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By Kristin Myers, Editor-in-Chief

What's Happening Today

Comments from several Federal Reserve officials have renewed optimism that the central bank can successfully walk the tightrope it's on: achieving a "soft landing" by bringing down inflation while avoiding a recession.

Recession fears have been rising as the Fed has gotten increasingly aggressive in its fight to bring down rising prices. Slowing down economic growth makes a recession more likely and could put jobs at risk.

While I know none of us enjoy paying more for our groceries, clothes, and other items, the battle against inflation will likely bring different consequences. Borrowing money is only going to get more expensive as interest rates on loans rise, for example, which is bad news for anyone with credit card debt or hoping to buy a home. The Fed reported yesterday that U.S. household debt reached a record $16.15 trillion at the end of June. Consumers are increasingly relying on credit to help deal with rising prices, resulting in a 20-year-high spike in credit card debt.

In an interview this morning, St. Louis Fed President James Bullard said it was difficult to say the U.S. was in a recession, given the strength of the labor market. Bullard also gave a speech Tuesday where he noted that he believes the U.S. could avoid a recession as the central bank fights inflation. San Francisco Fed President Mary Daly also reinforced the bank's commitment to fighting inflation, saying the "work was far from done" in an interview on Tuesday.

Stocks are on the rise today after a brief dip in markets kicked off the week. It's hard not to feel like we all have whiplash from all the volatility of this rollercoaster ride, and unfortunately, it probably won't be over anytime soon.

Investors will likely turn their attention to earnings and remarks from Federal Reserve officials today in advance of the employment summary that will be released on Friday. According to data from FactSet, the number of companies making surprise beats to corporate earnings expectations is on the rise, pointing to the resilience of the U.S. economy even in face of rising inflation. More than half of the country's largest companies on the S&P 500 have reported earnings, and roughly three-quarters of them have done better than expected.

- Kristin

Editors' Picks

Fed's James Bullard Expresses Confidence That the Economy Can Achieve a 'Soft Landing' (CNBC)

Federal Reserve Tools and How They Work (The Balance)

Credit Card Debt Surges as Inflation Pushes Americans to Borrow More (The Washington Post)

Should I Take Out a Personal Loan To Pay Credit Card Debt? (The Balance)

Senate Plan Would Put Bitcoin, Ether Under Commodity Regulator's Watch (The Wall Street Journal)

How Does Bitcoin Work? (The Balance)

5 Stock Market Mistakes To Avoid (The Balance)

Term of the Day

Soft Landing

Like an airplane, you want a "soft landing"—not a crash—for the economy if you're trying to deliberately slow it down. That's why the term is often used to describe the Federal Reserve's goal for slowing down the economy in order to tamp down inflation.

In other words, the Fed has begun raising its benchmark interest rate, the fed funds rate, to cool the economy and rein in the sharp increases in consumer prices. By raising borrowing costs throughout the economy, the Fed will discourage spending and slow economic growth. But Fed officials must not overdo it, slowing it so much that the economy slips into a recession. That would be a very hard landing.

It's a delicate balancing act, and one that Fed Chair Jerome Powell has acknowledged is not going to be easy. Fed officials believe the economy is strong enough that it can be brought in for a soft landing, but some economists think the odds are against it.

Off the Charts

Credit card debt is a type of revolving debt. You can keep borrowing month after month, as long as you repay enough that you never owe more than your credit limit. Credit card accounts can be used indefinitely, unlike installment loan accounts that are closed once the balance is paid off. This type of debt can easily get ahead of you, however, potentially wreaking havoc on your finances and your credit score. And the longer it takes you to pay off the debt, the more likely it becomes that you might end up owing more than you originally charged on your card.