On Tuesday’s broadcast of “CNN This Morning,” Bank of America CEO Brian Moynihan responded to a question on how Bidenomics is working by stating that after all of the pandemic stimulus, “you now have a situation where inflation has to be fought” and that the bank has predicted a recession starting in the first part of 2024. Moynihan also stated that getting inflation down to the Fed’s target rate will take “all of this year and all of next year” and into 2025.

Co-host Poppy Harlow asked, “Do you think Bidenomics — this is the new term — is it working for most Americans?”

Moynihan responded, “I think, if you look, the U.S. has been fighting inflation. So, after the pandemic, the amount of fiscal stimulus and monetary stimulus, i.e. the money — the lower rates and the money that the government pushed out to offset the impact of the COVID-19 pandemic, you now have a situation where inflation has to be fought. So, rates have gone up. And so, what we have predicted is a recession starting the first part of next year. Actually, we moved it from the latter part of this year to the first part of next year, but it’s a mild recession. And that’s given the strong jobs, the strong employment levels, wage growth is still strong, but inflation is still higher than they want — than it should be. And so, the Fed has the rates to push that down and that’s going to be a little bit of a collision course. Interestingly enough, you’re starting to see the aspects of a slowdown come through. Our consumer spending shows it — that behavior is slowing down, which is good and bad. Good in that that’s what the Fed needs to see, inflation under control. Not so good, because it does mean we have a higher probability of that mild recession coming true.”

He added, “Our projection is for two quarters of negative GDP growth, minus 1%, minus 0.5%. That is not a huge downturn. … It will be mild. And what that means is the unemployment levels will get — we get it up as high as almost 5%, high 4s. But that’s kind of interesting, because we used to think 4.5% was full employment.”

Moynihan further stated that inflation has “flattened out, it’s tipped down in areas. But there are areas where it’s not necessarily tipping down to the level they want. And that’s why we think it will take them all of this year and all of next year…and into ’25 before they get inflation in line with their long-term targets.”

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