a judge threw it out. The companies were also stymied in Massachusetts. But without the threat of federal enforcement, their state-by-state approach got legislation passed this year in Washington, Georgia and Alabama.

Ms. Moore said she was pessimistic about Mr. Biden’s following through on his promises.

“That was certainly the hope,” she said. “I’m old enough to learn that you can’t pin all your hopes on any one politician.”

Kate Conger contributed reporting.

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This Remote Mine Could Foretell the Future of America’s Electric Car Industry

Hiding a thousand feet below the earth’s surface in this patch of northern Minnesota wetlands are ancient mineral deposits that some view as critical to fueling America’s clean energy future.

poor environmental record in the United States, and an even more checkered footprint globally. While some in the area argue the mine could bring good jobs to a sparsely populated region, others are deeply fearful that it could spoil local lakes and streams that feed into the Mississippi River. There is also concern that it could endanger the livelihoods and culture of Ojibwe tribes whose members live just over a mile from Talon’s land and have gathered wild rice here for generations.

provoked outrage in 2020 by blowing up a 46,000-year-old system of Aboriginal caves in Australia in a search for iron ore.

at higher rates than any other racial or ethnic group in the state. Locals say the only Tesla for miles is Talon’s company car.

“Talon and Rio Tinto will come and go — greatly enriched by their mining operation. But we, and the remnants of the Tamarack mine, will be here forever,” Mr. Applegate said.

near tribal land.

approved a plan to ban the sale of new gas-powered cars by 2035.

Indonesia and the Philippines, releasing vast amounts of carbon dioxide before being refined in Chinese factories powered by coal.

Another source of nickel is a massive mining operation north of the Arctic Circle in Norilsk, Russia, which has produced so much sulfur dioxide that a plume of the toxic gas is big enough to be seen from space. Other minerals used in electric vehicle batteries, such as lithium and cobalt, appear to have been mined or refined with the use of child or forced labor.

With global demand for electric vehicles projected to grow sixfold by 2030, the dirty origins of this otherwise promising green industry have become a looming crisis. The Democrats’ new tax and climate bill devotes nearly $400 billion to clean energy initiatives over the next decade, including electric vehicle tax credits and financing for companies that manufacture clean cars in the United States.

New domestic high-tech mines and factories could make this supply chain more secure, and potentially less damaging to the global environment. But skeptics say those facilities may still pose a risk to the air, soil and water that surrounds them, and spark a fierce debate about which communities might bear those costs.

can leach out sulfuric acid and heavy metals. More than a dozen former copper mines in the United States are now Superfund sites, contaminated locations where taxpayers can end up on the hook for cleanup.

canceled leases for another copper-nickel mine near a Minnesota wilderness area, saying the Trump administration had improperly renewed them.

Talon Metals insists that it will have no such problems. “We can produce the battery materials that are necessary for the energy transition and also protect the environment,” said Todd Malan, the company’s chief external affairs officer and head of climate strategy. “It’s not a choice.”

The company is using high-tech equipment to map underground flows of water in the area and create a 3-D model of the ore, so it can mine “surgically” while leaving other parts of the earth undisturbed, Mr. Malan said. Talon is also promising to use technology that will safely store the mine’s toxic byproducts and do its mining far underground, in deep bedrock where groundwater doesn’t typically penetrate.

Talon has teamed up with the United Steelworkers union on work force development. And Rio Tinto has won a $2.2 million Department of Energy grant to explore capturing carbon near the site, which may allow the mine to market its products as zero emission.

estimates, the world will need roughly 20 times as much nickel and cobalt by 2040 as it had in 2020 and 40 times as much lithium.

Recycling could play a bigger role in supplying these materials by the end of the decade, and some new car batteries do not use any nickel. Yet nickel is still highly sought after for electric trucks and higher-end cars, because it increases a vehicle’s range.

The infrastructure law passed last year devoted $7 billion to developing the domestic supply chain for critical minerals. The climate and tax law also sets ambitious thresholds for ensuring that electric vehicles that receive tax incentives are partly U.S.-made.

has begged miners to produce more.

is home to deposits of nickel, copper and cobalt, which were formed 1.1 billion years ago from a volcano that spewed out miles of liquid magma.

