JUDY WOODRUFF: Now a conversation with one of the most important policy-makers in the
world about the state of the U.S. economy, shifts in the job market, and a look at why
Americans' wages still stubbornly lag behind other economic trends.
I sat down this afternoon with the chairman of the Federal Reserve, Jay Powell.
It was part of the Atlantic Ideas Festival, taking place at the Harman Center for the
Arts here in Washington, D.C.
Hello, Mr. Chairman.
JEROME POWELL, Federal Reserve Chairman: Hi, Judy.
How are you?
JUDY WOODRUFF: Delighted to be here with you and with everybody here.
So, as we sit here on October 3, 2018, we seem to be in a Goldilocks economy.
The economy is growing at a healthy clip.
Inflation seems to be under control.
The unemployment rate is -- is down, some say historically down.
And we have a stock market that just seems to keep breaking records.
How long can it last?
JEROME POWELL: I wish I knew.
So, you're right.
The economy, initially, after the Great Recession, began growing in the second half of 2009,
and at times struggled.
But we have made a lot of progress slowly over the years.
And now I'm very happy to say that we're -- we are at -- 3.9 percent unemployment is the
lowest in 20 years.
We're growing at about 3 percent, which is above almost everyone's estimate of the longer-run
trend growth, which implies that, if we do grow at that rate, unemployment will go down
further.
If does, it'll be the lowest unemployment rate in 50 years, since the late 1960s.
Meanwhile, inflation is right at our 2 percent goal.
So it's a remarkably positive set of economic circumstances.
And I -- you know, we're working hard to try to sustain the expansion and keep employment
-- keep unemployment low and keep inflation right on target.
JUDY WOODRUFF: But do you think it can go on indefinitely?
JEROME POWELL: Indefinitely is a long time.
(LAUGHTER)
JEROME POWELL: I think there's no reason to think that it can't continue for quite some
time, though.
Eventually, external events, exogenous events happen, and not every business -- business
cycles don't last forever.
But there's -- there's really no reason to think that this cycle can't continue for quite
some time, effectively indefinitely.
JUDY WOODRUFF: So, let's talk about two of those measures.
Unemployment, you talked about it, it's under 4 percent.
It's been declining.
Inflation, it's hovered, what, around 2 percent...
JEROME POWELL: Right around 2 percent.
JUDY WOODRUFF: ... for a long time.
Now, the Fed used to consider it a trade-off.
When the unemployment rate was dropping, there were worries that inflation was going to go
up, and vice versa.
Has that cycle ended?
Do we know?
Are we no longer seeing that kind of a trade-off anymore?
JEROME POWELL: So, it has changed.
It's -- you can't say that it's ended.
If you go back to -- the last time we had unemployment below 4 percent was the late
1960s.
So, for four years, you had unemployment go into the mid 3's, and inflation took off.
So there was a strong relationship between very low levels of unemployment and tight
levels of resource utilization, inflation.
And central banks around the world really stepped up and got inflation under control.
And to the extent the public believes that central banks will keep inflation around 2
percent, which is one of our main jobs, that has tended to reduce the sensitivity of inflation
to changes in unemployment.
That's where we are now.
But we got there by having a credible commitment to keeping inflation on target.
So it's not something we can -- we have to keep that commitment.
But, for now, our inflation dynamics are that inflation remains at 2 percent, and it doesn't
react very much to -- even to further declines.
JUDY WOODRUFF: Let's talk about wages.
Growth, wage growth overall still very sluggish, not withstanding Amazon's announcement yesterday
that it's raising the minimum wage there.
Do you expect that to continue?
JEROME POWELL: So wages, if you go back about five years, you saw the range of wage and
compensation measures were clustered around 2 percent growth.
Now, those measures are around 3 percent growth, which is sort of consistent with the underlying
economics.
Wages and compensation should cover inflation, plus the increase in productivity, which amounts
to about 3 percent.
The mystery really is, why, in a very tight labor market -- we get reports from all around
the country, from country -- companies in different industries, that -- that labor markets
are really tight, they can't find qualified people.
So it's a bit of a mystery why they're not bidding up this scarce commodity of labor
more.
So, we do -- we have seen a gradual increase in wages.
