United States Secretary of the Treasury, United States Treasury
Janet Yellen’s Predictions for the US Economy | Big Take
On today’s podcast, host David Gura speaks to US Treasury Secretary Janet Yellen about everything from the health of the economy to negotiating with China. He also accompanies her on a trip to an IRS processing facility in Texas to talk about tax cheats and what to do about them.
Read more: Yellen Says Jobs Report Confirms Labor Market ‘Quite Healthy’ (https://www.bloomberg.com/news/articl...)
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About Janet Yellen
Janet Yellen, who served as Treasury Secretary under President Biden and previously chaired the Federal Reserve, has been publicly commenting on the Trump administration's economic policies and their impact on the Federal Reserve's independence. In January 2026, Yellen described a criminal investigation launched by the Trump Justice Department into Fed Chair Jerome Powell as "extremely chilling" for Fed independence, stating that she believes the administration is "weaponizing" the Department of Justice to go after people it disagrees with. She said the probe is "really about wanting to intimidate Fed leadership to be able to control monetary policy decisions, to bend monetary policy to the president's will." Yellen also commented on President Trump's removal of Fed Governor Lisa Cook, calling it "a pretext to justify an autocratic power grab." Yellen has also been critical of the Trump administration's tariff policies. In April 2025, she described the tariff program as "the worst self-inflicted wound" she has ever seen imposed on a well-functioning economy, and said the rationale for the tariffs was "unclear and not at all sensible." She estimated that the tariffs could cost the average American household around $4,000 per year. Yellen has also commented on the national debt and fiscal policy. In exchanges with Senator John Kennedy, she defended the Biden administration's budget proposals, stating that the president's budget "has improved the fiscal outlook relative to what we would have without the president's proposals" and that "revenue increases far exceed proposed investments." She also stated that she does not expect the overall level of prices to go down to pre-pandemic levels, but argued that because wages have risen, the median worker can buy the same basket of goods as in 2019 with $1,400 left over.
Transcript (25 segments)
✨ AI-enhanced transcript with speaker attribution
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David Gura0:03
Bloomberg Audio Studios, podcasts, radio news. This past weekend I had the opportunity to interview US Treasury Secretary Janet Yellen at the Texas Tribune Festival in Austin, Texas. The conversation took place at St. David's Episcopal Church. If someone had said to me, 'You're going to interview the Treasury Secretary in a church,' it would not have been on my bingo card. As you probably know, Yellen has held a lot of important jobs over the past few decades: former Federal Reserve Chair, chief economic adviser to President Clinton, and along the way, President of the Federal Reserve Bank of San Francisco. The accolades are many, the CV is long. In other words, Yellen is someone who knows a lot about what's going on in the US economy. So I began by asking her a really tough question. And let's create a little context, let's have a hard conversation. They're both: how is the burger? The burger in question was from Whataburger. I noticed that a lot of Treasury Secretary Janet Yellen's travels feature food. In and out in California, a meal with magic mushrooms in China. Well, someone had posted a photo of Yellen at Whataburger, and I needed to know how Texas's favorite fast food chain stacked up. 'They're both terrific in different ways, and I love that. It was excellent.' I promised my editor we'd make some headlines here today. We're going to try the barbecue before we leave. Excellent, not going to let that go by. Spoiler alert: I did not, in the end, get Franklin Barbecue with Janet Yellen, but I did get to ask her a lot of questions, questions you might have too, about the state of the economy, about US-China relations, about a controversial takeover of US Steel, and what Yellen hopes to accomplish before she leaves her post. Today on the podcast, the 78th Treasury Secretary Janet Yellen on everything from inflation to who does her taxes. I'm David Gura, and this is The Big Take from Bloomberg News.
My conversation with Janet Yellen on Saturday came on the heels of the August jobs report, which showed that the US economy added 142,000 jobs last month. That marks a significant slowdown. It was less than Wall Street expected, and it's a sign the US economy could be headed toward a recession. So I started by asking the Secretary what she made of that report.
