Is the U.S. Economy Too Hot or Too Cold? Yes.

 Is the U.S. Economy Too Hot or Too Cold? Yes.

Here’s a riddle: What is both too hot and too cold? The answer: the United States economy in the summer of 2021.

That is the common thread that comes through in economic data; shifts in financial markets; anecdotes from businesses; and experiences of ordinary people who are simultaneously enjoying higher incomes and facing higher prices and shortages.

In the mid-2021 economy, employers are offering higher pay to attract scarce workers; airports and car lots are bustling; and a G.D.P. report due out next week will probably show blockbuster growth. It is also an economy in which inflation is outstripping pay gains for many workers; the share of the population working remains far below prepandemic levels; and bond markets are priced at levels that suggest a high risk of returning to sluggish growth in the years ahead.

Essentially, the economy is having a harder time rebooting itself than had seemed likely in the heady days of spring,…

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