No matter which news article you tune in to, the world is focused on a single rallying point: Recession. Often followed by talks of ‘Stagflation,’ the fears around early recessionary trends have been picking up pace in recent times, owing to bearish investor sentiments, rising costs, the aftermath of a global pandemic, and the threat of multi-nation conflict, among other factors.
Nobel-winning economist Paul Samuelson had once quipped that Wall Street had predicted nine out of the last five recessions. While the markets may be touted as cautiously pessimistic in their approach, it is evident that we are on the cusp of a deep economic downturn, marked by steadily increasing inflation rates and a consequent uptick in interest rates.
Whether this downturn is a long-term phenomenon or a short-term contraction is a debate best left to the economists, but the implications of such downturns on consumers, on credit patterns and lending behavior of financial institutions, and how credit unions can combat this downturn by enhancing their lending strategies with AI, forms the crux of our discussion.
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