And my own expectation would be that we would continue to see some of that.
And it would be quite welcome.
We don't think that we're in danger of a situation where -- particularly imminent danger of a
situation where wage increases are going to promote price inflation.
And our focus is price inflation.
JUDY WOODRUFF: But do you think something may have fundamentally changed about what's
going on with wages?
I mean, are we now at a point where workers' bargaining power has declined in a significant,
long-lasting way?
JEROME POWELL: There may be something in that, yes.
It's a different -- I think, in an era of globalization and an era of technological
evolution, it may be that workers and companies have internalized the idea that lots and lots
of jobs can be done all around the world, or can be, you know, supplanted by technology.
So, there may be something in that.
I would say, though, it's -- you know, as we always say, it's too soon, really, to say.
Wages have been moving up.
And that's in keeping with a tight labor market.
And we do expect that to continue.
JUDY WOODRUFF: Still on jobs.
A number of experts out there who point out there were many people who were laid off from
their jobs, from their work during the recession who were never able to get back to full-time
work, that many of them ended up in part-time jobs, and some of them just stopped looking
altogether.
How do you read that?
What is your sense of that?
JEROME POWELL: No, so it's true.
I mean, the financial crisis costs a lot of people their jobs and their homes and their
careers and their hopes and dreams to some extent.
And so we want to avoid that.
And, you know, over the 10 years, really, since the depths of the crisis, we have seen
a tremendous recovery in the in the labor market and the economy generally.
Labor force participation is back up to normal levels, in fact, even indeed above normal
levels.
It doesn't mean that this strong economy is -- has reached every American.
It hasn't.
You know, we know that there are demographics and their are regions and industries and individuals
who have not have not been affected, haven't gotten their jobs back.
And so these big negative events are quite costly, like a financial crisis.
So we have done really a lot of things over the course of the last decade to try to avoid
having that experience again.
JUDY WOODRUFF: Now, let's talk about something -- I guess your favorite subject, interest
rates.
Right now, it seems to me half the world is worried that you are raising rates too slowly.
They say growth is so strong, the labor markets are so tight, inflation could take off.
The other half of the world doesn't want you to raise rates at all or as much as you are.
They argue you are widening the inequality gaps that are already out there, that, as
we have been discussing, wages are too low.
You obviously think you're threading the needle about right.
But what makes you so sure?
JEROME POWELL: So it sounds like we're doing something right.
I will talk about the two risks that you mentioned.
So the first risk is that we -- that we move too quickly and we prematurely end the expansion,
and inflation never gets solidly back to 2 percent.
And that's always a risk at this point in the cycle, where the economy has been growing
now for nine years.
It's in its 10th year of growth.
The alternative risk is that we move too quickly -- too slowly -- sorry -- and the -- too slowly
-- and the economy overheats.
And that can show up in the form of too high inflation or financial market imbalances and
that kind of thing.
So you look at those two risks.
So, for a long, long time after the financial crisis, the second risk wasn't a risk at all.
We were far away from full employment and inflation was below target.
So, we kept rates low for a long, long time.
We kept them at zero for a long time.
And we had a lot of advice to move more quickly and raise interest rates.
And I'm very happy we didn't follow that advice, because I think it benefited the country,
benefited workers and their families.
So, now we have come to a situation where unemployment, as I mentioned, is close to
a 20-year low and headed lower, by all accounts.
And the really extraordinarily accommodative low interest rates that we needed when the
economy was quite weak, we don't need those anymore.
They're not appropriate anymore.
We need interest rates to be gradually, very gradually moving back towards normal.
JUDY WOODRUFF: President Trump, as you have noted, he started out early on talking about
how he believes the Fed should remain independent.
And he's been given credit for appointing high-quality nominees to the Fed Board.
But he's also this summer -- this past summer criticized the Fed, the policy of raising
rates.
Do write that off as -- excuse me -- as just politics?
Or does it put some kind of pressure on you, as the chairman of the Fed?
And does it harm the institution, because this is something presidents have rarely done?
JEROME POWELL: We -- my focus is essentially on controlling the controllable.
And that's -- we control what we do.
(LAUGHTER)
JEROME POWELL: What we do at the Fed.
