1 00:00:00,120 --> 00:00:03,160 Speaker 1: We're happy to be joined by rapae Albostik, who is 2 00:00:03,200 --> 00:00:06,480 Speaker 1: the president of the Feberal Reserve Bank of Atlanta, which 3 00:00:06,519 --> 00:00:08,880 Speaker 1: if you could see over my shoulders right over there. 4 00:00:09,640 --> 00:00:12,280 Speaker 1: Let me thank you for coming into our offices, however, 5 00:00:12,600 --> 00:00:15,360 Speaker 1: and we thank you for warming it up from yesterday 6 00:00:15,400 --> 00:00:16,200 Speaker 1: I was a little chilly. 7 00:00:16,400 --> 00:00:18,880 Speaker 2: Or the pleasure's mine and welcome to Atlanta. 8 00:00:19,040 --> 00:00:21,400 Speaker 1: You were the first on the FOMC to say the 9 00:00:21,400 --> 00:00:25,040 Speaker 1: economy didn't need any more rate increases. Did the jobs 10 00:00:25,040 --> 00:00:27,080 Speaker 1: report today basically vindicate your view? 11 00:00:27,640 --> 00:00:30,000 Speaker 2: Well, I wouldn't say vindicate. This is a journey and 12 00:00:30,040 --> 00:00:31,560 Speaker 2: we're going to be on this journey for a while. 13 00:00:31,760 --> 00:00:33,520 Speaker 2: What I will say is I'm pleased with the number. 14 00:00:33,760 --> 00:00:36,680 Speaker 2: It came in at a level that is consistent with 15 00:00:36,720 --> 00:00:39,159 Speaker 2: what my outlook has been, and it really tells me 16 00:00:39,240 --> 00:00:41,080 Speaker 2: that our policies are really starting to work through the 17 00:00:41,120 --> 00:00:43,640 Speaker 2: economy in a way that can help us get to 18 00:00:43,680 --> 00:00:47,800 Speaker 2: our two percent target for inflation with minimal pain, is 19 00:00:47,800 --> 00:00:48,599 Speaker 2: what I'm hoping for. 20 00:00:49,120 --> 00:00:53,479 Speaker 1: Well, what drove the decision on Wednesday to leave rates unchanged. 21 00:00:53,520 --> 00:00:56,520 Speaker 1: You came into the meeting with inflation up a little bit. 22 00:00:57,160 --> 00:01:00,480 Speaker 1: The last jobs report was very strong. Consumer spence was 23 00:01:00,640 --> 00:01:04,000 Speaker 1: very strong, and yet everybody decided to go with the 24 00:01:04,040 --> 00:01:08,000 Speaker 1: busting view and hold what was behind the thinking there? 25 00:01:08,160 --> 00:01:10,680 Speaker 2: Well, I'll tell you what was behind my thinking on this. 26 00:01:11,080 --> 00:01:14,399 Speaker 2: You know, in addition to looking at the data, I 27 00:01:14,480 --> 00:01:19,440 Speaker 2: do a lot of on the ground intelligence and. 28 00:01:18,040 --> 00:01:21,319 Speaker 3: A period that was really unusual for me. 29 00:01:22,200 --> 00:01:24,760 Speaker 2: Everybody was saying the same thing, which is that things 30 00:01:24,760 --> 00:01:28,720 Speaker 2: are slowing down. We are seeing the economy start to 31 00:01:29,000 --> 00:01:31,880 Speaker 2: quote normalize as a thing that people have been saying 32 00:01:32,080 --> 00:01:36,640 Speaker 2: relative to this hot pandemic period. When I get unanimity 33 00:01:36,680 --> 00:01:39,280 Speaker 2: in that, that tells me that there's something that's happening 34 00:01:39,319 --> 00:01:42,480 Speaker 2: on the ground that is probably stronger than what I 35 00:01:42,640 --> 00:01:45,479 Speaker 2: might see in the data. And then the data, even 36 00:01:45,520 --> 00:01:47,960 Speaker 2: though they did come in very strong