Janet Yellen expressed her concern over the US-China trade war. She is worried that America’s highest economic growth may get ceased by the war.
The first women leader of the Federal Reserve, Yellen isn’t confident in her prediction of a recession strike in the year to come. At the World Business Forum New York, she said that the chances are so exceptionally high that it makes her comfortable.
The former Fed Chief believes that the US economy is at a downside risk which will also bring a slowdown to global growth.
Yellen said that this situation is very worrisome. She served as Fed’s chairwoman from 2014 to 2018 when President Trump replaced her with Jerome Powell.
Wall Street has recently receded the recession fears.
As the China-US trade negotiations and economic stabilization showed apparent progress, the Dow shot up past 28,000 last week. The US, however, withdrew its stocks recently over concern that an initial trade accord may not be signed until 2020.
Keeping in mind the fact that only 3.6% of the US population is unemployed, Yellen said that the US economy, overall, is still doing fine.
Businesses are in such dire need of manpower that incompetent workers and criminal record-holders are being hired. Yellen considers this progress since workers are getting the experience and training that they very much need.
Yellen further mentioned that the American household is not overburdened with debt anymore, like the previous decade. US economy keeps progressing due to consumer spending,
The trade war and the slow global growth have, however, slammed the manufacturing industry. Germany just managed to narrowly avoid a recession and China managed to grow its economy at the slowest rate in 27 years.
Yellen had warned that the rest of the economy could be infected by those troubles. She said the trade and global weaknesses affecting the job market could be seen.