And, you know, this is -- to anyone who has known our institution over time, this is just
who we are and I think who we will always be, which is, we're a group who -- we're quite
removed from the political process.
And we look at the best thinking, we look at the data very carefully, we try to get
disparate views, try to come to a consensus, and try to do the right thing.
We're insulated from political cycles, because our terms run -- they don't run continuously
-- or the same cycle as elections.
And we just try to do the right thing for the medium and longer term for the country.
And, you know, that's -- I think that's why a lot of people want to work at the Fed, is
because there's tremendous satisfaction doing that.
We don't let other things distract us.
And we're just going to focus on -- on those jobs.
That's just always how we're going to be.
JUDY WOODRUFF: Did you have a communication privately with the president after he made
those comments?
JEROME POWELL: No.
JUDY WOODRUFF: You said recently that you have been hearing a rising chorus of concerns
from businesses around the country about tariffs.
What exactly are you hearing?
JEROME POWELL: People are concerned about rising material costs and tariffs and the
loss of markets and supply chains in a big way.
These supply chains have been under construction, and now very fully built out over the course
of almost a quarter-century.
So they're very important to the way the global economy works.
We have been hearing concern about that.
You don't see anything in the numbers.
And maybe you wouldn't expect to yet.
But you don't see -- we don't see, detect any slower growth or lower investment or lower
hiring or any -- any of the effects that might flow from more uncertainty on the part of
business.
JUDY WOODRUFF: What keeps you awake at night, if anything, when it comes to this economy
and the world economy?
JEROME POWELL: Basically, everything.
(LAUGHTER)
JEROME POWELL: Nobody -- nobody wants a central banker who sleeps well, right?
(LAUGHTER)
JEROME POWELL: What good is that?
(APPLAUSE)
JEROME POWELL: You know, I think -- we -- if we get -- getting monetary policy right, the
question you started with, is so important for the public.
And so we -- all of us who work at the Fed think -- this is the thing we think about
all the time if we work on monetary policy, is, we have got to get that right, and -- because
the benefits of doing that are very broad for the country.
And there -- it's a world full of risks.
Many things can go wrong.
And I probably lose sleep over different things every night.
JUDY WOODRUFF: Do you worry -- how much do you worry that there could be another financial
crash?
JEROME POWELL: My guess is that the next set of problems we have won't look a lot like
the last set of problems we had.
I think there's -- we don't detect measures of financial stability -- of financial instability
as being elevated at this time.
They're sort of in the moderate range, in our view, the view of our staff, and certainly
in my view.
So it's -- it'll be something else, a cyber-attack or some kind of global event.
Those are the kinds of things.
Or maybe it will surprise us and look exactly like the last one.
But I -- we don't really see -- you don't see the kind of buildup of risks in the financial
markets, or let alone in the banking system, where -- where we see much higher capital
and actually less risk being taken.
JUDY WOODRUFF: Meanwhile, we're in Goldilocks time.
JEROME POWELL: Your words, not mine.
(LAUGHTER)
JUDY WOODRUFF: Chairman Jay Powell, thank you very much.
(APPLAUSE)
JEROME POWELL: Thank you.
For more infomation >> UK accuses Russia of 'reckless' cyber attacks including hacking during 2016 US election - Duration: 5:20. 
For more infomation >> The US Navy Is Planning Up For a Serious Showdown With China in South China Sea - Duration: 3:20. 
For more infomation >> USA Facts for Kids America United States - Duration: 2:55. 
For more infomation >> Trump administration asks top U.S. court to intervene in census suit - Duration: 2:13. 
For more infomation >> U.S. Marshals target violent offenders with "Operation Washout" - Duration: 1:21. 
For more infomation >> U.S. Senate approves legislation to oversee U.S. air traffic, drones - Duration: 4:09. 
For more infomation >> Kellyanne Conway's message to red-state Democratic Senators - Duration: 10:42. 
For more infomation >> Alyssa Milano: Sexual Abuse Has Been Institutionalized In The U.S. | Velshi & Ruhle | MSNBC - Duration: 5:08. 
For more infomation >> Watch Now: Secretary of State Mike Pompeo holds press conference, live stream - Duration: 25:29. 
Không có nhận xét nào:
Đăng nhận xét