A bear market for the U.S. economy seems imminent. So far this year, markets have faced higher short-term yields, widening credit spreads, and dwindling liquidity. This report lays out reasons why inflation will not decelerate as much as hoped… but also why the economy will likely not face a recession in 2022. High oil prices caused by Russia’s invasion of Ukraine have imposed extra costs across the economy. U.S. incomes rose 13% last year in nominal terms, but real growth of 4% seems even less significant against consistent inflationary pressures felt at all points of the economy. Still, despite myriad challenges, the U.S. will avoid slipping into recession this year.