in September, if 37 00:01:47,960 --> 00:01:50,680 Speaker 2: you looked over a longer term trend, it still said 38 00:01:50,680 --> 00:01:54,000 Speaker 2: that the economy was moderating. And those two things together 39 00:01:54,160 --> 00:01:57,320 Speaker 2: made me very comfortable with the notion that we still 40 00:01:57,320 --> 00:02:01,440 Speaker 2: have time to like watch, be patient and be cautious 41 00:02:01,480 --> 00:02:03,960 Speaker 2: and make sure that we understand the trends and don't 42 00:02:04,000 --> 00:02:05,720 Speaker 2: overreact to any single data point. 43 00:02:06,000 --> 00:02:10,320 Speaker 1: Well, barring some exactionist shock, would you say you're basically 44 00:02:10,360 --> 00:02:13,040 Speaker 1: at the peak now that you don't need to raise 45 00:02:13,120 --> 00:02:13,800 Speaker 1: rates anymore. 46 00:02:14,480 --> 00:02:16,359 Speaker 2: So what I would say is this, there are three 47 00:02:16,400 --> 00:02:21,000 Speaker 2: possible outcomes. Either inflation is gonna stall out in this trajectory, 48 00:02:21,160 --> 00:02:23,440 Speaker 2: it's going to continue slow and steady, or it's going 49 00:02:23,520 --> 00:02:25,960 Speaker 2: to go off a cliff. I have all of those 50 00:02:26,800 --> 00:02:30,640 Speaker 2: possibilities in play, and I'm gonna stay on that today. 51 00:02:30,760 --> 00:02:33,119 Speaker 2: My outlook is that we're gonna stay on that slow 52 00:02:33,160 --> 00:02:36,040 Speaker 2: and steady, and if we continue to do that, then 53 00:02:36,120 --> 00:02:38,880 Speaker 2: I think where we are now will be sufficiently restrictive 54 00:02:38,880 --> 00:02:41,079 Speaker 2: to get us to the two percent level for inflation. 55 00:02:41,600 --> 00:02:43,400 Speaker 2: But there's still a lot that's going to happen between 56 00:02:43,440 --> 00:02:45,280 Speaker 2: now and even the next meeting. We're gonna get a 57 00:02:45,320 --> 00:02:47,400 Speaker 2: couple of jobs numbers, We're gonna get a couple of 58 00:02:47,400 --> 00:02:49,880 Speaker 2: readings for inflation, and that'll tell us and give us 59 00:02:49,880 --> 00:02:53,120 Speaker 2: more signals as to what's going on in the economy. 60 00:02:53,520 --> 00:02:55,320 Speaker 1: You mentioned talking to a lot of people in your 61 00:02:55,320 --> 00:02:57,440 Speaker 1: district who we're telling you things are slowing down. Can 62 00:02:57,480 --> 00:03:00,760 Speaker 1: you characterize that, because not long ago the question was 63 00:03:00,800 --> 00:03:03,000 Speaker 1: did the FED go too far? And we're not just slowly, 64 00:03:03,080 --> 00:03:05,840 Speaker 1: We're gonna fall off a cliff. As you mentioned, and 65 00:03:05,919 --> 00:03:08,800 Speaker 1: others are saying the soft landing narrative. Where do the 66 00:03:08,840 --> 00:03:09,800 Speaker 1: business people see it? 67 00:03:10,200 --> 00:03:13,640 Speaker 2: You know, the business people are in an area of 68 00:03:14,480 --> 00:03:18,840 Speaker 2: moderation back to normal. They understand that they've gone through 69 00:03:18,840 --> 00:03:21,480 Speaker 2: a period where they've had sales that are at levels 70 00:03:21,520 --> 00:03:24,959 Speaker 2: that frankly, they didn't expect, and the decline in those 71 00:03:24,960 --> 00:03:27,720 Speaker 2: sales and that activity over time has come in slower 72 00:03:27,760 --> 