Update 553 — Last Rodeo at Jackson Hole?Rush to Renominate Fed Chair Powell Slows Investors and observers await Federal Reserve Chair Jerome Powell’s speech tomorrow at the Kansas City Fed’s annual Jackson Hole Conference. Issues abound: inflation, the still-recovering labor market, tapering down Fed’s balance sheet, and the economic uncertainty from the Delta variant. Unspoken is whether …
Update 545 — Powell Promotes Recovery;Accommodates Growth and Mild Inflation Federal Reserve Chair Jerome Powell testified this week before the House Financial Services and Senate Banking Committees. Since his last testimony in February, the economy has begun to improve, with strong GDP growth expected this year. Inflation, as expected, has increased. He has much to say about …
Update 535 — Optimal Levels of Inflation:What to Hope For and Expect in Recovery The May jobs report, out today, reflects an economy in transition, headed steadily toward recovery. U.S. employers added 559,000 jobs last month and the unemployment rate went down by 0.3 percent. The favorable trajectory still leaves open the length of recovery …
Update 534 — Megabank CEOs Hit Hill:Issues, Attacks Heard; Less So Consensus The CEOs of the six “megabanks” testified before the Senate Banking and House Financial Services Committees this week, addressing issues ranging from the pandemic response to climate risk to racial justice to wage disparities. Some questions arose concerning the banking sector itself but …
Update 527 — Yellen Moves MarketsAnd Can Remove FSOC Roadblocks The Federal Reserve surprised no one last Wednesday by continuing its near-zero interest rate policy and large-scale asset purchases. But markets tumbled Tuesday after Treasury Secretary Janet Yellen mentioned the possibility of raising rates, at some point, to prevent the economy from overheating. In the …
Update 516 — Support for Recovery (Act)?Powell Faces Fiscal, Macro Policy Potpourri Federal Reserve Chair Powell and Treasury Secretary Yellen both appeared before the House Financial Services (HFSC) yesterday and Senate Banking today. The main takeaway from them: the economic recovery needs additional federal support. The ARP will boost the economy and the Fed projects …
Update 490 — Another Budget Battle?Over What? And How Can the Fed Help? With days dwindling until the December 11 deadline for a budget deal needed to avert a government shutdown, Congress is negotiating yet another Continuing Resolution, which will alter federal spending priorities not at all as economic conditions continue to worsen. What’s the …
Update 489 – A Barber on the Board:Get Ready; Less Steady Fed Ahead? After months of inaction on Trump’s nomination of Judy Shelton to the Board of the Fed, Senate Majority Leader Mitch McConnell is rushing this one with days ticking down before Senator-elect Mark Kelly can be sworn in. Shelton’s nomination as a national …
Update 485 – Amid COVID Relief Failure,The Premise and Promise of Repurposing Now that the election is underway and the hopes for Corona relief are vanishing and COVID cases are spiking, the return on inaction is now reflected in the full retreat of capital markets and a dead-cat bounce, in Wall Street parlance, expected in …
Update 474: Monetary Policy ReimaginedWhat the Fed’s Momentous Moves Mean With no recent fiscal action from Congress, all eyes have been on the Federal Reserve. Leery of criticism of TARP and other financial policy responses during the Great Recession, the Fed recently announced a series of new changes to its approach. These changes may augur …
