The market needs ‘resilience’ if a recession comes next year: Mohamed El-Erian
Queens College Cambridge President Mohamed El-Erian analyzes how the Federal Reserve has handled inflation on ‘Maria Bartiromo’s Wall Street.’
JPMorgan Chase President Daniel Pinto on Monday joined a chorus of Wall Street executives who are forecasting a U.S. economic recession as the Federal Reserve tries to crush runaway inflation with the most rapid interest rate hikes in decades.
Pinto – who also serves as JPMorgan's chief operating officer – stressed that wrestling inflation that is still running near a 40-year high under control should remain the Fed's top priority, even if the U.S. central bank ultimately triggers a downturn.
"That’s why when people say, ‘the Fed is too hawkish,’ I disagree," Pinto said during an interview with CNBC. "I think putting inflation back in a box is very important. If it causes a slightly deeper recession for a period of time, that is the price we have to pay."
The banking executive said that it's key the Fed doesn't allow inflation to become entrenched in the economy. If Fed officials prematurely lower interest rates, they risk repeating the mistakes of the 1970s and 1980s, when the economy was in the grips of a phenomenon known as "stagflation."