00:03:31,640 Speaker 2: than they expected, but it is continuing, and that's really 73 00:03:31,680 --> 00:03:34,680 Speaker 2: the dynamic that really governs you know. The thing that 74 00:03:34,880 --> 00:03:36,760 Speaker 2: I think people need to just keep in mind is 75 00:03:36,760 --> 00:03:39,960 Speaker 2: that through this pandemic period, through this high inflationary period, 76 00:03:40,080 --> 00:03:43,680 Speaker 2: we've had exceptional demand. Consumers have been continuing to spend, 77 00:03:44,080 --> 00:03:47,200 Speaker 2: and once that gets back to a normal level, then 78 00:03:47,240 --> 00:03:50,440 Speaker 2: we'll be back in a more normal environment where inflation 79 00:03:50,480 --> 00:03:52,400 Speaker 2: will be at two percent. And so we needed to 80 00:03:52,440 --> 00:03:55,119 Speaker 2: work through that. And another thing that's been quite interesting 81 00:03:55,520 --> 00:03:58,960 Speaker 2: is that supply has really responded as well. We've seen 82 00:03:59,120 --> 00:04:02,000 Speaker 2: labor force participates be much higher, and I think I 83 00:04:02,040 --> 00:04:05,360 Speaker 2: had my outlook for sure, and that's been another moderating 84 00:04:05,360 --> 00:04:08,480 Speaker 2: force to help us get to where we are today. 85 00:04:08,760 --> 00:04:11,520 Speaker 1: There as a lot of questions about long and variable 86 00:04:11,720 --> 00:04:14,640 Speaker 1: lags and maybe they're hitting the economy right now. You 87 00:04:14,680 --> 00:04:17,200 Speaker 1: guys got the Senior Loan Officers survey this week. Is 88 00:04:17,279 --> 00:04:19,080 Speaker 1: credit still tightening the way. 89 00:04:19,000 --> 00:04:19,480 Speaker 3: It has been? 90 00:04:19,960 --> 00:04:22,680 Speaker 2: Credit is definitely tight, and there is still stuff to 91 00:04:22,800 --> 00:04:25,159 Speaker 2: happen there. We know that a lot of corporate bonds, 92 00:04:25,200 --> 00:04:30,279 Speaker 2: for example, they're about to reset, and those resets are 93 00:04:30,320 --> 00:04:32,159 Speaker 2: going to come in at at interest rate levels that 94 00:04:32,200 --> 00:04:35,599 Speaker 2: are two or three percentage points higher than they were previously, 95 00:04:35,880 --> 00:04:38,480 Speaker 2: and that's going to be a drag. I hear the 96 00:04:38,520 --> 00:04:40,720 Speaker 2: same thing in commercial real estate, where there are a 97 00:04:40,800 --> 00:04:43,360 Speaker 2: lot of people who are expecting some of these buildings 98 00:04:43,480 --> 00:04:46,720 Speaker 2: to struggle to hit the valuations that we're projected in 99 00:04:46,760 --> 00:04:50,039 Speaker 2: the previous lower interest rate environment, and that's going to 100 00:04:50,040 --> 00:04:53,279 Speaker 2: be some disruption as well. So there is still stuff 101 00:04:53,320 --> 00:04:55,719 Speaker 2: that's going to come from our policy, but I think 102 00:04:55,720 --> 00:04:58,880 Speaker 2: that ultimately will contribute to us getting ourselves to that 103 00:04:58,960 --> 00:04:59,839 Speaker 2: two percent level. 104 00:05:00,200 --> 00:05:02,560 Speaker 3: And right now is really just let the time pass. 105 00:05:03,120 --> 00:05:06,280 Speaker 2: Let's let the economy work through all of this and 106 00:05:06,320 --> 00:05:07,680 Speaker 2: see where we are at that point. 