Treasury sec. Janet Yellen admits economic ‘slowdown’ but downplays recession worries


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Treasury Secretary Janet Yellen acknowledged on Sunday that the US was in an economic “downturn” but downplayed the possibility of a recession, saying the country was in “transition” after rapid economic growth.

“The economy is slowing down,” Yellen told NBC News’ Meet the Press, adding that a correction is “appropriate” for a healthy economy.

“The job market is extremely strong right now,” she said. “This is not an economy that is in recession, but we are in a period of transition where growth is slowing down. And it is necessary and appropriate, and we need to grow at a sustainable and sustainable pace. and business is seeing that, and it’s fitting given that people now have jobs and we have a strong job market.”

“But right now you don’t see any signs – a recession is a wide-ranging recession that affects many sectors of the economy. We just don’t have it,” she added. “I would say that we are seeing a slowdown.”

Treasury Secretary Janet Yellen testifies before the House Ways and Means Committee on Capitol Hill in Washington, June 8, 2022. (AP Photo/Jose Luis Magana, File/AP Newsroom)

Yellen went on to say that the “common definition” of a recession is two consecutive quarters of negative GDP, and while economists expect to see negative growth again this quarter after recording -1.4% last quarter, that still doesn’t mean that the US is in recession.

Since the Biden administration called inflation “transitional”, the US has 13 MONTHS OF CONSTANT RISING COSTS

“Even if this number is negative, we are not in a recession right now and we should not characterize this as a recession,” she said.

Janet Yellen and Joe Biden

US Treasury Secretary Janet Yellen (center) listens to President Joe Biden during a hybrid meeting with corporate executives and members of his cabinet to discuss the looming federal debt ceiling in Executive Eisenhower’s Southern Courtroom. (Chip Somodeville/Getty Images/Getty Images)

NBC host Chuck Todd countered, stating that the secretary was “parting hair” over the definition.

“I mean, if the technical definition is a two-quarter contraction, you’re saying it’s not a recession,” Todd said.

“That’s not a technical definition,” Yellen countered. “There is an organization called the National Bureau of Economic Research that analyzes a wide range of data when deciding whether there is a recession or not, and most of the data they look at right now remains reliable. I would be surprised if the NBER declared this period a recession, even if it had two quarters of negative growth. We have a very strong job market. When you create almost 400,000 jobs a month, it’s not a recession. “

Yellen’s comments come from a former economic adviser to Obama. Larry Summers told CNN on Sunday that “there is a very high possibility of a recession” and “very unlikely” that the US will have a “soft landing”. Summers warned last month that a recession is “almost certain, probably 75%, 80% likely over the next two years, and there is certainly a real risk that it will come sooner.”

Janet Yellen sits next to President Biden at a cabinet meeting

President Joe R. Biden speaks with Treasury Secretary Dr. Janet Yellen during a cabinet meeting in the Cabinet Office. (Sarah Silbiger for The Washington Post via Getty Images/Getty Images)

The United States has experienced 13 consecutive months of skyrocketing inflation since the Biden administration, including Yellen, dismissed concerns about rising spending and said the contributing factors were “temporary.”


Yellen admitted in May of this year that “then she was wrong about the path that inflation would take.”

Inflation jumped to 9.1% in June, the fastest rate of inflation since December 1981.

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