Chief Secretary to the United Kingdom Treasury Simon Clarke (pictured) told the Times Radio on Monday that the government does not expect a recession. Clarke stressed that the British economy has “considerable underlying strengths” despite “very significant challenges” globally. Earlier, he told Sky News that the pay in the public sector will not be increased over inflation levels as the inflation issue could “either intensify or prolong itself.”
Yellen says recession is not inevitable
REHOBOTH BEACH, Del. — Treasury Secretary Janet Yellen said Sunday that she expects the U.S. economy to slow in the months ahead, but that a recession is not inevitable. Yellen offered a dose of optimism even as economists grow increasingly worried about a recession fueled by skyrocketing inflation and the Russian invasion of Ukraine. Yellen said overall consumer spending in the United States remains strong, while noting that spending patterns are changing, given the impact of rising food and energy prices. Yellen said household savings during the coronavirus pandemic will help sustain spending. The national saving rate has fallen to about 6%, below pre-pandemic levels, after reaching 16.6% in 2020, the highest on record dating to 1948, and 12.7% in 2021.
“I expect the economy to slow,” Yellen said. “It’s been growing at a very rapid rate and the economy has recovered and we have achieved full employment. We expect a transition to steady and stable growth, but I don’t think a recession is at all inevitable.”
The Federal Reserve on Wednesday approved its largest interest rate increase in more than a quarter-century to stem a surge in inflation. The move raised the target federal funds rate by three-quarters of a percentage point to a range of between 1.5% and 1.75% The tightening of monetary policy was accompanied by a downgrade to the Fed’s economic outlook, with the economy now seen slowing to a below-trend 1.7% rate of growth this year, unemployment rising to 3.7% by the end of this year and continuing to rise to 4.1% through 2024. Yellen said it will take “skill and luck” to bring down inflation while maintaining low unemployment. “I believe it’s possible,” she said.
Biden says a recession is ‘not inevitable’
WASHINGTON (AP) — President Joe Biden said Thursday the American people are “really, really down” after a tumultuous two years with the coronavirus pandemic, volatility in the economy and now surging gasoline prices that are slamming family budgets. But he stressed that a recession was “not inevitable” and held out hope of giving the country a greater sense of confidence. Speaking to The Associated Press in a 30-minute Oval Office interview, the president emphasized the battered economy that he inherited and the lingering psychological scars caused by a pandemic that disrupted people’s sense of identity. He bristled at claims by Republican lawmakers that last year’s COVID-19 aid plan was fully to blame for inflation reaching a 40-year high, calling that argument “bizarre.” As for the overall American mindset, Biden said, “People are really, really down.” “Their need for mental health in America has skyrocketed because people have seen everything upset,” Biden said. “Everything they’ve counted on upset. But most of it’s the consequence of what happened, what happened as a consequence of the, the COVID crisis.” That pessimism has carried over into the economy as record prices at the pump and persistent inflation have jeopardized Democrats’ ability to hold on to the House and Senate in the midterm elections.
Biden addressed the warnings by economists that fighting inflation could tip United States into recession. “First of all, it’s not inevitable,” he said. “Secondly, we’re in a stronger position than any nation in the world to overcome this inflation.”
As for the causes of inflation, Biden flashed some defensiveness on that count. “If it’s my fault, why is it the case in every other major industrial country in the world that inflation is higher? You ask yourself that? I’m not being a wise guy,” he said. The president’s statement appeared to be about inflation rising worldwide, not necessarily whether countries had higher rates than the U.S. Annual inflation in Japan, for example, has risen in recent months though it’s still at a yearly rate of 2.4%, according to the Organization for Economic Co-operation and Development. Asked why he ordered the financial penalties against Moscow that have disrupted food and energy markets globally, Biden said he made his calculation as commander in chief rather than as a politician thinking about elections. “I’m the president of the United States,” he said. “It’s not about my political survival. It’s about what’s best for the country. No kidding. No kidding. So what happens? What happens if the strongest power, NATO, the organizational structure we put together, walked away from Russian aggression?” Biden spun out the possibility of chaos in Europe if an unimpeded Russia kept moving deeper into the continent, China was emboldened to take over Taiwan and North Korea grew even more aggressive with its nuclear weapon ambitions. NN: the truth is the US is already in a recession just ask the big box store guys. Their consumer shit is NOT selling. My belief the 4th of July weekend will be the last hurrah. People will be shocked at the prices they will have to pay. After the last supper (BBQ) they will hunker down. Their savings is gone and consumer debt is exploding. You damn straight their is going to be a big bag recession. And with the out to lunch clueless leadership that is in power worldwide its damn near hopeless. They will continue to fuck things up royally. Can you believe the head of the FED Reserve with all the resources and tools they have had missed the greatest inflation in 40 years. What good as these Doctoral laureates? And to add insult to injury Chairman Powell got to keep his job……..