Talon has leased 31,000 acres of land in the area, covering an 11-mile geological feature deep under the swamp. The company has zealously drilled and examined the underground resources along one of those 11 miles, and discovered several other potential satellite deposits.

In August, the company announced that it had also acquired land in Michigan’s Upper Peninsula to explore for more nickel.

Talon will start Minnesota’s environmental review process within a few months, and the company says it anticipates a straightforward review. But legal challenges for proposed mines can regularly stretch to a decade or more, and some living near the project say they will do what they can to fight the mine.

Elizabeth Skinaway and her sister, Jean Skinaway-Lawrence, members of the Sandy Lake Band of Minnesota Chippewa, are especially concerned about damage to the wild rice, which Ms. Skinaway has been gathering in lakes several miles from the proposed mine for 43 years.

Ms. Skinaway acknowledges the need to combat climate change, which also threatens the rice. But she sees little justice in using the same kind of profit-driven, extractive industry that she said had long plundered native lands and damaged the global environment.

“The wild rice, the gift from the creator, that’s going to be gone, from the sulfide that’s going to leach into the river and the lakes,” she said. “It’s just a really scary thought.”

“We were here first,” said her sister. “We should be heard.”

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Expansion of Clean Energy Loans Is ‘Sleeping Giant’ of Climate Bill

Tucked into the Inflation Reduction Act that President Biden signed last week is a major expansion of federal loan programs that could help the fight against climate change by channeling more money to clean energy and converting plants that run on fossil fuels to nuclear or renewable energy.

The law authorizes as much as $350 billion in additional federal loans and loan guarantees for energy and automotive projects and businesses. The money, which will be disbursed by the Energy Department, is in addition to the more well-known provisions of the law that offer incentives for the likes of electric cars, solar panels, batteries and heat pumps.

The aid could breathe life into futuristic technologies that banks might find too risky to lend to or into projects that are just short of the money they need to get going.

failure of Solyndra, a solar company that had borrowed about $500 million from the Energy Department, to criticize the Obama administration’s climate and energy policies.

Backers of the program have argued that despite defaults like Solyndra, the program has been sustainable overall. Of the $31 billion the department has disbursed, about 40 percent has been repaid and interest payments in the fiscal year that ended on Sept. 30, 2021, totaled $533 million — more money than the failed Solyndra loan.

The Energy Department’s loan programs began in 2005 under the George W. Bush administration but expanded significantly in the Obama era. The department provided a crucial loan that helped Tesla expand when it only sold expensive two-door electric sports cars; the company is now the world’s most valuable automaker.

Under the Trump administration, which played down the risks of climate change, the department’s loan office was much less active. The Biden team has been working to change that. Last month, the department said it planned to loan $2.5 billion to General Motors and LG Energy Solution to build electric-car battery factories in Michigan, Ohio and Tennessee.

complicate the qualification process.

  • Plug-In Hybrids: After falling behind all-electric cars, U.S. sales of plug-in hybrids have been surging. The high cost of electric cars and gasoline have given them an opening.
  • Car Crashes: Tesla and other automakers capture data from their vehicles to operate their products. Experts say the collected information could also improve road safety.
  • A Frustrating Hassle: The electric vehicle revolution is nearly here, but its arrival is being slowed by a fundamental problem: The chargers where people refuel these cars are often broken.
  • One beneficiary of the new loan money could be the Palisades Power Plant, a nuclear facility on Lake Michigan near Kalamazoo, Mich., that closed in May. The plant had struggled to compete in the PJM energy market, which serves homes and businesses in 13 states, including Michigan, New Jersey and Pennsylvania, and Washington, D.C.

    The Biden administration has made nuclear power a focal point of its efforts to eliminate carbon dioxide emissions from the power sector by 2035. The administration has offered billions of dollars to help existing facilities like the Diablo Canyon Power Plant — a nuclear operation on California’s coast that is set to close by the end of 2025 — stay open longer. It is also backing new technologies like small modular reactors that the industry has long said would be cheaper, safer and easier to build than conventional large nuclear reactors.

