Is Corporate Spending About To Plunge?

Analysts, strategists and financial media outlets have dedicated quite a bit of time recently to the implications of stress in the banking sector for credit creation. Lending standards were already tightening before a trio of bank failures triggered the worst bout of turmoil in the US financial sector since Lehman. Now, it seems very likely that credit will be constrained even further. Jerome Powell himself suggested this week that the cumulative impact could be equivalent to one or more rate