SCSU’s Banaian: There is a Belief a Recession Can Be Avoided
Recession has been a hot topic of discussion in regards to the economy for quite some time. St. Cloud State Economist and Dean, School of Public Affairs King Banaian joined me on WJON. He says there is a belief by economists that a recession can be avoided with a "soft landing" where inflation is brought down. Banaian says the inflation rate is coming down and the unemployment rate is holding steady at 3.5% nationally. He says it is possible the Federal Reserve gets it right and a recession is avoided. Banaian stopped short of saying he is optimistic a recession can be avoided. He says locally we are probably having a recession because the sector that has been hit the worst with this has been manufacturing and construction. Banaian suggests those in retail or banking may slide by in the St. Cloud area without feeling a recession.
Gas prices is a topic Banaian and I often discuss. He doesn't expect gas prices to get as high as $4 a gallon again anytime soon. Banaian suspects gas prices won't change much in the short term. He says the Government decided to draw down the Strategic Petroleum Reserve to try and combat the shortage of gas in the first half of 2022. Banaian explains they now need to replace those reserves. He says the price is unlikely to go down because of the background demand of replenishing the Strategic Petroleum Reserve.
The State of Minnesota has a nearly $18 Billion surplus and a decision on what will become of that money hasn't been decided by the State Legislature quite yet. Banaian suspects some of the money will be used on roads and bridges with some going to tax cuts and a smaller portion being issued in checks to Minnesota tax payers.
If you'd like to listen to my conversation with King Banaian it is available below.