Where Is the U.S. Economy Headed? Follow the Money

The stock market is near a one-year high, giving many investors comfort. But down below, debt markets are creaking under the strain of rising interest rates.

Lending conditions for companies, consumers and real-estate developers tightened this spring to levels not seen since the height of the Covid pandemic, an analysis of public and private lending data by The Wall Street Journal shows. 

The flow of cash on Wall Street was already slowing this winter, but recent turmoil in regional banks made it worse. Wrangling over the debt ceiling has ratcheted up the...