Your Weekend Reading: Recession or No Recession Is the Question

So is it a recession or not? The US economy shrank for a second straight quarter, which to some technically means a downturn. But the obscure panel of economists actually in charge of declaring whether there is one or not says the nation isn’t there yet. Still, there’s a beleaguered stock market and larger-than-forecast rises in two key inflation gauges, which may lead the Fed to keep hiking rates aggressively. But there’s also record employment, a fist-tight labor market and consumer spending that’s still rising, albeit barely. In retail, Walmart, like competitor Target, is marking down a glut of inventory accumulated amid the supply chain chaos. And while customers are spending, they’re buying more food and necessities and less flatscreens and microwaves. “If Walmart, with its low-price prowess and cost-cutting expertise, is suffering, the damage from more skittish shoppers will be even worse elsewhere,” Andrea Felsted writes in Bloomberg Opinion.

US President Joe Biden and Chinese leader Xi Jinping ended a phone call with plans to hold their first face-to-face summit, but the US and China are unlikely to stop bickering. An immediate issue is a possible trip to Taiwan by House Speaker Nancy Pelosi. Both leaders are facing political trouble at home, in Xi’s case a revolt over a mortgage crisis that has also halved the fortune of Asia’s richest woman. Biden has been taking fire for inflation, but is slated to notch a victory, signing into law a $52 billion package to boost domestic chipmakers in the face of Chinese advances.

Big Tech is navigating the tough economic environment better than smaller rivals, earnings show. Amazon, Alphabet and Apple all met or exceeded analyst expectations, soothing investor fears even as consumers curb spending. There were notable exceptions, including Intel and Meta, which reported its first-ever quarterly sales decline. Meta was also sued by the Federal Trade Commission as the agency strikes a more aggressive antitrust approach.