Investors all over are scratching their heads, trying to figure out where the market will head in 2023. Inflation has finally started to cool, but now the question is, how much of a hit will the economy take after the Federal Reserve's aggressive interest rate hikes this year?

Will there be a recession in 2023? If so, how severe will that recession be? Is unemployment about to skyrocket? How will the Fed's unwinding of its balance sheet impact markets? Or are concerns overblown, and is the Fed about to engineer a soft landing for the economy, in which inflation continues to come down and unemployment only rises modestly?

It's anyone's guess right now, but here's what could happen to the market in 2023: the good case, the base case, and the ugly.

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Source Fool.com