[tlogan]

I think this is just a temporary slump caused by the SVB failure. The economy is not doing great but it is not in a complete metldown.

I do expect interest rate to continue going up: inflation seems to be quite stubborn.

[jameslk]

When lending stops, people stop buying things[0], like cars and houses. Or all that crap on Buy Now, Pay Later plans. There's these huge credit bubbles we have[1] that are going to be deflated very quickly once debt is no longer easily and cheaply available.

0. https://en.wikipedia.org/wiki/Credit_cycle

1. https://en.wikipedia.org/wiki/Everything_bubble

[LarsAlereon]

Bingo, banks are realizing that they underestimated their deposit risk so are lending less to build their reserves up to levels they now think are healthy. It sucks if you need access to capital right now, but it means we'll be less likely to see another bank failure next month.

If someone wants to chicken little about anything it should be wages not rising to keep pace with inflation. If unchecked this would eventually cause a collapse in consumer demand that WOULD melt down the economy.