US could experience ‘mild’ recession but doesn’t anticipate one: Biden

  • In an interview with CNN’s Jake Tapper, President Joe Biden discussed the possibilities of a recession.
  • Biden said he didn’t think there would be a recession, but if there was, it would be “mild.”
  • He also pointed to recent legislative victories, such as the Cut Inflation Act that targets health care costs.

President Joe Biden is not very worried about a recession, although some alarm bells are ringing.

In an interview with CNN’s Jake Tapper, Tapper asked Biden if the American people should prepare for a recession. Biden’s answer: a resounding “no”.

“I don’t think there will be a recession,” Biden said. “If it does, it will be a very slight recession. That is, we will go down slightly.”

Biden’s comments come as the International Monetary Fund warns the global economy is heading for a slowdown that could wreak more havoc than initial expectations. Kristalina Georgieva, managing director of the IMF, said in a speech there was a “fundamental shift” in the global economy – and a “darkening global outlook” means people on the ground will see their incomes and stability financial decline.

“We are in a better position than any other major country in the world, economically and politically,” Biden said. “We still have real problems, but look what we’ve done.” He pointed to the administration’s multitude of legislative victories, including its first stimulus package and the recently passed Cut Inflation Act, which will target the climate crisis and health care costs.

But major economic figures in the United States are still sounding the alarm about a potential slowdown. Former Treasury Secretary Larry Summers told Bloomberg that the economy was “probably headed for some kind of collision.” JPMorgan CEO Jamie Dimon said soaring inflation and the ongoing war are likely to “push the United States into some kind of recession, six or nine months from now.” And CEOs are preparing for a recession.

So far, however, the recession fears of the start of the year have not materialized. While some companies have downsized, the layoff rate is still near historic lows. Companies may be slowing down their hiring, but workers still feel comfortable switching jobs for a better deal. Biden stressed that the alarm bells so far have not led to a slowdown.

“Every six months they say this. Every six months they look at the next six months and say ‘look, it’s going to happen,'” Biden told Tapper. “It hasn’t happened yet.”

The US economy is doing well, according to the latest data on hiring and job growth. That’s good news for workers right now, but it could also mean a bigger sting next year. Inflation remained persistently high. This is worrying for the Fed, which will likely continue to raise interest rates in hopes of reducing inflation – and likely increase unemployment at the same time.

But when it comes to the recession, “it’s possible. Look, it’s possible,” Biden said. “I don’t anticipate it.”

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