    The owner of the Palisades facility, Holtec International, said it was reviewing the loan program and other opportunities for its own small reactors as well as bringing the shuttered plant back online.

    “There are a number of hurdles to restarting the facility that would need to be bridged,” the company said in a statement, “but we will work with the state, federal government, and a yet to be identified third-party operator to see if this is a viable option.”

    Rye Development, a company based in West Palm Beach, Fla., that is working on several projects in the Pacific Northwest.

    geothermal power; old coal power plants as sites for large batteries; and old coal mines for solar farms. Such conversions could reduce the need to build projects on undeveloped land, which often takes longer because they require extensive environmental review and can face significant local opposition.

    “We’re in a heap of trouble in siting the many millions of acres of solar we need,” Mr. Reicher said. “It’s six to 10 million acres of land we’ve got to find to site the projected build out of utility scale solar in the United States. That’s huge.”

    Other developers are hoping the government will help finance technologies and business plans that are still in their infancy.

    Timothy Latimer is the chief executive and co-founder of Fervo Energy, a Houston company that uses the same horizontal drilling techniques as oil and gas producers to develop geothermal energy. He said that his firm can produce clean energy 24 hours a day or produce more or less energy over the course of a day to balance out the intermittent nature of wind and solar power and spikes in demand.

    Mr. Latimer claims that the techniques his firm has developed will lower the cost for geothermal power, which in many cases is more expensive than electricity generated from natural gas or solar panels. He has projects under development in Nevada, Utah, Idaho and California and said that the new loan authority could help the geothermal business expand much more quickly.

    “It’s been the talk of the geothermal industry,” Mr. Latimer said. “I don’t think we were expecting good news a month ago, but we’re getting more ready for prime time. We have barely scratched the surface with the amount of geothermal that we can develop in the United States.”

    For all the potential of the new law, critics say that a significant expansion of government loans and loan guarantees could invite more waste and fraud. In addition to Solyndra, the Energy Department has acknowledged that several solar projects that received its loans or loan guarantees have failed or never got off the ground.

    A large nuclear plant under construction in Georgia, Vogtle, has also received $11.5 billion in federal loan guarantees. The plant has been widely criticized for years of delays and billions of dollars in cost overruns.

    “Many of these projects are funded based on political whim rather than project quality,” said Gary Ackerman, founder and former executive director of the Western Power Trading Forum, a coalition of more than 100 utilities and other businesses that trade in energy markets. “That leads to many stranded assets that never live up to their promises and become examples of government waste.”

    But Jamie Carlson, who was a senior adviser to the energy secretary during the Obama administration, said the department learned from its mistakes and developed a better approach to reviewing and approving loan applications. It also worked more closely with businesses seeking money to ensure that they were successful.

    “It used to be this black box,” said Ms. Carlson, who is now an executive at SoftBank Energy. “You just sat in purgatory for like 18 months and sometimes up to two years.”

    Ms. Carlson said the department’s loans serve a vital function because they can help technologies and companies that have demonstrated some commercial success but need more money to become financially viable. “It’s there to finance technologies that are proven but perhaps to banks that are perceived as more risky,” she said.

    Energy executives said they were excited because more federal loans and loan guarantees could turbocharge their plans.

    “The projects that can be done will go faster,” said William W. Funderburk Jr., a former commissioner at the Los Angeles Department of Water and Power who now runs a water and energy company. “This is a tectonic plate shift for the industry — in a good way.”

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    Inflation Cooled in July, Welcome News for White House and Fed

    Inflation cooled notably in July as gas prices and airfares fell, a welcome reprieve for consumers and a positive development for economic policymakers in Washington — though not yet a conclusive sign that price increases have turned a corner.

    The Consumer Price Index climbed 8.5 percent in the year through July, a slower pace than economists had expected and considerably less than the 9.1 percent increase in the year through June. After food and fuel costs are stripped out to better understand underlying cost pressures, prices climbed 5.9 percent, matching the previous reading.