107 00:05:08,000 --> 00:05:09,599 Speaker 1: Well, you and others at the feed have made the 108 00:05:09,640 --> 00:05:12,600 Speaker 1: case that now that you're higher, you can go longer, 109 00:05:12,800 --> 00:05:15,840 Speaker 1: that you'll leave rates at this elevated level for quite 110 00:05:15,839 --> 00:05:19,040 Speaker 1: some time, you must have modeled out some idea of 111 00:05:19,120 --> 00:05:22,240 Speaker 1: how long it would take at this level to bring 112 00:05:22,279 --> 00:05:23,640 Speaker 1: inflation down to the target. 113 00:05:23,839 --> 00:05:24,839 Speaker 3: So we have a projection. 114 00:05:25,040 --> 00:05:26,719 Speaker 2: Like for me, I would say it's going to be 115 00:05:26,839 --> 00:05:28,320 Speaker 2: in the second half of next year. 116 00:05:28,680 --> 00:05:31,159 Speaker 3: Of course that's still eight months and now ten months 117 00:05:31,200 --> 00:05:31,600 Speaker 3: from now. 118 00:05:31,760 --> 00:05:33,960 Speaker 2: A lot's going to happen, so I don't try to 119 00:05:34,000 --> 00:05:36,360 Speaker 2: get too precise and exactly it's going to be this 120 00:05:36,400 --> 00:05:40,239 Speaker 2: meeting where something happens, but it is still a ways off, 121 00:05:40,279 --> 00:05:44,760 Speaker 2: and we still have a lot to watch and monitor 122 00:05:45,040 --> 00:05:48,560 Speaker 2: as we think about understanding how the economy is evolving. 123 00:05:48,240 --> 00:05:51,680 Speaker 1: And you think the economy will do fine at this 124 00:05:51,800 --> 00:05:53,760 Speaker 1: level of interest rates until. 125 00:05:53,480 --> 00:05:56,599 Speaker 3: That time, So fine, as you know, there's very subjective word. 126 00:05:56,880 --> 00:06:00,839 Speaker 2: I do think we can get to andlation to the 127 00:06:00,960 --> 00:06:05,600 Speaker 2: levels that are close to our target without seeing a recession. 128 00:06:05,640 --> 00:06:07,200 Speaker 3: I do not have a recession. 129 00:06:06,800 --> 00:06:09,960 Speaker 2: In my outlook, but I don't also see us growing 130 00:06:10,040 --> 00:06:14,640 Speaker 2: continuously at five and six percent in the quarterly basis. 131 00:06:14,760 --> 00:06:17,880 Speaker 2: We're going to be in sort of a slow, steady 132 00:06:18,880 --> 00:06:23,000 Speaker 2: growth that's methodical. It won't be exciting a lot of folks, 133 00:06:23,480 --> 00:06:27,679 Speaker 2: but it will be one that sort of doesn't feature 134 00:06:28,080 --> 00:06:30,960 Speaker 2: a lot of additional pain and disruption for American families. 135 00:06:31,400 --> 00:06:33,919 Speaker 1: Charon Powell has talked about growth needing to be either 136 00:06:33,960 --> 00:06:37,800 Speaker 1: below trend or potential depending on the day. We discuss 137 00:06:37,920 --> 00:06:41,400 Speaker 1: that at his news conference. But do you see that 138 00:06:41,520 --> 00:06:45,080 Speaker 1: as necessary that it needs to come down significantly? And 139 00:06:45,160 --> 00:06:48,159 Speaker 1: do you still believe that an employment needs to go 140 00:06:48,440 --> 00:06:51,280 Speaker 1: up significantly in order to bring inflation down? 141 00:06:51,760 --> 00:06:53,080 Speaker 3: So I don't know. 142 00:06:53,480 --> 00:06:56,160 Speaker 2: What I would say is this, there are many states 143 00:06:56,160 --> 00:06:59,520 Speaker 2: of the world where we can get to inflation to 144 00:06:59,560 --> 00:07:04,119 Speaker 2: where we need to be, where we don't see the wholesale. 