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Janet Yellen2:41
Clearly, the pace of job creation has gone down, and that's something we should expect. The unemployment rate has moved up somewhat off its very low level of, I think it got down to 3.4%. But it's not common in the United States to have unemployment rates in the fours, and it's what I think of as a full employment economy. We're seeing a continued decent pace of hiring, fewer job openings, a lot fewer, but there was an enormous amount of disruption in the labor market we saw during the pandemic. So the labor market is less hot than it was in the hiring frenzy that took place as the economy opened up after the pandemic. But 140,000 jobs, this is what you expect in an economy where you don't have a lot of unemployment, and jobs need to be created for new entrants to the labor force. So nobody knows exactly what that number is, what do you need to see in terms of monthly job creation to hold the unemployment rate steady, but my guess is we're seeing something in that region, and I think this is what most people would call a soft landing.
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David Gura4:19
A soft landing. This is the thing the Federal Reserve under Yellen's successor, Jay Powell, has been trying desperately to accomplish: to slow down the economy enough to get inflation under control, but not so much so that it tips into a recession. I pushed Yellen further on whether she's confident we're there or getting there.
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Janet Yellen4:40
I think what we're seeing now is consistent with that. And while there are risks, it really has been amazing to be able to get inflation down as meaningfully as we have.
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David Gura4:55
Secretary Yellen did tell me she's keeping an eye out for certain things. One of them is if layoffs increase dramatically. She also said she's particularly sensitive to the stress rising prices place on everyone, but especially on low-income households. But overall, Yellen seems confident in how the US economy is doing. So I asked her about the rest of the world and about China in particular. You know, I look at what you've done as Treasury Secretary. You've approached it kind of like a diplomat. Treasury Secretary is a diplomat. And I want to start by asking you about your experience on US-China relations. So I didn't go on the trip with you that you took to China, but I followed the coverage of it. And aside from the 5,000 articles about the magic mushrooms that may have been on the meal that you ate there, you don't have to address that here. You've addressed that. They were delicious, they were. There was this other thread that came out, and that is you are able to carry a tough message to your counterparts, and they seem to, if not like you, hear you out, spend time with you. These meetings, as they often do when you meet with counterparts in China, last almost days, they last hours. And I was thinking of something that I saw Alan Blinder, your former colleague at the Fed, say about you, and that is: Janet Yellen makes an argument on the merits, and she sticks with it, and she's good at articulating an argument in a way that doesn't leave people on the other side hopping mad at her. What is your secret? Do you think of embracing this role as a diplomat? What has made you particularly good or have the facility for it?
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Janet Yellen6:36
Thank you for the compliment. I have seen this sort of diplomatic initiative, both with China and with other countries, as really critical because we need to work together collaboratively to solve every global problem that we face, from climate change to Russia's aggression to issues that we have with China. And during the previous administration, I'm sorry to say, our alliances frayed. And it was America first, and that should really never be America alone. And it was necessary to rebuild alliances, to work with allies around the world. And that's been a broad effort, and I think we really have succeeded.
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David Gura7:33
Do you foresee going back there as Treasury Secretary? Do you need to go back there?
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Janet Yellen7:38
I certainly may go back there. I would welcome a visit by my counterpart, the Chinese counterpart.
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David Gura7:50
Something else I was curious to ask Secretary Yellen about is a story that's been in the headlines a lot recently: that's the takeover of US Steel by Nippon Steel, the Japanese company. Bloomberg reported President Biden plans to block the $14.1 billion deal, and Vice President Harris has also spoken out against it. US Steel is an historic American company, and it is vital for our nation to maintain strong American steel companies. And I couldn't agree more with President Biden. US Steel should remain American owned and American operated. And in a rare moment of partisan unity, former President Donald Trump has said he also opposes the merger. Well, Yellen has a committee that reviews deals like this one to make sure there are no risks to US national security. And even though the Committee on Foreign Investment in the United States, or CFIUS, operates under a shroud of secrecy, I wanted to see if she'd say anything about the US Steel deal. I hoped she might be willing to give me a sense of the timetable at least.
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Janet Yellen8:56
I'm not going to comment on the specifics. What I will say is that foreign direct investment in the United States is really important, and by and large has been a huge positive for us. And it is a priority to maintain an open and healthy environment for foreign countries to invest in the United States, just as we're investing in many countries around the world. So that is the positive value. On the other hand, foreign investment in the United States can impose national security concerns.