    The marked deceleration in overall inflation — on a monthly basis, prices barely moved — is another sign of economic improvement that could boost President Biden at a time when rapid price increases have been burdening consumers and eroding voter confidence. The new data came on the heels of an unexpectedly strong jobs report last week that underscored the economy’s momentum.

    job market stays strong, Americans may begin to feel better about their personal financial situations.

    “It underscores the kind of economy we’ve been building,” Mr. Biden said on Wednesday. “We’re seeing a stronger labor market where jobs are booming and Americans are working, and we’re seeing some signs that inflation may be beginning to moderate.”

    loss of purchasing power over time, meaning your dollar will not go as far tomorrow as it did today. It is typically expressed as the annual change in prices for everyday goods and services such as food, furniture, apparel, transportation and toys.

    Fed officials remain committed to wrestling America’s rapid inflation lower, and they have raised interest rates at the quickest pace since the 1980s to try to slow the economy and bring supply and demand into balance — making supersize rate moves of three-quarters of a percentage point at each of their past two meetings. Another big adjustment will be up for debate at their next meeting in September, policymakers have said.

    But investors interpreted July’s unexpectedly pronounced inflation slowdown as a sign that policymakers could take a gentler route, raising rates a half-point next month. Stocks soared more than 2 percent on Wednesday, as Wall Street bet that the Fed might become less aggressive, which would decrease the chances that it would plunge the economy into a recession.

    “It was as good as the markets and the Fed could have hoped for from this report,” said Aneta Markowska, chief financial economist at Jefferies. “I do think it removes the urgency for the Fed.”

    Still, officials who spoke on Wednesday remained cautious about inflation. Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, called the report the “first hint” of a move in the right direction, while Charles Evans, president of the Federal Reserve Bank of Chicago, said that it was “positive” but that price increases remained “unacceptably high.”

    Policymakers have been hoping for more than a year that price increases will begin to cool, only to have those expectations repeatedly dashed. Supply chain issues have made goods more expensive, Russia’s invasion of Ukraine sent commodity prices soaring, a shortage of workers pushed wages and service prices higher and a dearth of housing has fueled rising rents.

    toward $4 in July after peaking at $5 in June, based on data from AAA. That decline helped overall inflation to cool last month. The trend has continued into August, which should help inflation to continue to moderate.

    But it is unclear what will happen next. The U.S. Energy Information Administration expects that fuel costs will continue to come down, but geopolitical instability and the speed of U.S. oil and gas production during hurricane season, which can take refineries offline, are wild cards in that outlook.

    declined in July, perhaps in part because borrowing costs rose. Mortgage rates have increased this year and appear to be weighing on the housing market, which could be helping to drive down prices for appliances.

    slow hiring. Wages are still rising rapidly, and, as that happens, so are prices on many services. Rents, which make up a chunk of overall inflation and are closely linked to wage growth, continue to climb rapidly — which is concerning, because they tend to change course only slowly.

    Rents of primary residences climbed 0.7 percent in July from the prior month, and are up 6.3 percent over the past year. Before the pandemic, that measure typically climbed about 3.5 percent annually.

    Those forces could keep inflation undesirably rapid even if supply chains unsnarl and fuel prices continue to fall. The Fed aims for 2 percent inflation over time, based on a different but related inflation measure.

    “The Covid reopening and revenge travel pressures have eased — and are probably going to continue easing,” said Laura Rosner-Warburton, senior U.S. economist at MacroPolicy Perspectives. But she also struck a note of caution, adding: “Under the hood, we’re still seeing pressures in rent. There’s still sticky inflation here.”

    And given how high inflation has been for more than a year now, Fed policymakers will avoid reading too much into a single report. Inflation slowed last summer only to speed up again in fall.

    “We might see goods inflation and commodity inflation come down, but at the same time see the services side of the economy stay up — and that’s what we’ve got to keep watching for,” Loretta Mester, president of the Federal Reserve Bank of Cleveland, said during a recent appearance. “It can’t just be a one month. Oil prices went down in July; that’ll feed through to the July inflation report, but there’s a lot of risk that oil prices will go up in the fall.”

