This is CBS. I am the world. I'm John Batcha. The American economy. The puzzle, the Federal

Reserve consistently has predicted, has said, has promised there will be a recession.

Sometime over these last days, the Federal Reserve qualified it, saying there will be a

mild recession. It is not here by any normal measure. I keep looking for it. I welcome my colleague

and friend Jim McTay, former Washington Editor of Barron's magazine. He is in the Bountiful

Lancaster County, which is a very prosperous place, not only for Pennsylvania, but for the whole

country. And Jim looks for the recession as well and can't find it. So now we turn to why not?

The numbers of the week that Excite Wall Street have to do with the inflation numbers.

There was the Consumer Price Index and the Producer Price Index, CPI and PPI. Both are declining

dramatically. And more to the point, they're in the right direction, responding to 10 hikes by

the Federal Reserve in the last year. Jim, a very good evening to you. You've been through this

rodeo many times. The decline of the CPI inflation number, the decline of the PPI inflation number.

Can that be a false signal? Are we encouraged? Good evening to you, Jim.

Oh, good evening, John. We are encouraged because this economy is so unique, so strong,

it's so vibrant. And a lot of it is like Post-World War II. We have post-COVID. And the public

as I like to say, we're still celebrating our liberation from lockdown. So that's a reason

that despite all these interest rate hikes, the public's animal spirits are still strong.

And I agree that we're not going to have a serious recession. I don't see a soft landing,

however, because, you know, as you said, I've been through these inflation fights before.

They are not easily won. And we have fed governor saying we need at least two more rate hikes this

year. I think the hawks, I think they're correct because there are storm clouds ahead

in the economy that could cause serious disruptions and feed, you know, have a trigger of

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