Billionaire Jeff Bezos has predicted that the U.S. economy could contract by 2023, so people can prepare for a recession by cutting back on big-ticket purchases like TVs and cars. rice field.
Amazon founders have outlined that Americans can “take risk off the table” by keeping cash in case of emergency. His top tips for surviving the recession.
Speaking to CNN Business, the entrepreneur said people should avoid big purchases and save some “dry flour” for the future.
He added that he could not predict how long the recession would last, but said that if the U.S. was not in recession, it was likely to be in “soon.”
The warning comes from the founder of one of the country’s largest retailers, which relies on strong consumer spending to generate revenue.
Inflation-stricken consumers are sluggish and increasingly using credit lines to make ends meet. Household debt surged to $16.51 trillion last quarter, the fastest increase since 2008, according to new data this week.
Annual inflation fell to 7.7% last month, the lowest level since January, but many economists say a sharp recession marked by heavy job losses may be inevitable in the next year. I believe.
Layoffs can be especially difficult for families who have depleted their savings to meet rising food, gas and utility bills.
Personal savings balances, which surged as people were stuck at home during the pandemic lockdown, are now down to about half their pre-pandemic levels, according to Commerce Department data.
Amazon founder Jeff Bezos predicts the U.S. economy could contract by 2023, so people should prepare for a recession by cutting back on big-ticket purchases like TVs and cars. said he could.
Last month, Bloomberg’s economic forecasts hit 100% for a 12-month recession forecast to October 2023, with a higher likelihood of a recession in all timeframes.
Inflation-stricken consumers, after depleting their savings, made a living and increasingly took advantage of credit lines.
Similarly, the personal savings rate fell to 3.1% in September, well below the 2019 pre-pandemic average of 8.8%.
According to The New York Times, Amazon itself plans to lay off up to 10,000 employees, making it the largest mass layoff in the company’s history.
Multiple news outlets have reported that the cuts represent about 3% of Amazon’s roughly 300,000 corporate employees, with warehouse and transportation workers unaffected.
Reuters reported that Amazon began notifying workers in its devices and services division of the layoffs on Wednesday, but did not specify how many jobs would be cut or for how long.
The retail company, which derives most of its revenue from web services, is the second largest individual employer in the United States, second only to Walmart.
“The economy doesn’t look good right now. Things are slowing down. We’re seeing layoffs in so many sectors of the economy,” Bezos said.
Inflation hit a 40-year high over the summer as the Federal Reserve hikes interest rates to combat inflation, raising the risk of a sharp recession.
The Federal Reserve is deliberately cooling the economy by raising borrowing costs for families and businesses, but as interest rates rise, the likelihood of a recession increases.
Total household borrowing in the third quarter reached $16.51 trillion, up $351 billion from the previous quarter and up 8.3% from the year-ago quarter.
The number of credit card accounts is growing rapidly as auto and home loans shrink or shrink.
He added that he could not predict how long the recession would last, but said the U.S. was likely to be in a recession “soon” if it hadn’t already.
In the first half of 2022, the U.S. economy, as measured by Gross Domestic Product, contracted for the second straight quarter, meeting one of the informal definitions of a recession.
But President Joe Biden vehemently denied that a recession had started, and many economists agreed.
GDP returned to growth in the third quarter, increasing by 2.6%, largely due to a reversal of the same technological factors that caused the contraction in the first half.
After years of explosive growth, the tech sector has been hit hardest by tightening credit conditions, with Silicon Valley seeing massive layoffs in recent weeks.
It remains to be seen whether mass layoffs will start spreading across the economy, but so far the labor market has remained historically tight.
The unemployment rate remained low at 3.7% in October, just off the lowest level in 60 years before the start of the pandemic.
GDP growth in Q3 2022 was 2.6%, the first growth since Q4 2021.
In a new interview, Bezos appeared with his girlfriend of 52, Lauren Sanchez, after embarking on a charity project.
The news comes after the founder announced that he would donate most of his $124 billion fortune to charities fighting climate change.
Bezos said he wants to unite humanity and help those who can heal deep social and political divides.
The mogul didn’t give specific details to which charities he donates to, how much he donates, or when during an interview with CNN.
That comes as his e-commerce giant Amazon is about to lay off thousands of employees in the weeks leading up to the busy holiday season.
“We’re building the ability to donate this money,” the businessman said, sitting side by side with his partner Lauren Sanchez.
“The hard part is figuring out how to do that with leverage,” Bezos said. “It’s not easy. Building Amazon wasn’t easy.
“I always said, ‘I’m going to put my money where my heart is,'” the country music legend said when she accepted the award. I will do my best to do
“It takes a lot of hard work, I have a lot of very smart teammates, and the philanthropic work turned out to be very similar. It’s not easy, it’s very difficult.”
“We are building our capacity to donate this money.
“So we have to think carefully and we need good people in the team.”
Bezos has been accused of failing to sign pledges by hundreds of the world’s richest people to donate much of their wealth to charity.
The world’s fourth-richest person refused to say exactly how much he donated or where it might be spent.
He has refrained from setting a lifetime giving goal and has donated $10 billion (about 8% of his current net worth) to the Bezos Earth Fund over 10 years.
Bezos also announced the award on Friday, explaining why he gave Dolly Parton $100 million for “love and compassion at work.”