text: Chief Operating Officer (COO) and President of Goldman Sachs, John Waldron, says that “this is among, if not the most complex, dynamic environment I’ve ever seen in my career. We’ve obviously been through lots of cycles, but the confluence of the number of shocks to the system, to me, is unprecedented.” Citing risks to the cycle of operating capital markets, Waldron says that Goldman Sachs will work to diversify and expand its asset and wealth management divisions through M&A from emerging opportunities. Waldron’s statement follows JPMorgan CEO Jamie Dimon’s statement that the economy is in a “hurricane,” just up the road, is “coming our way,” and that we aren’t sure if it’s going to be a minor hurricane or “Superstorm Sandy.” (AC: There’s been a sharp shift in rhetoric from top banking officials that only a few short weeks ago provided opinions that we could navigate out of our economic hardship without a recession. Between stagflation’s emergence, recessionary warnings, inflationary pressures, uncertain action on monetary policy, and the war in Ukraine, opinions have swayed toward what could be described as inevitable for some type of negative economic event. – T.W.)Domestic expectations and global economic health predictions fallIn a hearing with the Senate Finance Committee earlier this week, Treasury Secretary Janet Yellen warned that we would likely remain in a prolonged period of heightened inflation. The White House is expected to amend its inflation forecast yet again to a number higher than original expectations of 4.7% for 2022.Following forecasts from the World Bank in January of this year that global growth would increase by 4.1%, the World Bank has revised its latest growth projections to 2.9%. The bank also forecasts that US growth (real GDP) will decrease to 2.5% this year, down from previous projections of 3.7%. Suppressed growth rates, according to the World Bank, are expected to remain at approximately 2.2% for 2023 and 2024. Stagflation concerns persist, with World Bank officials stating that although a recession may be avoided, stagflation could linger for several years afterward. World Bank President David Malpass says, “The danger of stagflation is considerable today. Subdued growth will likely persist throughout the decade because of weak investment in most of the world. With inflation now running at multi-decade highs in many countries and supply expected to grow slowly, there is a risk that inflation will remain higher for longer.”Despite lackluster projections from the World Bank and negative sentiment towards markets in the US, supply chain pressures, and order backlogs, Yellen maintains that the economy is beginning a transition from recovery to “stable and steady” growth. Saying in her recent appearance in front of the Senate Finance Committee that the US is not the only country experiencing higher inflation, it seems that she is beginning to try and divert blame to factors out of the government’s control, continuing by noting that the “American Rescue Plan can’t be” the reason we are experiencing this high of inflation. Yellen says supply failure is the majority problem resulting in this prolonged period of elevated inflation and that we should, from this period of elevated inflation, assume the interest on our debt is “completely manageable” over the next decade. – T.W.Mester on the Economy