145 00:07:03,480 --> 00:07:04,600 Speaker 3: And wide spread disruption. 146 00:07:05,320 --> 00:07:09,000 Speaker 2: Part of that is how strong the supply side continues. 147 00:07:09,240 --> 00:07:12,880 Speaker 2: I saw a report today that suggested that the supply 148 00:07:13,000 --> 00:07:15,480 Speaker 2: chain disruptions are fully a thing of the past. We 149 00:07:15,560 --> 00:07:18,840 Speaker 2: might actually be looking for additional supply to be able 150 00:07:18,880 --> 00:07:21,760 Speaker 2: to fill in. If that happens, then you can get 151 00:07:21,800 --> 00:07:25,440 Speaker 2: the strong growth, you can get the minimize unemployment and 152 00:07:25,480 --> 00:07:28,360 Speaker 2: still see the price level follow the rate of the 153 00:07:28,360 --> 00:07:31,120 Speaker 2: price level increase and decline. 154 00:07:31,200 --> 00:07:32,640 Speaker 3: So that's what I'm hoping for. 155 00:07:33,240 --> 00:07:35,720 Speaker 2: But of course I've got to be ready and prepared 156 00:07:36,000 --> 00:07:38,560 Speaker 2: for any kind of eventuality, and we'll just have to 157 00:07:38,600 --> 00:07:39,640 Speaker 2: see how it plays out. 158 00:07:39,800 --> 00:07:39,960 Speaker 3: Well. 159 00:07:40,720 --> 00:07:45,800 Speaker 1: The economy, growth, and especially unemployment have not performed as 160 00:07:45,880 --> 00:07:49,080 Speaker 1: anticipated by the FED going forward. So what is it 161 00:07:49,120 --> 00:07:51,720 Speaker 1: that would get you to change your view of what 162 00:07:51,840 --> 00:07:55,000 Speaker 1: needs to be done? Is it basically just watching inflation 163 00:07:55,160 --> 00:07:57,880 Speaker 1: and whether it comes down or starts to go up again. 164 00:07:58,080 --> 00:07:59,840 Speaker 3: So to me, there are two things. 165 00:08:00,200 --> 00:08:02,760 Speaker 2: I might add a third, But the first is just 166 00:08:02,880 --> 00:08:06,240 Speaker 2: what's happening with the trajectory of inflation. If it continues 167 00:08:06,280 --> 00:08:09,680 Speaker 2: to progress towards our two percent target, to me, that's 168 00:08:09,720 --> 00:08:13,080 Speaker 2: a very positive sign that says, let's let our policies working. 169 00:08:13,120 --> 00:08:16,040 Speaker 2: Let's keep it working. The second thing that I've been 170 00:08:16,080 --> 00:08:19,640 Speaker 2: looking at from the beginning of the pandemic is inflation expectations. 171 00:08:20,000 --> 00:08:22,880 Speaker 2: And if we find that consumers or businesses are really 172 00:08:22,920 --> 00:08:26,080 Speaker 2: starting to feel like that long term level of inflation 173 00:08:26,160 --> 00:08:28,560 Speaker 2: that's going to be the baseline is creeping up. If 174 00:08:28,560 --> 00:08:31,040 Speaker 2: that's their expectation, we've got to act and we've got 175 00:08:31,080 --> 00:08:33,280 Speaker 2: to take that under control. 