Former Goldman Sachs CEO Lloyd Blankfein says economy is at risk of recession
As inflation and interest rates rise, there is a “very, very high risk” factor for an economic recession. That’s according to former Goldman Sachs CEO Lloyd Blankfein, who addressed the issue on the CBS talk show on Sunday. Face the Nation.
Can it be avoided? “There is a way. It’s a narrow path,” said Blankfein, who is retired from Goldman Sachs but still holds the title of senior chairman.
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“But I think the Fed has very powerful tools. It’s hard to fine-tune them, and it’s hard to see the effects quickly enough to change them, but I think they respond well. is definitely a risk.
Blankfein’s remarks follow similar sentiments from Federal Reserve Chairman Jerome Powell, who said last week that the Fed’s strategy of raising interest rates “will include some pain.”
“We fully understand and appreciate how painful inflation is,” Powell said in an interview with the national radio show Marketplace.
Powell said the process of fighting inflation includes raising interest rates at least the next two Federal Reserve meetings. “The process of reducing inflation to 2% will also include some pain,” he admitted. “But ultimately the most painful thing would be if we failed to deal with it and inflation took root in the economy at high levels, and we know what that is. And that are just people losing the value of their paycheck.
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