I am here at the Treasury Department with the Treasury Secretary Janet Yellen for an exclusive.

It's good to see you again.

Thanks so much, Sarah.

Thanks for the invitation.

Thank you for taking the time.

So, 2023, I think the big surprise was the U.S. economy's resilience.

You've been in the soft landing camp for a while.

But this time last year, how many people were predicting recession?

Well, I do remember that there were dire predictions

that a recession was utterly unavoidable. But I have to say, I always felt what I said was,

I believe there's a path by which the economy could achieve a soft landing.

Inflation coming down with the labor market remaining strong.

And it was not necessary to have a period of high inflation,

a high unemployment to bring inflation down.

I thought that because I never felt that inflationary expectations

had been permanently dislodged in a way that would give rise to an ongoing wage price spiral

that makes inflation self-perpetuating.

What I thought was that there were major disturbances in many product markets

because of the pandemic and supply chain issues connected with it,

and that the labor market had also experienced a severe shock with an unprecedented

number of people losing jobs. When the economy started recovering rapidly, they had to get

back into good matches with new employers.

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