176 00:08:33,520 --> 00:08:36,480 Speaker 3: But that's not what's happening right now, and the long run. 177 00:08:36,600 --> 00:08:39,720 Speaker 2: Expectations of state of relatively steady throughout the pandemic, and 178 00:08:39,760 --> 00:08:43,400 Speaker 2: the short run the expectations have fallen significantly. The third 179 00:08:43,400 --> 00:08:46,000 Speaker 2: one that I'm looking at also is the wage level, 180 00:08:46,080 --> 00:08:48,760 Speaker 2: and everyone's talking about this. To me, I think that 181 00:08:48,920 --> 00:08:51,840 Speaker 2: is that's been a very welcome development in terms of 182 00:08:51,840 --> 00:08:55,120 Speaker 2: how it's evolved, and that the businesses I talk to 183 00:08:55,160 --> 00:08:57,880 Speaker 2: are saying we are getting to a place where we're. 184 00:08:57,640 --> 00:08:58,840 Speaker 3: Back to our old style. 185 00:08:59,200 --> 00:09:03,080 Speaker 2: That the the ten and fifteen percent increases in wages 186 00:09:03,080 --> 00:09:05,200 Speaker 2: that we've had to do the last couple of years, 187 00:09:05,400 --> 00:09:09,079 Speaker 2: they're not on the table, they're not necessary, and I'm 188 00:09:09,080 --> 00:09:12,240 Speaker 2: starting to hear more and more the increase we're going 189 00:09:12,320 --> 00:09:14,440 Speaker 2: to do this year is very similar to what we 190 00:09:14,440 --> 00:09:17,240 Speaker 2: were doing in twenty eighteen and twenty nineteen, and that's 191 00:09:17,360 --> 00:09:18,360 Speaker 2: very welcome news. 192 00:09:18,559 --> 00:09:22,720 Speaker 1: Well, you said, probably see progress on inflation the second 193 00:09:22,800 --> 00:09:26,400 Speaker 1: half of next year. So at that point, what do 194 00:09:26,440 --> 00:09:29,400 Speaker 1: you do do you start looking at rate cuts? 195 00:09:29,800 --> 00:09:33,880 Speaker 2: Well, I would say I'm hoping an expegancy inflation progress 196 00:09:33,960 --> 00:09:37,640 Speaker 2: throughout until the next year, and then we'd have to 197 00:09:37,800 --> 00:09:40,240 Speaker 2: really start to think about, like, what's our long run 198 00:09:40,360 --> 00:09:43,280 Speaker 2: neutral level. I don't think. I think we're in restrictive 199 00:09:43,360 --> 00:09:46,560 Speaker 2: territory today, and as we get closer and closer to 200 00:09:46,640 --> 00:09:50,880 Speaker 2: our target, we're going to have to think about moderating 201 00:09:51,760 --> 00:09:55,200 Speaker 2: the level of our policy stance, But that's down the road. 202 00:09:55,480 --> 00:09:57,959 Speaker 2: And you know, actually, it's interesting. I talked to a 203 00:09:57,960 --> 00:10:01,000 Speaker 2: lot of business people and they ask, like, how are 204 00:10:01,000 --> 00:10:01,760 Speaker 2: you thinking about this? 205 00:10:01,880 --> 00:10:02,120 Speaker 3: For me? 206 00:10:02,679 --> 00:10:04,920 Speaker 2: If we're restrictive now, we can't wait till we're at 207 00:10:04,960 --> 00:10:07,520 Speaker 2: exactly two percent to start reducing rates. 208 00:10:07,559 --> 00:10:08,600 Speaker 3: It's got to be before that. 209 00:10:09,120 --> 00:10:11,960 Speaker 2: But the dynamic and that precise moment will really depend 210 00:10:12,000 --> 00:10:14,760 Speaker 2: on the context. So I can't say for with any 211 00:10:14,800 --> 00:10:17,800 Speaker 2: degree of certainty exactly when that will happen. But as 212 00:10:17,800 --> 00:10:21,320 Speaker 2: we get closer and closer to that two percent, I 213 00:10:21,360 --> 00:10:23,000 Speaker 2: think that'll be something that I'll have to take on 214 00:10:23,000 --> 00:10:23,720 Speaker 2: board a lot more. 215 00:10:23,920 --> 00:10:26,360 Speaker 1: Well, your background is in housing, and so this raise 216 00:10:26,400 --> 00:10:29,120 Speaker 1: is the question of what happens to housing. People do 217 00:10:29,160 --> 00:10:32,880 Speaker 1: not want to sell a seven percent mortgage at this 218 00:10:33,000 --> 00:10:36,880 Speaker 1: point and take out one and sell their three percent. 