Speaker 1: It is another good day in the jobless world. Two
Speaker 1: hundred and eighteen thousand jobless claims reported last month. Remember
Speaker 1: we had the big job last week. We had the
Speaker 1: big jump the week before up to two twenty four,
Speaker 1: and now we've gone backwards a little bit on that.
Speaker 1: I'm waiting to see the latest revisions to see what
Speaker 1: last week it was two twenty seven. So last week
Speaker 1: was revised up and this week we come way down
Speaker 1: to to eighteen on a continuing basis one million, eight
Speaker 1: hundred and seventy one thousand. That is down from one million,
Speaker 1: eight hundred ninety four thousand, So it does look like
Speaker 1: workers are still on the job, companies are still holding
Speaker 1: onto their employees.
Speaker 2: Yet it's a little bit higher off the back of
Speaker 2: this MIC. So we're up three or four basis points
Speaker 2: on a ten year to four fourteen on a thirty year,
Speaker 2: up three basis points at least at a four thirty five.
Speaker 2: You put this together with jobless claims and together with payrolls,
Speaker 2: together with the ISAM services manufacturing improving, it's pretty decent
Speaker 2: dates over the last couple of weeks.
Speaker 3: If you're looking for cracks, you're not finding it. When
Speaker 3: people say well, just fast forward, look at the real
Speaker 3: time data. Well, here we have the real time data,
Speaker 3: and it's confirming the strength that we saw last Friday
Speaker 3: in the ten year yield, I'm noting really taking a
Speaker 3: leg higher four point one percent rounded up. To me,
Speaker 3: that's what I'm watching longer term. What does that suggest
Speaker 3: about the neutral rate and about long term momentum underneath
Speaker 3: some of the recovery we've seen.
Speaker 2: Dunnas maye because we can have that conversation right now,
Speaker 2: realtime reaction with think Richmond Fed President Tompak and alongside
Speaker 2: Blimpecks Mike McKay president back in good morning, she say.
Speaker 4: Thanks for having me here, and I am having that
Speaker 4: data didn't surprise.
Speaker 2: Well, let's talk about this data. Let's talk about how
Speaker 2: much weight you're putting on it. It's really strong coming
Speaker 2: out of the gate for twenty twenty four. How much
Speaker 2: weight are you putting on this stuff at the moment?
Speaker 4: Well, I think the data has been remarkable, and it's
Speaker 4: been remarkable across the board. Yeah, the fourth quarter GDP
Speaker 4: three point three percent, the jobs numbers last month, and
Speaker 4: I think all of them do talk about an economy
Speaker 4: that's fundamentally healthy. That's a great thing. I am always
Speaker 4: cautious about numbers around the turn of the year. I mean,
Speaker 4: they're big seasonal adjustments. A great example would be the
Speaker 4: jobs numbers last month. The actual jobs were actually down
Speaker 4: two and a half million because a lot of the
Speaker 4: retail folks who were hired for Christmas, you know, then
Speaker 4: got laid off after. But the seasonal adjustments bring it
Speaker 4: up to a positive three hundred and fifty three. So
Speaker 4: that's a pretty big seasonal adjustment. I look hard at it.
Speaker 4: I'm glad to see it coming in. That's the best
Speaker 4: data we have, but I'm not sure I'm going to
Speaker 4: take too much out of any one month.
Speaker 1: Markets are obviously interested in if and when the FED
Speaker 1: is going to cut emphasis on the when, and I
Speaker 1: know you've said we don't have to be in any rush,
Speaker 1: but with the data like this, basically are you telling
Speaker 1: people you know, we're doing fine with rates where they are.
Speaker 4: Well, I have said you don't have to be in
Speaker 4: any particular hurry. You've got a dual mandate with employment
Speaker 4: and inflation. In the employment side of the mandate, I mean,
Speaker 4: it's actually operating at historic levels three point seven percent
Speaker 4: of employment, job gains. We talked about initial claims, job openings.
Speaker 4: It's a very strong labor market still, so gratified to
Speaker 4: see inflation coming down. Hoping it continues to come down.
Speaker 4: I think we've got some time to be patient.
