Federal Reserve Chairman (Fed, US Central Bank) Jerome Powell highlighted the pace of changes in the economy, amid the COVID-19 pandemic and its recovery. He spoke briefly about the matter at the conclusion of the virtual event for the federal hearing on Friday 24.
“It’s an economy that’s changing really, really fast, and it’s going to be a lot different,” Powell said. He noted that those with fewer resources are most affected, as in previous crises, and thanked participants for detailing some of these changes in their areas of work.
Listening to the Fed, Jerome Powell did not comment on monetary policy. In his speech, he underlined the importance of these events so that the leaders can hear directly the economic agents on the effects of the current situation on their company. 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 age,” he commented.
Powell noted that some of the problems encountered are common to all industries, while others are specific to particular areas. He noted changes in the workplace, from safety protocols to covid-19 to fundamental changes in how industries operate, from food to film. He noted that “the company’s plans have been rethought, the outlook has been revised and the future is still shrouded in uncertainty.”
The Fed chairman said uncertainty “often leads to business stagnation, but can also be synonymous with opportunity.” He pointed to creativity and adaptability over the past 18 months as recent positive factors, especially in small businesses, to “meet the demands of a new reality”.
Cleveland Federal Reserve Chairman Loretta Meester said on Friday that federal asset purchases were no longer working the way they used to. According to her, the Fed is already able to slow down 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 need to be careful.
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