New data seem to disprove the recession in the US that has been given almost for certain by all analysts, but there are some clarifying remarks to be made.
Bernstein: recession in the US is a long way off
In an interview with the press, Jared Bernstein returned to talk about numbers and how they relate to the country’s future.
During the briefing, economic advisor Bernstein said:
“Job growth and other economic indicators are incompatible with recession”.
The US economy is in too good a state of health to be or to enter a recession anytime soon, this much is clear from the official’s words.
Employment cannot be so pronounced and enjoy such good health in times like these, just as Americans cannot spend so much on non-primary goods and services if we actually were to hit the wall of a recession.
If there were this danger, people would direct their purchases toward basic necessities and be more judicious in their choices.
Another figure that strikes a jarring note is precisely that on employment. Although it is slightly down, the figure is very good: everything suggests that there is no crisis or problem of any kind at the gates.
This picture throws water on the sentiment. or rather the fear of analysts about an impending recession, but to be certain we will have to wait for the GDP figure on the 28th of this month that will confirm or not the negative trend of GDP in the second half of the year. If so, the US would enter the so-called technical recession.
Should it enter technical recession (this happens wanting to summarize drastically when for two consecutive semesters GDP is negative) there would be distinctions to be made.
What could lead the United States into a technical recession
Certainly the employment data and the data on how people direct their choices in everyday spending are an anomaly.
As for the issue of the energy crisis, the US is going forward with a strong hand, on the one hand pushing hard on sanctions on Russia that result in isolating Moscow and seeking raw materials from other countries (such as Arab countries), and on the other hand increasing storage and self-production of what is needed.
White House spokeswoman Karine Jean-Pierre, speaking to reporters, made other interesting statements touching on this very topic.
On oil and President Joe Biden‘s behavior toward Saudi Arabia, the public has been inquiring for days.
Journalists thus pressed the spokeswoman on the matter, who said:
“The success of the talks that President Biden had in Saudi Arabia in terms of the drop in the price of gasoline in the United States can be measured in the next two weeks. We believe that there will be an increase in production but it is up to the OPEC countries and the we will see in the next two weeks”.
On the same topic, Jared Bernstein calmed investors and the American people by touching on the subject of the price cap instead.
The G7 countries and their partners are moving toward an agreement that would allow the price of oil to have its normal all-time fluctuations in terms of price without it exceeding a certain limit (price cap).
“Discussions on Russia’s oil price cap continue. There are conversations with G7 allies and partners about imposing a price cap and these conversations go on”.