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Washington
CNN Business
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Amazon founder Jeff Bezos recently warned consumers and businesses that they should consider postponing major purchases in the coming months as the global economy battles a recession and faces a possible recession.
The business leader offered his most important advice for the sluggish economy in an exclusive sit-down interview with CNN’s Chloe Melas on Saturday at Bezos’ Washington, DC, home.
Bezos has urged people to put aside spending on big-ticket items like new cars, televisions and electronics, noting that delaying big purchases is the surest way to keep “powder dry” in the event of a prolonged recession. Meanwhile, small businesses may want to avoid making large capital expenditures or purchases during this uncertain time, Bezos added.
If enough consumers follow Bezos’s advice, it could mean lower sales for Amazon, the e-commerce giant Bezos founded and created most of the billionaire’s fortune.
The New York Times reported on Monday that Amazon plans to cut its workforce, laying off 10,000 workers, the largest reduction in the company’s history. That’s in addition to previously announced hiring freezes for its corporate staff. The company is second only to Walmart in the number of people it employs in the United States.
Amazon (AMZN) said in October that it expects sales for the final three months of the year to be well below Wall Street’s expectations. The weak forecast came as rising inflation and fears of a looming recession weigh on consumer purchasing decisions as Americans focus more on travel and eating out and less on potential purchases.
The company’s stock fell more than 40% as rising prices and changing consumer behavior weighed on Amazon and the broader technology sector.
Bezos said that the possibility of worsening economic conditions makes it prudent to save some money if it is an option.
“Take the risk off the table,” he said. “A small reduction in risk can make a difference.”
Last month, Bezos tweeted a warning to his followers on Twitter, advising them to “beat the leaves.” The advice was intended for business owners and consumers alike, Bezos said in an interview.
Many may feel overwhelmed right now, he added, but as an optimist he believes the American dream “exists and will become more attainable in the future” – predicting that in his lifetime, space travel will be widely accessible to society. society.
Although the US economy is not, technically, in a recession, nearly 75% of likely voters in a recent CNN poll said they feel like it is. Incomes have increased, but not enough to keep pace with inflation, especially the high prices of essentials such as food, fuel and shelter. For those invested in stocks, it hasn’t been a great year, however, and it’s been tough for retirees living off their investments.
Other business leaders have issued similar messages about the economy in recent months. Tesla ( TSLA ) and Twitter CEO Elon Musk last month admitted that demand for Tesla ( TSLA ) was “a little hard” to come by, and noted that Europe and China are facing a “recession.” Musk also warned that Tesla ( TSLA ) will fall short of its growth targets.
JPMorgan Chase CEO Jamie Dimon in October lashed out at the stock market by saying a recession could hit the United States within six to nine months.
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