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For 91.9 KVCR News, I’m Madison Aument. This is Economics I.E. UCLA’s Anderson School of Management released a report last week detailing weaknesses in the U.S. and California economies.
The report warns that rising layoffs across the country could lead to a recession.
UCLA’s Anderson Forecast found that the combination of the Trump administration's tariffs and lowered interest rates could lead to what the report calls “stagflation-lite.” Stagflation happens when unemployment rates and inflation are high. Clement Bohr, who’s the chief economist on the report, predicts that full-on stagflation could happen if inflation rises and President Trump successfully exerts more control over the Federal Reserve.
The report says the labor market, quote, "deteriorated notably in June," when inflation began to exceed gradual normalization. Inflation saw a downward trend until May and has been rising to what the report calls “uncomfortable levels.” UCLA predicts inflation will continue to rise. A small amount of inflation is due to tariffs, but UCLA warns that tariffs that have yet to take effect could push prices even higher. That inflation will likely continue through 2025.
UCLA predicts that third-quarter GDP growth, adjusted seasonally, will come in at one percent and will weaken more as tariffs continue. The forecast was compiled before the government shutdown and does not account for possible layoffs.
In related inflation news, WalletHub compiled a list of the top 10 metro areas where inflation is climbing the fastest. The Inland Empire was ranked number seven. The Consumer Price Index rose two-tenths of a percent from June to August, and around three and a half percent from a year ago.
In other economics news, President Trump canceled more than $1 billion in California clean energy grants at UCs, including UC Riverside. UC Riverside will lose a $6 million grant to develop catalytic technology to reduce methane pollution in the production of liquefied natural gas. Gas prices are expected to climb in Southern California after a fire last week at the state’s second-largest oil refinery. Officials say the price hike depends on how long the refinery in El Segundo will be out of operation. The Chevron refinery supplies about 20 percent of all motor vehicle fuels and 40 percent of all jet fuel consumed in Southern California. The Los Angeles Times noted the region already faces tight supplies due to limited refinery capacity in the state, which imports hundreds of thousands of barrels of gasoline daily. The average price of a gallon of gas in San Bernardino and Riverside Counties is about $4.60. The national average is $3.13.
That wraps up Economics I.E. for this week. Join us again next Monday. This segment is supported by the Nowak Family. For KVCR News, I’m Madison Aument.
I want to know how people who live in the Inland Empire are dealing with inflation. Did you have to get another job or start doing Instacart? If you’re interested in being interviewed about your experience with inflation, email me at maument@kvcr.org.
