NFIB Weekly News

NFIB Weekly News Business Climate

Growing Recession Forecasts Prompt Cities To Expand “Rainy-Day” Funds. (01/29/2019)

The Wall Street Journal (1/24, Calvert, Kamp, Subscription Publication) reported that US cities are moving to expand reserve funds in a bid to reduce potential fiscal pressure if the market enters a recession. The Journal cited Matt Szabo, Los Angeles Mayor Eric Garcetti’s top budget adviser, who recently described the city’s decision to expand its reserve funds to $500 million after the 2007-2009 recession demonstrated that the prior $192 million fund was not enough to cushion the crisis. The Journal adds that JP Morgan raised its prediction of a new recession within 12 months to 40 percent, while S&P pegged the chance of a 2019 recession at a lower level of 15 to 20 percent, but also warned how major cities are struggling to save money in case.