Janet Yellen: Treasury secretary says she’s not seeing signs of a recession in the US economy



CNN

U.S. Treasury Secretary Janet Yellen said in an exclusive interview with CNN on Thursday that she sees no signs of a recession anytime soon as the U.S. economy rebounds from a six-month contraction.

In a one-on-one interview with CNN’s “Erin Burnett OutFront” in Ohio, Yellen said Thursday’s third-quarter GDP numbers underscore the The U.S. economy is gaining momentum as policymakers act urgently to cool widespread and soaring inflation. had a major impact on Americans’ perceptions of the economy — and jeopardized the Democratic majority on Capitol Hill with the midterm elections less than two weeks away.

“Look, what we’re seeing now is solid growth this quarter. After a quick recovery from high unemployment, growth has slowed significantly,” Yellen said when asked if the latest GDP data had eased any recession fears. “We’re in a full employment economy. It’s only natural that growth will slow. It’s outpaced the first three quarters of the year, but it’s still OK. We have a very strong labor market. At this point, I don’t Seeing signs of a recession.”

Yellen’s optimism comes amid growing concerns among economists and fiscal officials that a recession could occur sometime next year, but was partly based on factors from the latest data showing signs of a needed slowdown in key areas of the economy, leading to economic recession. The path to a “soft landing” comes as the Fed prepares to continue its rapid pace of rate hikes.

Gross domestic product, the broadest measure of economic activity, grew at an annualized rate of 2.6 percent in the third quarter, according to preliminary estimates released Thursday by the Bureau of Economic Analysis. This was a turnaround from a 1.6% decline in the first quarter of the year and a 0.6% decline in the second quarter.

But Yellen’s views also underscore the complex balancing act President Joe Biden and his top economic officials have attempted to strike during the year as they seek to emphasize a quick economic recovery and major legislative wins, while also pledging to tackle soaring prices.

“Inflation is very high — unacceptably high, and Americans feel that way every day,” Yellen said when asked how the administration compared its view of the U.S. economy to rising voter dissatisfaction . Yellen acknowledged that it would take a while for oil prices to fall back, and said efforts to bring them down to levels “people are more accustomed to” are likely to continue “for years to come.”

That reality undercuts the administration’s efforts to capitalize on what officials see as a solid track record. Asked about the economy last week, Biden told reporters that the economy was “very strong,” drawing criticism from Republicans.

But Yellen agreed with the president’s assessment that the economy is still strong and stands out compared to the performance of the rest of the world.

“If you look around the world, there are a lot of economies that are not only affected by high inflation but are also very weak, and the U.S. stands out. Our unemployment rate is at a 50-year low. … We saw in this morning’s report –Consumer spending and investment spending continue to grow. We have solid household finances, business finances and well-capitalized banks,” she said.

“This is not an economy in recession and we continue to do well,” she added.

Yellen also acknowledged frustration within the administration that efforts to pull the U.S. economy out of the crisis haven’t received the credit officials believe it deserves.

“We may have several issues that many American families may face,” Yellen said. “These are problems that we don’t have because of what the Biden administration has done. So people don’t usually get credit for problems that don’t exist.”

Yellen traveled to Cleveland as part of the administration’s push for a major legislative victory and the tens of billions of dollars in private-sector investment those policies have driven into manufacturing across the country.

This is a key part of an economic strategy to address the many vulnerabilities and failures exposed as Covid-19 ravages the world, with the federal government investing heavily in infrastructure and supporting or creating critical supply chains from scratch. Important section.

Listing a series of major private sector investments, including a $20 billion Intel factory that opened a few hours’ drive outside of Columbus, Yellen said they were “real tangible investments that are happening right now,” although She admits they will take time to fully take effect.

Yellen promised that those efforts would be reflected in the economy in the months and years ahead. Asked if the administration’s general message to Americans was one of patience, Yellen said: “Yes.”

“But you’re starting to see repaired bridges coming online — not in every community, but coming online soon. Many communities will see roads improved, bridges repaired, already falling apart. We’re seeing money flowing into R&D, which Really a great source of long-term strength for the U.S. economy. America’s strength will grow, and we’ll be a more competitive economy,” she said.

Yellen also touched on the battle lines drawn this week over raising the debt ceiling, a now-permanent crisis in Washington that House Republicans recommitted to taking advantage of if they gain a majority.

“The president and I agree that the United States should not be held hostage by members of Congress who believe it can downgrade the country’s credit rating and threaten default on the U.S. Treasury, which is the bedrock of global financial markets,” Yellen said. .

But Yellen, who has long emphasized the “destructive” nature of the showdown, also supports legislation to remove the debt limit altogether. A group of House Democrats wrote to Democratic leaders asking for the action in a lame-duck session of Congress, an idea Biden rejected this week.

When asked about the division, Yellen said only that she and Biden agreed that “it’s really up to Congress to raise the debt ceiling.”

“It’s absolutely necessary to get it done, and I want to see it happen the way it could,” Yellen added.

As the government moves towards a period that has traditionally led to senior officials leaving the government, she has made it clear she does not intend to be a part of it. Asked about the report that she had told the White House she wanted to stay in next year, Yellen said it was an “accurate reading.”

“I’m very excited about the projects we’re talking about,” Yellen said. “I see a huge strengthening of economic growth, fighting climate change and strengthening American families. I want to be a part of that.”

Source

Also Read :  Indianapolis convention and show business recover from pandemic

Leave a Reply

Your email address will not be published.

Related Articles

Back to top button