Federal Reserve Chairman (Fed, US central bank), Jerome Powell, highlighted the pace of changes in the economy, in the context of the COVID-19 pandemic and its recovery. He spoke briefly on the topic at the conclusion of the virtual event for Federal Hearing, Friday, the 24th.
“It’s an economy that’s changing really, really fast, and it’s going to be very different,” Powell said. He noted that people with fewer resources are the most affected, as in previous crises, and thanked the participants for detailing some of these changes in their areas of work.
While listening to the Fed, Jerome Powell did not comment on monetary policy. In his speech, he highlighted the importance of these events so that managers can hear directly from economic agents about the effects of the current situation on their business. He commented that this is particularly interesting in this “difficult” context of the COVID-19 pandemic. “The speed and severity of this decline – and the speed of recovery in many areas – is unprecedented in the modern era,” he commented.
Powell noted that some of the issues encountered are common across sectors, while others are specific to particular areas. He noted changes in the workplace, from security protocols to covid-19 to fundamental changes in the way industries operate, from food to film. He noted that “the company’s plans have been redesigned, the prospects have been revised and the future is still surrounded by uncertainty.”
The Fed chair said that uncertainty “often leads to business stagnation, but it can also mean opportunity.” He highlighted creativity and adaptability over the past 18 months as recent positive factors, especially in small businesses, in order to “meet the demands of a new reality”.
Cleveland Federal Reserve Chair Loretta Meester said Friday that federal asset purchases are no longer working as they once did. According to her, the Fed is already able to slow the pace of purchases. In a speech, Meester said he was in favor of “tapering” – the gradual reduction in asset purchases – to begin in November.
Loretta Meester, speaking at the Ohio Bankers League event, said she doesn’t think bubbles are about to burst in the stock or real estate market, but stressed that we have to be careful.
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