Page 19 - The SouthChina Business Journal
P. 19
ks to the Positive Geopolitics could also hurt the economy.
Intensification of the Russia-Ukraine and Israel-
Forecast Hamas wars could destabilize the global economy,
which would hurt the U.S. economy. And there is
As is always the case, there are risks that could always the chance of an unforeseen conflict arising.
threaten the optimistic outlook. There are always
unknown-unknowns, black swan events no one Lastly, there remains domestic U.S. political risk.
can predict that could imperil the economy – a Congress still needs to pass a budget for fiscal
pandemic, for instance. years 2024 and 2025. It also needs to raise the
debt limit before January 1, 2025. Failure to do any
There are more tangible threats for the economy of these would mean a blow to the economy.
in 2024 though. The riskiest is a severe drop
in the office space market. The prices of office Bottom Line
space buildings in urban centers have plummeted
because of higher vacancy rates and higher The economy faces serious challenges in 2024,
interest rates. This is putting their owners and the as it always does. The worker shortage means
owners’ lenders in a tight spot and could lead to a consumers are better equipped to weather a
credit crunch at regional size banks. These banks potentially slowing economy to start the year. It
are crucial suppliers of credit to small and medium- also means that any slowdown is likely to be mild
sized businesses, and they are the largest lenders and that the economy is likely to rebound strongly.
to the owners of office space complexes. These
banks need to cut back on lending as they sort
through their losses on office space loans.
SOUTH CHINA BUSINESS JOURNAL 16
Intensification of the Russia-Ukraine and Israel-
Forecast Hamas wars could destabilize the global economy,
which would hurt the U.S. economy. And there is
As is always the case, there are risks that could always the chance of an unforeseen conflict arising.
threaten the optimistic outlook. There are always
unknown-unknowns, black swan events no one Lastly, there remains domestic U.S. political risk.
can predict that could imperil the economy – a Congress still needs to pass a budget for fiscal
pandemic, for instance. years 2024 and 2025. It also needs to raise the
debt limit before January 1, 2025. Failure to do any
There are more tangible threats for the economy of these would mean a blow to the economy.
in 2024 though. The riskiest is a severe drop
in the office space market. The prices of office Bottom Line
space buildings in urban centers have plummeted
because of higher vacancy rates and higher The economy faces serious challenges in 2024,
interest rates. This is putting their owners and the as it always does. The worker shortage means
owners’ lenders in a tight spot and could lead to a consumers are better equipped to weather a
credit crunch at regional size banks. These banks potentially slowing economy to start the year. It
are crucial suppliers of credit to small and medium- also means that any slowdown is likely to be mild
sized businesses, and they are the largest lenders and that the economy is likely to rebound strongly.
to the owners of office space complexes. These
banks need to cut back on lending as they sort
through their losses on office space loans.
SOUTH CHINA BUSINESS JOURNAL 16
