‘Face The Nation’: Former Goldman Sachs CEO Lloyd Blankfein Says Economy At Risk Of Recession

May 15, 2022 2:55pm

As inflation and interest rates rise, there is a “very, very high risk” factor for an economic recession. That’s according to former Goldman Sachs CEO Lloyd Blankfein, who addressed the issue Sunday on CBS talk show Face The Nation.

Can it be avoided? “There’s a path. It’s a narrow path,” said Blankfein, who is retired from Goldman Sachs, but still holds the title of senior chairman.

“But I think the Fed has very powerful tools. It’s hard to finely tune them, and it’s hard to see the effects of them quickly enough to alter it, but I think they’re responding well. It’s definitely a risk.”

Blankfein’s remarks come on the heels of similar sentiments from Federal Reserve Chairman Jerome Powell, who said last week that the Fed’s strategy of raising interest rates will “include some pain.”

“We fully understand and appreciate how painful inflation is,” Powell said in an interview with the Marketplace national radio program.

Powell said the process of curbing inflation includes raising interest rates at least the next two Federal Reserve meetings. “The process of getting inflation down to 2% will also include some pain,” he allowed. “But ultimately, the most painful thing would be if we were to fail to deal with it and inflation were to get entrenched in the economy at high levels, and we know what that’s like. And that’s just people losing the value of their paycheck.”