RETAIL COLLAPSE: A BEZOS RECESSION?

As the article notes, there is a possibility that a retail collapse could spill over into the commercial real estate market—a somber second-act to the residential housing crisis that is now almost a decade in the rear-view mirror.

The Wall Street Journal‘s Greg Ip wrote earlier this month: “If you drew up a list of preconditions for recession, it would include the following: a labor market at full strength, frothy asset prices, tightening central banks, and a pervasive sense of calm. In other words, it would look a lot like the present.”

So even as the bull market keeps running and solid jobs numbers keep coming in, it’s important to remember the economy’s potential vulnerabilities in this time of technological change. And if a recession does strike, our political vulnerabilities will be exposed as well.

On the upside, the “recovery” was so anemic it barely counted as one, and there’s a lot of pro-growth low-hanging fruit in terms of deregulation and tax cuts — but to the extent the dysfunctional Congress has to act, that low-hanging fruit may still be out of reach.