3min chapter

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Episode 31: Post-FOMC/SVB Analysis

Guggenheim Macro Markets

CHAPTER

The Fed's Performance in Cooling Down the Jobs Picture

Small banks account for 38% of total bank lending. Even before any of this stress started, we could see in the Fed senior loan officer survey that the share of banks tightening lending standards was already at levels consistent with previous recessions. As small banks face more deposit pressure in a more uncertain environment, those lending standards are only going to tighten further. Some kind of credit crunch and we think that's sizable enough to cause a recession to start by the middle of the year.

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