spending.

For the bear case scenario, household debt has hit record highs of $17 trillion in March, rising 19% year-over-year. Higher rates have led these borrowing costs to jump, likely affecting household budgets. Meanwhile, corporate defaults have accelerated in 2023, and are projected to keep rising.

Overall, there are mixed signals across the wider economy, and it’s unclear if the country will experience or avoid a recession in 2024. Quantifying the full effects of higher interest rates on consumers and businesses remains an open question.

What do you think? Leave your comments at the Economic Collapse Substack.

Think again. It can and almost certainly will happen here if we do not do whatever it takes to stop it. Generally, I’m not a fan of recommending we need to vote our way out of a situation, but considering the vast array of enemies who are pushing Central Bank Digital Currencies, I’m not sure if there’s a non-political or legal way to stop them. With that said, it would behoove us all to assume the worst and hope for the best when it comes to these abominable control mechanisms taking hold in the United States. Here’s Tyler Durden…

Central bank digital currencies are controlled by governments like traditional currencies are and therefore represent the polar opposite of the idea of decentralized, self-sovereign bitcoins.

As Statista’s Katharina Buchholz reports, several small nations and – since October 2021, Nigeria – have launched central bank digital currencies, and several more populous countries are getting ready to jump aboard a different crypto hype train.

You will find more infographics at Statista

The European Union today is proposing a legal framework for its planned launch of the digital euro. According to the Central Bank Digital Currency Tracker by Atlantic Council, concrete plans to launch a CBDC were also recorded in Canada, Brazil and the United States, among others.

Countries which are already in a CBDC pilot phase include Russia, Thailand, India, South Korea, Sweden, the United Arab Emirates and Saudi Arabia, according to the source. It is unclear, however, which of these programs could see a proper launch next.

CBDCs were introduced even earlier than in Nigeria in Caribbean countries, for example in the Bahamas and nations and territories that share the currency of the Eastern Caribbean dollar. The Sand Dollar of the Bahamas was the first central bank digital currency of the world upon its launch in 2019 and cleared the way for a rapid adoption around the region’s small nations.

The Chinese digital Yuan pilot made headlines in April 2019, but the project has not moved on since. Like Nigeria, China has a solid digital and mobile payment infrastructure. Large parts of the two countries’ populations leapfrogged card payments and went straight from cash to digital payment options, which became hugely popular – may they be app or text-based. In developing countries, central banks also consider the potential of digital currencies reaching the unbanked.

Another reason for some governments to champion official digital currencies is the collection of data.

Ubiquitous digital payments and tight government surveillance have led to a plethora of payment data already available to Chinese administrators. This knowledge on how people spend money will only grow with the implementation of the digital Yuan, even though the country’s central bank has said it will limit traceability and create what it calls “controllable anonymity.”

These aspects of digital currencies are viewed negatively by Europeans, who according to a survey by the European Central Bank are concerned about payment privacy in regards to the digital euro.

Article cross-posted from Zero Hedge.

This infographic from Visual Capitalist offers a concise and accurate view of the trajectory of the dollar from our initial domination to the status we’re in today.

According to Visual Capitalist:

De-Dollarization: Countries Seeking Alternatives to U.S. Dollar

This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on natural resource megatrends in your email every week.

The U.S. dollar has dominated global trade and capital flows over many decades.

However, many nations are looking for alternatives to the greenback to reduce their dependence on the United States.

This graphic catalogs the rise of the U.S. dollar as the dominant international reserve currency, and the recent efforts by various nations to de-dollarize and reduce their dependence on the U.S. financial system.

The Dollar Dominance

The United States became, almost overnight, the leading financial power after World War I. The country entered the war only in 1917 and emerged far stronger than its European counterparts.

As a result, the dollar began to displace the pound sterling as the international reserve currency and the U.S. also became a significant recipient of wartime gold inflows.

The dollar then gained a greater role in 1944, when 44 countries signed the Bretton Woods Agreement, creating a collective international currency exchange regime pegged to the U.S. dollar which was, in turn, pegged to the price of gold.

By the late 1960s, European and Japanese exports became more competitive with U.S. exports. There was a large supply of dollars around the world, making it difficult to back dollars with gold. President Nixon ceased the direct convertibility of U.S. dollars to gold in 1971. This ended both the gold standard and the limit on the amount of currency that could be printed.

Although it has remained the international reserve currency, the U.S. dollar has increasingly lost its purchasing power since then.

Russia and China’s Steps Towards De-Dollarization

Concerned about America’s dominance over the global financial system and the country’s ability to ‘weaponize’ it, other nations have been testing alternatives to reduce the dollar’s hegemony.

As the United States and other Western nations imposed economic sanctions against Russia in response to its invasion of Ukraine, Moscow and the Chinese government have been teaming up to reduce reliance on the dollar and to establish cooperation between their financial systems.

Since the invasion in 2022, the ruble-yuan trade has increased eighty-fold. Russia and Iran are also working together to launch a cryptocurrency backed by gold, according to Russian news agency Vedmosti.

In addition, central banks (especially Russia’s and China’s) have bought gold at the fastest pace since 1967 as countries move to diversify their reserves away from the dollar.

How Other Countries are Reducing Dollar Dependence

De-dollarization it’s a theme in other parts of the world:

• In recent months, Brazil and Argentina have discussed the creation of a common currency for the two largest economies in South America.
• In a conference in Singapore in January, multiple former Southeast Asian officials spoke about de-dollarization efforts underway.
• The UAE and India are in talks to use rupees to trade non-oil commodities in a shift away from the dollar, according to Reuters.
• For the first time in 48 years, Saudi Arabia said that the oil-rich nation is open to trading in currencies besides the U.S. dollar.

Despite these movements, few expect to see the end of the dollar’s global sovereign status anytime soon. Currently, central banks still hold about 60% of their foreign exchange reserves in dollars.