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David Gura9:40
Hey, I tried. Coming up after the break: do you do your own taxes? I've always wondered.
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Janet Yellen9:44
For most of my life, I have. But it's gotten complicated, it's gotten a little more complicated. But most of my life, I've been a do-it-yourselfer.
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David Gura9:57
I asked Secretary Yellen about taxes and tax cheats and what's left on her to-do list in the final months of President Biden's tenure.
Morning. Well, welcome to receipt and control. You can smell the paper almost right, like you can always smell. I decided to ask Treasury Secretary Janet Yellen about her taxes because she made time on her trip to Texas to visit a huge IRS processing facility in Austin the day before my interview. I tagged along with her as she met with workers at the site. Yellen greeted hundreds of them in a cafeteria that during the pandemic was filled with paper. The processing center couldn't keep up.
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IRS Worker10:49
Prior to this year, we were operating starting machines that were 20 years old, so very aged equipment. I used to call the tech of those old machines MacGyver, right, because they were so aged we couldn't even get parts for them. But now, as a result of the $80 billion that have been allocated to the IRS under President Biden's Inflation Reduction Act, workers told Yellen the situation is much different. Earlier this year, we were able to purchase new machines and install them, and that's what you see here. In all of our processing sites, they actually run the mail faster, the sorting is more accurate. We're still learning to operate them a little bit, but much improvement needed. Definitely, thank you to IRA funds to be able to do those.
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David Gura11:37
Secretary Yellen got to see demonstrations of those new machines. Well, tax enforcement has been one of her key priorities at Treasury, and she told me at the end of that visit, before she and her staff got lunch at another Texas institution, a Mexican restaurant called Juan in a Million, that she's been pleased of late with the results.
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Janet Yellen11:58
We've now seen something like $1.3 billion collected from very high income, high wealth people who either haven't paid their taxes or who've been assessed taxes and have unpaid bills. $1.3 billion collected from high income people.
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David Gura12:18
That's a significant improvement from 2019, when the top 1% of wealthy Americans owed more than half of all unpaid taxes. And it's an implicit rebuke to Republicans who want to cut funding to the IRS. Back in the church, I wrapped up by asking Yellen what she's worried about, if she's paying close attention to any specific risks to the global financial system.
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Janet Yellen12:45
Overall, I would say for the US, the kinds of metrics that we would monitor that would summarize risks, whether it's asset valuations or the degree of leverage, things look good. There are not, I don't see red lights flashing.
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David Gura13:06
I wonder now, as we approach the end of President Biden's tenure, your tenure in this job, I should ask: are you done at the end of this administration?
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Janet Yellen13:14
Probably done, but we'll see.
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David Gura13:18
Last question, Madam Secretary. As you approach the end of your tenure, probably, what are one or two things on your very long to-do list? And we've kind of touched on all of these things that within your remit and that you're working on, that you want to get done or feel that you have to get done before there is a change in leadership at Treasury.
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Janet Yellen13:35
Well, for example, we're working very hard to complete the rule writing that we need to do. There are huge programs that we're administering, both at Treasury and in other agencies. We have the Semiconductor and CHIPS Act, and I've been hearing a lot here in Austin. You know, we continue to generate, in areas where we care a lot about, that Congress hasn't legislated the programs that the President and Vice President have put forward. So housing is a huge issue, affordable housing in many parts of the country, critical priority. We need to use every tool we have to promote that agenda, and we are. It's important for Congress to act to provide for additional construction of affordable housing, but we need to use every tool we have, and we're doing that. Child care, health care. There are things that the executive can do, and there are areas still left to address.
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David Gura14:53
You can watch my full hour-long conversation with Secretary Janet Yellen at Bloomberg.com, where you can also find all our coverage of the Treasury Department. I'm David Gura, and this is The Big Take from Bloomberg News. This episode was produced by Thomas Lu. It was fact-checked by The Big Take team. It was mixed by Blake Maples. Our senior producers are Naomi Shavin and Kim Gittleson, who also edited this episode. Nicole Beemster is our executive producer. Sage Bauman is our head of podcast. If you like this episode, make sure to subscribe and review The Big Take wherever you listen to podcasts. It helps people find the show. Thanks so much for listening. We'll be back tomorrow.