Despite forecasting economic slowdown, Mnuchin says coronavirus won't cause recession

"Later in the year economic activity will pick up as we confront this virus."

March 15, 2020, 11:14 AM

Despite forecasting an economic slowdown, the president's top economic adviser said on ABC's "This Week" that he did not think the novel coronavirus pandemic would cause a recession.

Responding to ABC News Chief White House Correspondent Jonathan Karl on whether there will be a recession, Treasury Secretary Steven Mnuchin said, "I don't think so. The real issue is not the economic situation today. … This is a unique situation. We are going to have a slowdown. Later in the year economic activity will pick up as we confront this virus."

On Sunday, just days after negotiating a bipartisan coronavirus relief bill with House Democrats, he added, "The stock market is gonna go up, it's gonna go down, we can't focus on (it) every day."

The coronavirus relief bill secured passage in the House of Representatives on Friday. The economic aid package designed to help ease the financial pain of the COVID-19 pandemic, will be considered by the Senate on Monday. Trump tweeted his support of the measure on Friday ahead of the House vote.

The treasury secretary spoke to Karl after a tumultuous week in the financial markets where the Dow Jones plunged 10% on Thursday, its worst close since 1987. The Dow Jones rallied on Friday, gaining nearly 2,000 points. Still, the index is down more than 20% from recent all-time highs.

Mnuchin said the administration "will use whatever tools we have, and whatever tools we don’t have, we will go to Congress on a bipartisan basis to get more tools."

"The speaker and I are already in conversations about airlines, which is critical to us, hotels, cruise ships, more (Small Business Administration) lending, more liquidity, some type of stimulus," he said.

"As I have been saying, I think we are in the second inning of nine innings. And we will use whatever tools we need to make sure the economy and hard-working Americans get through this," he added.

PHOTO: Treasury Secretary Steven Mnuchin speaks with reporters outside White House in Washington, DC, on March 13, 2020.
Treasury Secretary Steven Mnuchin speaks with reporters outside White House in Washington, DC, on March 13, 2020.
Jim Watson/AFP via Getty Images

President Donald Trump announced one of those tools Friday when he said Google would be launching a coronavirus testing website.

But, the tech firm said Saturday it was in the "early stages" of developing a tool to help testing, contradicting the president’s announcement that "it's going to be very quickly done."

On "This Week," Mnuchin told Karl that he "(didn’t) know" when the site would come online, saying "Google has made commitments to us. They’ve been incredibly helpful. ... This is all of corporate America coming together."

"But what I'd rather focus on is, when is more money coming to the American public? What's much more important is, we need to focus on the airline industries. This is an unprecedented situation," he added.

Karl also pressed Mnuchin on whether he shared the president’s evaluation of Federal Reserve Chairman Jay Powell, who Trump blasted on Twitter Tuesday, writing that the head of the U.S. central bank was "pathetic, slow moving."

"I speak to Jay Powell now almost every single day. So, it would be inappropriate for me to make comments on specific policies that he's considering and he may do. But I can assure you he and I are in discussions, every day. They have certain tools, we have certain tools," Mnuchin said.

Mnuchin told Karl that he was unaware of any plans to move Powell out of his position.

"I’m the Treasury Secretary not the general counsel so I'm not aware of what advice the president has been given," he added.

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