    Ms. Mester said that she “welcomes” a slowdown in some types of prices, but that it would be a mistake to “cry victory too early” and allow inflation to continue without taking necessary action.

    For many Americans who are struggling to adjust their lifestyles to rapidly climbing costs at the grocery store and dry cleaners, an annual inflation rate that is still more than four times its normal speed is unlikely to feel like a big improvement, even as lower gas prices and rising pay rates do offer some relief.

    Stephanie Bailey, 54, has a solid family income in Waco, Texas. Even so, she has been cutting back on meals at local Tex-Mex restaurants and new clothes because of the climbing prices, which she sees “everywhere.” At Starbucks, she opts for cold, noncoffee drinks, which in some cases are cheaper.

    Her son, who is in his 20s, has moved back in with his parents. Rent had become out of reach on his salary working at a vitamin manufacturer. He is now teaching at a local high school.

    “It’s just so expensive, with housing,” Ms. Bailey said. “He was having a hard time making ends meet.”

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    How a New Corporate Minimum Tax Could Reshape Business Investments

    WASHINGTON — At the center of the new climate and tax package that Democrats appear to be on the verge of passing is one of the most significant changes to America’s tax code in decades: a new corporate minimum tax that could reshape how the federal government collects revenue and alter how the nation’s most profitable companies invest in their businesses.

    The proposal is one of the last remaining tax increases in the package that Democrats are aiming to pass along party lines in coming days. After months of intraparty disagreement over whether to raise taxes on the wealthy or roll back some of the 2017 Republican tax cuts to fund their agenda, they have settled on a longstanding political ambition to ensure that large and profitable companies pay more than $0 in federal taxes.

    To accomplish this, Democrats have recreated a policy that was last employed in the 1980s: trying to capture tax revenue from companies that report a profit to shareholders on their financial statements while bulking up on deductions to whittle down their tax bills.

    reduce their effective tax rates well below the statutory 21 percent. It was originally projected to raise $313 billion in tax revenue over a decade, though the final tally is likely to be $258 billion once the revised bill is finalized.

    would eliminate this cap and extend the tax credit until 2032; used cars would also qualify for a credit of up to $4,000.

    Because of that complexity, the corporate minimum tax has faced substantial skepticism. It is less efficient than simply eliminating deductions or raising the corporate tax rate and could open the door for companies to find new ways to make their income appear lower to reduce their tax bills.

    Similar versions of the idea have been floated by Mr. Biden during his presidential campaign and by Senator Elizabeth Warren, Democrat of Massachusetts. They have been promoted as a way to restore fairness to a tax system that has allowed major corporations to dramatically lower their tax bills through deductions and other accounting measures.

    According to an early estimate from the nonpartisan Joint Committee on Taxation, the tax would most likely apply to about 150 companies annually, and the bulk of them would be manufacturers. That spurred an outcry from manufacturing companies and Republicans, who have been opposed to any policies that scale back the tax cuts that they enacted five years ago.

    Although many Democrats acknowledge that the corporate minimum tax was not their first choice of tax hikes, they have embraced it as a political winner. Senator Ron Wyden of Oregon, the chairman of the Senate Finance Committee, shared Joint Committee on Taxation data on Thursday indicating that in 2019, about 100 to 125 corporations reported financial statement income greater than $1 billion, yet their effective tax rates were lower than 5 percent. The average income reported on financial statements to shareholders was nearly $9 billion, but they paid an average effective tax rate of just 1.1 percent.

    “Companies are paying rock-bottom rates while reporting record profits to their shareholders,” Mr. Wyden said.

    told the Senate Finance Committee last year. “This behavioral response poses serious risks for financial accounting and the capital markets.”

    Other opponents of the new tax have expressed concerns that it would give more control over the U.S. tax base to the Financial Accounting Standards Board, an independent organization that sets accounting rules.

