Janet Yellen, the Secretary of the Treasury Department speaking on Thursday at a press conference, defended the US economic downturn and posited that the word recession is too harsh to describe the current state of the US economy.
While addressing the press, she said the US economy is not in a recession yet as it has not met the complex benchmarks that would define an economic downturn. Her statement came after the publication of gross domestic product (GDP) data which revealed the shrinking of the US economy for the second consecutive year.
Some analysts believe recession occurs when the GDP of a country drops for two straight quarters. Yellen believes the views of these analysts are incorrect as she has contrary interpretations.
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According to Yellen, the real definition of a recession is a “broad-based weakening of the economy,” and “that is not what we’re seeing right now.”
She also said a “semantic battle” about whether the country is in a recession should be “avoided.”
“What we can constructively do is talk about what is the state of the economy,” she said, highlighting that the labor market remains “exceptionally strong.”
In her words, inflation is undoubtedly the priority of Biden’s administration and there is every chance that Jerome’s Federal Reserve can fight the inflation without causing harm to the labor market.
“There’s a path to bring down inflation while maintaining a strong labor market,” Yellen said. “It’s not a certainty that that can be done, but I believe there is a path to accomplishing that.”
The continuous rise in prices of goods, shelter, and gasoline has been draining Americans’ pockets, with the rate currently at 9.1% high, Americans’ power to invest in digital assets has shrunk, Bitcoin, for instance, has dipped about 50% from its value since footing into this year, same goes with ETH and many major altcoins.
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