Speaker 1: I know you said you don't have a roadmap for
Speaker 1: rate cuts. Yesterday, Carlisle Group chief executive Harvey Schwartz said
Speaker 1: investors should not be thinking the Fed would cut rates
Speaker 1: five times this year because that would imply something's wrong
Speaker 1: with the economy. I assume you would agree with him.
Speaker 4: Well, it's hard for me to get into the market
Speaker 4: forecast because there's always two elements going on in those forecasts.
Speaker 4: One is rate normalization under a healthy economy and inflation
Speaker 4: coming down. But the other, of course, the economy takes
Speaker 4: a wrong turn and you come down faster, and so
Speaker 4: those things are a weighted average. To me. There is
Speaker 4: certainly a model that you take rates down quickly. That's
Speaker 4: not a model that's good for the economy. That's just
Speaker 4: one of the things that could happen. And then there's
Speaker 4: the model where you toggle rates down as the economy
Speaker 4: comes back into balance.
Speaker 3: Underpinning this is really the mystery of the neutral rate
Speaker 3: sort of this vague, mysterious concept that people throw around.
Speaker 3: Mount Zeiover at Deutsch Bang changed his view recently, saying
Speaker 3: that he thinks the neutral rate, instead of being about
Speaker 3: three percent in the post pandemic reality, might be around
Speaker 3: three and a half percent or even four percent. Does
Speaker 3: that job with your thinking?
Speaker 4: It's certainly conceivable to me that it's come up from
Speaker 4: the estimates that we saw before COVID. The challenge with
Speaker 4: all these neutral rate estimates is the standard deviation's two
Speaker 4: hundred basis points, and so the center of the SEP
Speaker 4: I think in the last meeting was about two and
Speaker 4: a half, So it could be a half, it could
Speaker 4: be four and a half, and so I think you
Speaker 4: have to sort of make your decisions not based on
Speaker 4: trying to hit a theoretical neutral but based on what
Speaker 4: you see in the economy and what you learn about
Speaker 4: how the economy reacts to rates. And that's what I'm
Speaker 4: trying to do.
Speaker 3: I guess as I'm watching some of the data come
Speaker 3: in and I hear from all of these investors they're
Speaker 3: concerned about reaccelerating inflation later in the year, some of
Speaker 3: these comps change. Are you also starting to worry about
Speaker 3: that a little bit more.
Speaker 4: Well, we've already had a lot to worry about in
Speaker 4: today's conversation, so I won't focus on all of the
Speaker 4: worries I have got. I saw the shipping conversation.
Speaker 2: Ear today, at least it's specialized in worried.
Speaker 4: Yeah. No, there's a lot to worry about. Yeah, I mean,
Speaker 4: I think you have to acknowledge how good the inflation
Speaker 4: data has been for the last seven months. I mean,
Speaker 4: last seven months core inflation one point nine percent. That's
Speaker 4: right on target. That's terrific, right, And I'm not rooting
Speaker 4: against inflation, but I'm always you know, trust but verify,
Speaker 4: you know, let's make sure that's really right. And so
Speaker 4: we'll get a few more months. It would be I
Speaker 4: would very much like to see that trend continue and
Speaker 4: you know, broaden, because it's been disproportionately goods deflation that's
Speaker 4: been masking higher than normal prices and rents and shelter.
Speaker 4: So I'd love to see it broaden and maybe well,
Speaker 4: you know, the trend is good and you can't argue
Speaker 4: with that that trend. Let's just see how we go.
Speaker 1: How do you parse inflation these days? Those because yes,
Speaker 1: the PCE is down below three percent. But when you
Speaker 1: look at things like the Cleveland and Dallas trim means,
Speaker 1: the Atlanta Fed Sticky wage index, it all shows basically
Speaker 1: more inflation than your targeted index.
Speaker 4: Well, these numbers will converge over time, right, and so
Speaker 4: what's happening right now in inflation, as I said, is
Speaker 4: you've got a lot of clawback of goods price increases
Speaker 4: that happened during COVID, and so goods deflation, which has
Speaker 4: always been a factor, is even more significant than it
Speaker 4: has been over the last twenty years. Rents and services
Speaker 4: are higher. These trim mean measures look at the center
Speaker 4: of the distribution, and so they're looking at that center
Speaker 4: part which is higher as opposed to the weighted average,
Speaker 4: which is lower. If it broadens, everything will come down.
