U.S. Treasury Secretary: White House is trying to prevent a financial crisis that would "inevitably happen"
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U.S. Treasury Secretary: White House is trying to prevent a financial crisis that would "inevitably happen"
Besent pointed out that there is no guarantee against an economic recession.
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Treasury Secretary Scott Bessent
U.S. Treasury Secretary Scott Bessent said Sunday that the Trump administration is focused on preventing a financial crisis that could stem from massive government spending over the past several years.
"I can tell you, we were headed for a financial crisis," Bessent said on CNBC's "Meet the Press." "I've studied it, I've taught it. If we had continued down this path of spending, it would have been unsustainable. We're making adjustments to put everything on a sustainable footing."
Since taking office, President Trump has made fiscal discipline a top priority. He established the so-called Department of Government Efficiency, led by Elon Musk, to spearhead workforce reductions and early retirement incentives across multiple federal agencies.
However, the U.S. debt and deficit situation has worsened further during Trump’s first month in office, with the budget shortfall surpassing $1 trillion in February.
Bessent noted that there is no guarantee against an economic recession.
Markets have recently been volatile amid concerns about inflation and economic slowdown triggered by Trump’s broad tariff policies. On Thursday, the S&P 500 entered correction territory, falling more than 10% from its February peak, while market volatility surged sharply.
Bessent said pullbacks like the current market correction are normal and that, in the long run, Trump’s pro-business policies will drive both markets and the economy forward.
"I’ve been in the investment business for 35 years, and I can tell you, corrections are healthy. They’re normal. What’s unhealthy is when markets go straight up with excessive optimism—that’s what leads to financial crises. It would’ve been far better if someone had hit the brakes back in 2006 or 2007. Then we wouldn’t have faced the problems we did in 2008," he said.
Bessent added, "I’m not worried about the market. In the long run, if we get sound tax policy, reduced regulation, and ensure energy security, the market will perform very well. One week doesn’t determine the direction of the market."
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