Treasury Secretary Yellen Downplays Potential for US Recession

Treasury Secretary Janet Yellen on Sunday again downplayed fears of a possible recession Sunday but admitted an economic slowdown is occurring.

Instead of a looming recession, Yellen told NBC News the U.S. economy is in “a period of transition in which growth is slowing,” which is “necessary and appropriate, and we need to be growing at a steady and sustainable pace. So there is a slowdown, and businesses can see that and that’s appropriate, given that people now have jobs, and we have a strong labor market.

“The labor market is now extremely strong … this is not an economy that’s in recession,” she said, adding, “But you don’t see any of the signs now. A recession is a broad-based contraction that affects many sectors of the economy. We just don’t have that.”

Yellen noted that many economists believe that a recession occurs when there are two consecutive periods of negative gross domestic product, or GDP. In the first quarter of 2022, the U.S. GDP slid down 1.4 percent compared with the last quarter of 2021.

Many economists expect the U.S. to see negative growth this quarter, but Yellen said even if that does happen, it doesn’t necessarily mean there’s a recession.

“Even if that number is negative, we’re not in a recession now, and we should not be characterizing that as a recession,” she said. Her comment drew pushback from NBC’s Chuck Todd, who claimed she was splitting hairs over the definition of a recession.

Yellen argued in the interview that the National Bureau of Economic Research (NBER) “looks at a broad range of data in deciding whether or not there is a recession, and most of the data that they look at right now continues to be strong.”

“I would be amazed if the NBER would declare this period to be

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