Consumer spending is 69% of the US economy, up from under 60% decades ago.
Meanwhile, consumer sentiment is very low. It collapsed during the initial pandemic, then bounced, and rolled over to new lows.
The PMI is rolling over, and junk bond yields are starting to go up.
Unlike the prior tightening cycle, the Fed will be attempting this tightening cycle with economic deceleration and low consumer sentiment from the start.
People don't want inflation. Well, one way to reduce inflation is to kill demand. People don't want that either.
¯\_(ツ)_/¯
The US runs a structural trade deficit, so unlike for example China, we can't really boost GDP by focusing on exports. If US consumption stagnates, US GDP likely stagnates too.
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