Lloyd Blankfein, Senior Chairman of Goldman Sachs, urged companies and consumers to prepare for a US recession.

Blankfein said on CBS that he would be prepared if he were running a large company.

He said that a recession is not baked in the cake and there is a narrow path to avoid it. The former Goldman chief executive officer said that the Federal Reserve has powerful tools to control inflation.

US consumer sentiment fell in early May to the lowest level in four years because of high fuel prices and a baby formula shortage. US consumer prices rose 8.3% in April from a year ago, slower than in March but still the fastest rate in decades.

There is a possibility of a soft landing for the U.S. economy.

Some of the inflation will go away as supply chains in China ease, but there are some things that are a little bit stickier.

He said that Americans benefited from globalization, which made goods and services cheaper because of cheaper labor abroad.

Blankfein said that they can't control the supply chains that are not within the borders of the United States.