OAN NEWSROOM
UPDATED 9:16 AM PT – Monday, May 16, 2022
Senior Chairman of Investment Bank Goldman Sachs, Lloyd Blankfein said a US recession is, in fact, possible and consumers should be ready for it.
“It’s definitely a risk…if I were a consumer, I’d be prepared for it, but it’s not baked in the cake,” he stated during an interview Sunday.
Blankfein said the Federal Reserve may be able to prevent an economic downturn, but it could be hard to avert in the face of runaway inflation. The Goldman Sachs executive added, elevated inflation may persist for a long time, which may worsen quality of life for millions of Americans.
“Some of the supply chain shocks will go away, but some of it will be a little bit stickier and will be with us for a while,” he explained. “And while we’re talking about this in the macro sense, overall for individuals and certainly the individuals at the bottom quartile of the pie sharing, it’s going to be quite difficult and oppressive.”
Blankfein went on to say he believes the US financial system will get through this crisis and risks will reduce after the Ukraine crisis is over. Meanwhile, economist Robin Woods, a former Chief FX Strategist at Goldman Sachs, echoed Blankfein’s warning while suggesting a global recession is coming.
Global recession is coming. The two biggest export economies in the world – Germany (blue) & China (black) – are seeing their new export orders in the manufacturing PMIs fall sharply. That’s deteriorating global demand as we teeter towards recession. Only outlier: the US (red)… pic.twitter.com/u5ntWz7fXa
— Robin Brooks (@RobinBrooksIIF) May 8, 2022
Woods pointed to Germany and China, who he noted have the two biggest export economies in the world. He pointed out that both are “seeing their new export orders in the manufacturing PMIs fall sharply.”
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