Biden says recession isn't inevitable, US in position to overcome inflation

US President Joe Biden said Thursday the American people are “really, really down” after a tumultuous two years with the coronavirus pandemic, volatility in the economy and now surging gasoline prices that are slamming family budgets. But he stressed that a recession was ‘not inevitable’ and held out hope of giving the country a greater sense of confidence.

“People are really, really down. Their need for mental health in America has skyrocketed because people have seen everything upset,” Biden said. "Everything they've counted on upset. But most of it's the consequence of what happened, what happened as a consequence of the Covid-19 crisis.”

Biden addressed the warnings by economists that fighting inflation could tip United States into recession. “First of all, it's not inevitable,” he said. "Secondly, we're in a stronger position than any nation in the world to overcome this inflation.” As for the causes of inflation, Biden flashed some defensiveness on that count. “If it's my fault, why is it the case in every other major industrial country in the world that inflation is higher? You ask yourself that? I'm not being a wise guy,” he said.

The president's statement appeared to be about inflation rising worldwide, not necessarily whether countries had higher rates than the US. Annual inflation in Japan, for example, has risen in recent months though it's still at a yearly rate of 2.4%, according to the Organization for Economic Co-operation and Development.

China Budget deficit hits record

China’s broad Budget deficit in the first five months of the year ballooned by almost a trillion yuan to the worst on record as spending soared due to Covid-19 outbreaks and tax breaks to stimulate the economy caused income to drop. The government took in a combined 10.9 trillion yuan ($1.6 trillion) in general and government fund revenues in January to May, but that was far exceeded by the 13.8 trillion yuan it spent in the period. The 2.9-trillion yuan deficit, which covers the budgets for all levels of government, compares to a small surplus at the same point last year and is almost 43% bigger than in 2020, according to Bloomberg calculations. Bloomberg