The Daily Money: Could stimulus money drying up signal a recession?

Happy Tuesday, TDM readers! This is Swapna Venugopal Ramaswamy bringing you today’s headlines.

Americans socked away substantial amounts of money during the pandemic. But now that reserve is running dry.

The pandemic-related savings and government aid that have helped prop up the U.S. economy over the past three years are dwindling, posing new strains for low- and moderate-income households and hazards for a nation at risk of slipping into recession by early 2024.

In interviews and a Harris Poll survey for Paste BN, Americans whose COVID cash reserves are running low say they’re putting off home projects, eating out less, canceling subscriptions and taking out loans to make ends meet.

And that’s bad news when it comes to U.S. consumer spending, which makes up 70% of economic activity.

Overall, the shrinking trove – along with rising credit card interest rates, high inflation and a cooling job market -- could tip the nation into a recession by next year, some forecasters say.

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Each weekday, The Daily Money delivers the best consumer news from Paste BN. We break down financial news and provide the TLDR version: how decisions by the Federal Reserve, government and companies impact you.