219 00:10:36,960 --> 00:10:40,559 Speaker 1: So is housing basically in the dumper now for years 220 00:10:40,559 --> 00:10:41,000 Speaker 1: to come. 221 00:10:41,440 --> 00:10:42,960 Speaker 3: Well, I hope it's not years to come. 222 00:10:43,440 --> 00:10:47,560 Speaker 2: But look, we've had an extraordinary period with incredibly low 223 00:10:47,600 --> 00:10:50,560 Speaker 2: interest rates, and a lot of people are fortunate enough 224 00:10:50,559 --> 00:10:52,839 Speaker 2: to be able to buy homes and get mortgages at 225 00:10:52,880 --> 00:10:56,800 Speaker 2: those low rates. That is our reality, and so there 226 00:10:56,880 --> 00:10:59,160 Speaker 2: is going to be some rebalancing that needs to happen, 227 00:10:59,440 --> 00:11:01,040 Speaker 2: and that will happen and over time. I don't think 228 00:11:01,040 --> 00:11:03,360 Speaker 2: this is all going to happen in a six month period. 229 00:11:04,000 --> 00:11:09,320 Speaker 2: But my objective right now is to get inflation under control. 230 00:11:09,000 --> 00:11:11,280 Speaker 3: So that our policy rates can get back. 231 00:11:11,120 --> 00:11:13,160 Speaker 2: To something that's lower than where it is now, and 232 00:11:13,200 --> 00:11:15,640 Speaker 2: I'm hopeful that mortgage rates will follow that, and then 233 00:11:15,679 --> 00:11:18,920 Speaker 2: we'll be back to a more normal housing market where 234 00:11:19,080 --> 00:11:22,439 Speaker 2: people will transact and move and buy and sell as 235 00:11:22,480 --> 00:11:24,160 Speaker 2: their life circumstance determines. 236 00:11:24,360 --> 00:11:27,240 Speaker 1: Well. Then a last question, when you get back to 237 00:11:27,320 --> 00:11:30,920 Speaker 1: whatever normal is, should people expect it to be higher 238 00:11:31,120 --> 00:11:34,800 Speaker 1: than in the last ten twelve years. A higher interest rate, 239 00:11:35,000 --> 00:11:39,040 Speaker 1: perhaps a little bit higher inflation rate, maybe growth, a 240 00:11:39,040 --> 00:11:40,560 Speaker 1: potential growth a little bit higher. 241 00:11:40,760 --> 00:11:43,160 Speaker 2: Well, I would expect, yes, higher than the last ten 242 00:11:43,240 --> 00:11:45,880 Speaker 2: years we've been basically been at zero zero. I don't 243 00:11:45,920 --> 00:11:48,400 Speaker 2: think is a reasonable long run expectation for where our 244 00:11:48,440 --> 00:11:50,640 Speaker 2: interest rate should be, So it'll be higher than that, 245 00:11:51,520 --> 00:11:55,079 Speaker 2: but I really don't think inflation will be higher than 246 00:11:55,120 --> 00:11:58,440 Speaker 2: our two percent target. We want to get there and 247 00:11:58,480 --> 00:12:00,920 Speaker 2: that'll be the goal, and if we it to that level, 248 00:12:01,360 --> 00:12:04,280 Speaker 2: I think that sets up the US economy for pretty 249 00:12:04,360 --> 00:12:06,480 Speaker 2: solid growth over the next several years. 250 00:12:06,720 --> 00:12:09,640 Speaker 1: All right, Raphael Bustic, thank you very much, President of 251 00:12:10,040 --> 00:12:11,480 Speaker 1: the Atlanta Federal Reserve.