Treasury Secretary Janet Yellen Discusses US Economy, Recession Risk, Soft Landing

U.S. Treasury Secretary Janet Yellen believes that the level of inflation has decreased significantly, but there is still progress to be made for the Federal Reserve to reach its 2% inflation target. She emphasized that the central bank needs to manage two risks. "One is the possibility that inflation does not decrease to their target level as anticipated, and the other is the risk of the economy becoming too weak," she explained.

Yellen Discusses U.S. Economy

During an interview with CNBC on Wednesday, U.S. Treasury Secretary Janet Yellen discussed the current state of the U.S. economy. This discussion took place as the Federal Reserve maintained its interest rates unchanged for the third consecutive time.

Yellen acknowledged that "Inflation has significantly decreased," but she cautioned that "there is still progress to be made for the Fed to achieve its 2 percent goal. However, I believe we are on the right track, and we can observe a consistent pattern of inflation decreasing over time." The U.S. November Consumer Price Index showed a 3.1% increase on an annual basis.

When asked about the possibility of the U.S. economy entering a recession, Yellen responded:

"In any given year, even if you have no knowledge about the economy, there is always a recession risk of over 10%. So, there is always some level of recession risk. However, I don't think it is particularly high at the moment. Consumer spending has remained strong."

Yellen emphasized, "Gradually over time, I believe people will feel more positive about the economy," while acknowledging that people have noticed that "the prices of certain goods and services are higher than they were before the pandemic." She specifically mentioned, "They notice this increase in their bills, such as apartment rentals."

Furthermore, Yellen reiterated her belief that the U.S. economy is heading towards a soft landing. She expressed optimism that growth would continue into 2024, stating, "I think there is a reasonable chance of achieving this. We are on the right path. My expectation is that we will experience a soft landing," the Treasury Secretary explained.

Addressing the possibility of the Federal Reserve reducing interest rates next year, Yellen stated, "As inflation decreases, it is natural for interest rates to also decrease to prevent an increase in real interest rates, which could tighten financial conditions." She added:

"The Federal Reserve has two risks to manage. The first is the possibility that inflation does not decrease to their target level as anticipated, and the second is the risk of the economy becoming too weak. I will leave the decision on interest rates to them."

What are your thoughts on Treasury Secretary Janet Yellen's statements? Share your opinions in the comments section below.

Frequently Asked Questions

What is the best precious-metal to invest?

The answer to this question depends on how much risk you are willing to take and what type of return you want. While gold is considered a safe investment option, it can also be a risky choice. For example, if you need a quick profit, gold may not be for you. If you have time and patience, you should consider investing in silver instead.

If you're not looking to make quick money, gold is probably your best choice. Silver might be a better investment option if steady returns are desired over a long period of time.

Should You Invest in gold for Retirement?

It depends on how much you have saved and if gold was available at the time you started saving. If you are unsure which option to choose, consider investing in both options.

Not only is it a safe investment but gold can also provide potential returns. Retirees will find it an attractive investment.

Most investments have fixed returns, but gold's volatility is what makes it unique. Its value fluctuates over time.

But this doesn't mean you shouldn't invest in gold. Instead, it just means you should factor the fluctuations into your overall portfolio.

Another advantage to gold is that it can be used as a tangible asset. Gold is much easier to store than bonds and stocks. It can be easily transported.

Your gold will always be accessible as long you keep it in a safe place. You don't have to pay storage fees for physical gold.

Investing in gold can help protect against inflation. Because gold prices tend to rise along with other commodities, it's a good way to hedge against rising costs.

Additionally, it will be a benefit to have some of your savings invested into something that won't lose value. Gold usually rises when stocks fall.

Another benefit to investing in gold? You can always sell it. Like stocks, you can sell your position anytime you need cash. You don't even have to wait until you retire.

If you do decide to invest in gold, make sure to diversify your holdings. Don't put all of your eggs in one basket.

You shouldn't buy too little at once. Start with just a few drops. Then add more as needed.

Keep in mind that the goal is not to quickly become wealthy. It's not to get rich quickly, but to accumulate enough wealth to no longer need Social Security benefits.

And while gold might not be the best investment for everyone, it could be a great supplement to any retirement plan.

Can I keep a Gold ETF in a Roth IRA

Although a 401k plan might not provide this option, you should still consider other options like an Individual Retirement Account (IRA).

Traditional IRAs allow contributions from both the employer and employee. Another option is to invest in publicly traded corporations with an Employee Stockownership Plan (ESOP).

An ESOP offers tax benefits because employees can share in the company stock and any profits that it generates. The money you invest in the ESOP will be taxed at a lower rate than if it were directly held by the employee.

Also available is an Individual Retirement Annuity. With an IRA, you make regular payments to yourself throughout your lifetime and receive income during retirement. Contributions to IRAs will not be taxed


  • The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (
  • You can only purchase gold bars at least 99.5% purity. (
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (
  • Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (
  • Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (

External Links

How To

Online buying gold and silver is the best way to purchase it.

Before you can buy gold, it is important to understand its workings. Precious metals like gold are similar to platinum. It's very rare and is used as money because of its durability and resistance to corrosion. It's difficult to use, so most people prefer purchasing jewelry made from it rather than actual bars.

There are two types currently available: legal tender and bullion. Legal tender coins can be used for circulation within a country. These coins usually come in denominations such $1, $5 and $10.

Bullion coins can only be used as investment currency. They increase in value due to inflation.

They can't be exchanged in currency exchange systems. If a person purchases $100 worth of gold, 100 grams of the gold will be given to him/her. The $100 value is $100. For every dollar spent, the buyer gets 1 gram of Gold.

You should also know where to buy your gold. There are several options available if your goal is to purchase gold from a dealer. You can start by visiting your local coin shop. You can also try going through a reputable website like eBay. You can also look into buying gold online from private sellers.

Private sellers are individuals who offer to sell gold at retail or wholesale prices. Private sellers will charge you a 10% to 15% commission for every transaction. That means you would get back less money from a private seller than from a coin shop or eBay. This option is often a great one for investors in gold, as it gives you greater control over the item's value.

An alternative option to buying gold is to buy physical gold. You can store physical gold much more easily than you can with paper certificates. However, it still needs to be safe. Physical gold should be stored in an impenetrable container, such a vault and safety deposit box to ensure its safety.

When buying gold on your own, you can visit a bank or a pawnshop. A bank can give you a loan up to the amount you intend to invest in Gold. Small establishments that allow customers to borrow money for items they have brought are called pawnshops. Banks typically charge higher interest rates than pawn shops.

A third way to buy gold? Simply ask someone else! Selling gold can be as easy as selling. Contact a company such as, and you can set up a simple account and start receiving payments immediately.

By: Kevin Helms
Title: Treasury Secretary Janet Yellen Discusses US Economy, Recession Risk, Soft Landing
Sourced From:
Published Date: Thu, 14 Dec 2023 23:00:27 +0000

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