Meredith Whitney, the analyst who predicted the 2008 financial crisis, warns that the US economy could face a difficult reckoning in the fourth quarter. Weekly credit card balances are growing more slowly than in May, suggesting a loss of momentum in consumer spending. Households are also under pressure from rising gasoline prices on their disposable income, particularly among lower-income consumers. She describes the situation as a two-speed economy, where semiconductor companies and wealthy households perform well while lower-income consumers reduce their spending. Whitney expects the Federal Reserve to leave interest rates unchanged and attributes elevated borrowing costs primarily to federal debt and fiscal policy.
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