Mnuchin: No Recession Coming

Andrew Cummings
March 18, 2020

Treasury Secretary Steven Mnuchin on Sunday dodged questions about whether the coronavirus pandemic could plunge the US into a recession, insisting that the reeling stock market would eventually get back on track and that the Trump administration is more focused on targeting short-term relief to those most affected by the fast-spreading disease.

But in two TV interviews on Sunday morning talk shows, he admitted that growth will slow as many businesses shut down for a time.

"This a unique situation", Mnuchin said Sunday on ABC's "This Week".

Health authorities have warned that the outbreak is already well-entrenched in the USA: the state of OH likely has more than 100,000 people carrying the virus, its health department said Friday.

The performance of the American economy is key to the outlook in Ireland as the State is home to many U.S. multinationals and it is a big trading partner.

"We have a lot more we need to do with Congress", Mnuchin said.

Major stock indexes have entered a bear market, ending an 11-year run that began under Trump's predecessor, President Barack Obama. "So this isn't like the financial crisis as I've said - this will have an end to it as we confront the virus".

White House economic adviser Larry Kudlow told CBS' "Face the Nation" he thinks the Senate will work on the bill on Monday and "I think the Senate will get it done pretty rapidly".

Mnuchin once again said that he would focus on getting "economic relief to the people that are impacted by this" before arguing that he "kind of" describes this as being "in the second inning".

"We are going into a global recession". "We will make sure the economy recovers".

He declined to put a price tag on the latest aid package, pointing to the unknown extent of the virus' spread and how many workers would need the paid sick leave included in the latest stimulus bill.

Secretary Mnuchin and Fed Chairman Powell are under pressure to ease investor concerns and bolster the economy.

Unlike the 2008 recession, which was underpinned by the burst of the housing bubble and other structural weaknesses in the financial sector, there are no such issues contributing to the market tumble, Mnuchin argued.

"Should you're offering liquidity to good companies that simply want liquidity for three to 6 months, the place you're taking collateral and you've got safety, that's not a bailout", he stated.

On Friday, US stocks leaped higher after the worst day for Wall Street since Black Friday in 1987, with the S&P 500 gaining 5% at the open.

Some GOP lawmakers were especially anxious about small businesses that could face cash-flow problems, even if the costs of paid leave were reimbursed later through a tax credit.

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