    “The potential politicization of the F.A.S.B. will likely lead to lower-quality financial accounting standards and lower-quality financial accounting earnings,” Ms. Hanlon and Jeffrey L. Hoopes, a University of North Carolina professor, wrote in a letter to members of Congress last year that was signed by more than 260 accounting academics.

    the chief economist of the manufacturing association. “Arizona’s manufacturing voters are clearly saying that this tax will hurt our economy.”

    Ms. Sinema has expressed opposition to increasing tax rates and had reservations about a proposal to scale back the special tax treatment that hedge fund managers and private equity executives receive for “carried interest.” Democrats scrapped the proposal at her urging.

    When an earlier version of a corporate minimum tax was proposed last October, Ms. Sinema issued an approving statement.

    “This proposal represents a common sense step toward ensuring that highly profitable corporations — which sometimes can avoid the current corporate tax rate — pay a reasonable minimum corporate tax on their profits, just as everyday Arizonans and Arizona small businesses do,” she said. In announcing that she would back an amended version of the climate and tax bill on Thursday, Ms. Sinema noted that it would “protect advanced manufacturing.”

    That won plaudits from business groups on Friday.

    “Taxing capital expenditures — investments in new buildings, factories, equipment, etc. — is one of the most economically destructive ways you can raise taxes,” Neil Bradley, chief policy officer of the U.S. Chamber of Commerce, said in a statement. He added, “While we look forward to reviewing the new proposed bill, Senator Sinema deserves credit for recognizing this and fighting for changes.”

    Emily Cochrane contributed reporting.

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    How This Economic Moment Rewrites the Rules

    Indeed, the Federal Reserve is trying to cut it off. Jerome H. Powell, the Fed chair, has described the labor market, with twice as many open jobs as unemployed workers, as “unsustainably hot,” and is trying to cool it through aggressive interest rate increases. He and his colleagues have argued repeatedly that a more normal economy — less like a boomtown, with lower inflation — will be better for workers in the long term.

    “We all want to get back to the kind of labor market we had before the pandemic, where differences between racial and gender differences and that kind of thing were at historic minimums, where participation was high, where inflation was low,” Mr. Powell said last month. “We want to get back to that. But that’s not happening. That’s not going to happen without restoring price stability.”

    Mr. Biden and his advisers, too, have argued that a cooling economy is inevitable and even necessary as the country resets from its reopening-fueled surge. In an opinion article in The Wall Street Journal in May, Mr. Biden warned that monthly job growth was likely to slow, to around 150,000 a month from more than 500,000, in “a sign that we are successfully moving into the next phase of the recovery.”

    So far, that transition has been elusive. Forecasters had expected hiring to slow in July, to a gain of about 250,000 jobs. Instead, the figure was above 500,000, the highest in five months, the Labor Department reported on Friday. But the labor force — the number of people who are either working or actively looking for work — shrank and remains stubbornly below its prepandemic level, a sign that the supply constraints that have contributed to high inflation won’t abate quickly.

    Ms. Sinclair said it shouldn’t be surprising that it was taking time to readjust after the coronavirus disrupted nearly every aspect of life and work. As of July, the U.S. economy, in the aggregate, had recovered all the jobs lost during the early weeks of the pandemic. But beneath the surface, the situation looks drastically different from what it was in February 2020. There are nearly half a million more warehouse workers today, and nearly 90,000 fewer child care workers. Millions of people are still working remotely. Others have changed careers, started businesses or stopped working.

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    U.S. Economy Shows Another Decline, Fanning Recession Fears

    A key measure of economic output fell for the second straight quarter, raising fears that the United States could be entering a recession — or perhaps that one had already begun.

    Gross domestic product, adjusted for inflation, fell 0.2 percent in the second quarter, the Commerce Department said Thursday. That drop followed a decline of 0.4 percent in the first quarter. The estimates for both periods will be revised in coming months as government statisticians get more complete data.

    News of the back-to-back contractions heightened a debate in Washington over whether a recession had begun and, if so, whether President Biden was to blame. Economists largely say that conditions do not meet the formal definition of a recession but that the risks of one are rising.

    a bid to tame inflation, and the White House has argued that the slowdown is part of an inevitable and necessary transition to sustainable growth after last year’s rapid recovery.

