The International Monetary Fund and other experts warn of an economic downturn.
Addressing recent predictions that the U.S. economy is headed for recession, President Joe Biden maintains that it is not inevitable.
Biden made an appearance on CNN in an interview with Jake Tapper Tuesday.
“I don’t think there will be a recession,” Biden said. “If it is, it will be a very slight recession. That is, we’ll move down slightly.”
Tapper cited JPMorgan Chase CEO Jamie Dimon’s prediction that a recession was likely in six to nine months, mentioned Bank of America’s prediction that the U.S. could start losing 175,000 jobs per month, and then brought up the high gas prices issue that won’t seem to go away. He then asked the president if people should be preparing for a recession.
“Every six months they say this,” Biden said, “Every six months they look down the next six months and say what’s going to happen. It hadn’t happened yet. There’s no guarantee there’s going to be recession. We’re in a better position than any other major country in the world — economically and politically. We still have real problems. But look what we’ve got done.”
Biden brought up the passing of the Inflation Reduction Act. “There’s so much that’s been accomplished that the idea that there is an automaticity to recession is just not there.”
Tapper pressed him on the fact he had earlier mentioned a slight recession is possible.
“Look, it’s possible. I don’t anticipate it,” the president said.
A clip of the interview was posted to Twitter by @CNN.
IMF Issues Recession Warning
The International Monetary Fund warned Tuesday that inflation, energy and food crises and high interest rates were threatening a global recession. It cut its 2023 Global GDP growth forecast from 2.9% in July to 2.7%.
While the first in-person International Monetary Fund and World Bank annual meetings in three years began, the IMF said the countries with the largest economies in the world were in danger.
“The three largest economies, the United States, China and the euro area, will continue to stall,” Pierre-Olivier Gourinchas, the IMF’s chief economist, said in a statement reported by Reuters. “In short, the worst is yet to come, and for many people, 2023 will feel like a recession.”
“It’s difficult to think of a time where uncertainty was so high,” the global lender’s monetary and capital markets director Tobias Adrian, told Reuters. “We have to go back decades to see so much conflict in the world, and at the same time inflation is extremely high.”
Jamie Dimon’s Prediction
JPMorgan Chase CEO Jamie Dimon had recently told CNBC that while the economy is still doing well, inflation, high interest rates and the Ukraine war were a cause for concern.
“These are very serious things which … are likely to put the U.S. in some kind of recession six to nine months from now,” he said.
Dimon said he thinks the Federal Reserve waited too long to raise rates and is forced to act quickly and decisively now.
“Let’s keep our fingers crossed that they manage to slow down the economy enough so that whatever it is, is mild — and it is possible,” he said.