    “Coming off of last year’s historic economic growth — and regaining all the private-sector jobs lost during the pandemic crisis — it’s no surprise that the economy is slowing down as the Federal Reserve acts to bring down inflation,” Mr. Biden said in a statement issued after the release of the G.D.P. report. “But even as we face historic global challenges, we are on the right path, and we will come through this transition stronger and more secure.”

    rising consumer prices and declining spending, the American economy is showing clear signs of slowing down, fueling concerns about a potential recession. Here are other eight measures signaling trouble ahead:

    “When you’re skating on thin ice, you wonder about what it would take to push you through, and we’re on thin ice right now,” said Diane Swonk, the chief economist for KPMG.

    Matthew Martin, 32, is paying more for the butter and eggs that go into the intricately decorated sugar cookies he sells as part of a home business. At the same time, his sales are falling.

    “I guess people don’t have as much money to toss at cookies right now,” he said.

    Mr. Martin, a single father of two, is trying to cut back on spending, but it isn’t easy. He has replaced trips to the movies with day hikes, but that means spending more on gas. He is hoping to sell his house and move into a less expensive place, but finding a house he can afford to buy has proved difficult, especially as mortgage rates have risen. He has thought about finding a conventional 9-to-5 job to pay the bills, but he would then need to pay for child care for his 4-year-old twins.

    “Honestly, I’m not 100 percent sure what I’m going to do,” he said.

    defines a recession as “a significant decline in economic activity that is spread across the economy and lasts more than a few months,” and it bases its decisions on a variety of indicators — usually only months after the fact.

    Some forecasters believe a recession can be avoided, if inflation cools enough that the Fed can slow interest rate increases before they take too much of a toll on hiring and spending.

    The economy still has important areas of strength. Job growth has remained robust, and, despite a recent uptick in filings for unemployment insurance, there is little sign of a broad increase in job losses.

    Households, in the aggregate, are sitting on trillions of dollars in savings built up earlier in the pandemic, which could allow them to weather higher prices and interest rates.

    “What drives the U.S. consumer is the healthy labor market, and we should really focus on job growth to capture the turning point in this business cycle,” said Blerina Uruci, an economist at T. Rowe Price. The Labor Department will release data on July’s hiring and unemployment next week.

    The lingering effects of the pandemic are making the economy’s signals harder to interpret. Americans bought fewer cars, couches and other goods in the second quarter, but forecasters had long expected spending on goods to fall as consumers shifted back toward prepandemic spending patterns. Indeed, economists argue that a pullback in spending on goods is needed to relieve pressure on overstretched supply chains.

    At the same time, spending on services accelerated. That could be a sign of consumers’ resilience in the face of soaring airfares and rental car rates. Or it could merely reflect a temporary willingness to put up with high prices, which will fade along with the summer sun.

    “There is going to be this element of, ‘We haven’t had a summer vacation in three years, so we’re just going to take one, no matter how much it costs,’” said Aditya Bhave, a senior economist for Bank of America. “The question is what happens after the summer.”

    Avital Ungar is trying to interpret the conflicting signals in real time. Ms. Ungar operates a small business running food tours for tourists and corporate groups in San Francisco, Los Angeles and New York.

    When restaurants closed and travel stopped early in the pandemic, Ms. Ungar had no revenue. She made it through by offering virtual happy hours and online cooking classes. When in-person tours came back, business was uneven, shifting with each new coronavirus variant. Ms. Ungar said demand remained hard to predict as prices rise and the economy slows.

    “We’re in two different types of uncertainty,” she said. “There was the pandemic uncertainty, and then there’s the economic uncertainty right now.”

    In response, Ms. Ungar has shifted her focus to higher-end tours, which she believes will hold up better than those aimed at more price-sensitive customers. And she is trying to avoid long-term commitments that could be difficult to get out of if demand cools.

    “Every annual plan I’ve done in the past three years has not happened that way,” she said. “It’s really important to recognize that what worked yesterday isn’t going to work tomorrow.”

    Lydia DePillis contributed reporting.

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