Speaker 4: If it doesn't, it won't, and we'll just see what happens.
Speaker 1: Well, how do you make a judgment then on when
Speaker 1: you think it'll be appropriate to cut? What are you
Speaker 1: looking for? The phrase I think that Chairman and others
Speaker 1: have used as measurable progress towards the two percent target?
Speaker 1: How would you define that?
Speaker 4: If I could get these kind of numbers sustained and
Speaker 4: even better broadened, that's what I'm looking for, sustained and broadening.
Speaker 2: It was a worry in the news conference, and you
Speaker 2: could sense that with jam and Pal that he wasn't
Speaker 2: comfortable yet. And I wonder if you will not to
Speaker 2: belie there just with this idea that maybe the improvement
Speaker 2: we've seen over the last six months is down to
Speaker 2: so called one off factors. Do you share that concern
Speaker 2: as well?
Speaker 4: Well? Another way to put it is that core inflat,
Speaker 4: I mean, headline inflation for last year was whatever two
Speaker 4: point six percent. There was a three point three percent
Speaker 4: six month period and a one point nine percent six
Speaker 4: month period, So which do you believe the three point
Speaker 4: three or the one point nine So we're rounding now
Speaker 4: over those three point three months. January last year was
Speaker 4: a very inflationary month. So everything is leaning in terms
Speaker 4: of the numbers should be coming down, and I expect
Speaker 4: them to come down over the next few months, but
Speaker 4: let's see if they do.
Speaker 2: It speaks to this risk that maybe we stabilize above
Speaker 2: target on inflation, and Mike, as you know, the worry
Speaker 2: is that we do stabilize above target. And if you've
Speaker 2: started to cut interest rates, you have to start hiking again.
Speaker 2: Is that a concern that you have that if you
Speaker 2: do start to move, you're stuck in that cycle then
Speaker 2: and you have to continue and you can't start hiking again.
Speaker 4: We're always trying to be cautious because you don't really
Speaker 4: want to reverse course. An interesting period to look at
Speaker 4: eighty six. In nineteen eighty six, after the end of
Speaker 4: the Vulgar era, inflation was actually under two percent, and
Speaker 4: the FED, which had tightened significantly, started loosening significantly. In
Speaker 4: eighty seven, inflation basically doubled from where it was in
Speaker 4: eighty six, and the FED started increasing again. So that
Speaker 4: stuff has happened in history, and you're certainly aware of that,
Speaker 4: and to the extent you could avoid it, you'd love
Speaker 4: to avoid.
Speaker 2: It's that way on.
Speaker 4: You as an official.
Speaker 2: Just the experience of Vulcaran cut well.
Speaker 4: A lot of people write about the history of FED tightening.
Speaker 4: Cycles don't end well, and so you know it'd be
Speaker 4: awesome for it to end well. But as you go
Speaker 4: study the past, it's not like you study the past,
Speaker 4: you see lots of great examples that you're just dying
Speaker 4: to duplicate.
Speaker 1: Let me take the other side of the argument, and
Speaker 1: that is that inflation is going to keep coming down,
Speaker 1: but you're not going to move fast enough, and the
Speaker 1: economy is going to slow more than it needed to,
Speaker 1: or even go into recession because the FED waited too long.
Speaker 4: That's the risk you're trying to balance. And like I said,
Speaker 4: I take a lot of signal about just how historically
Speaker 4: strong the labor market continue used to be, including the
Speaker 4: claims numbers we saw this morning, and so you are
Speaker 4: trying to balance the risk to the employment side of
Speaker 4: the mandate versus the risk to the inflation side of
Speaker 4: the mandate. Inflation still elevated, the unemployment side is still
Speaker 4: very strong. I think that's how I met out right now.
Speaker 2: We were in Jackson whole number of months ago. We
Speaker 2: would talking to some of your colleagues about some of
Speaker 2: the anecdotes they were hearing in that district. Remember that conversation, Lisa,
Speaker 2: And the guidance that we were getting from some FED
Speaker 2: officials is that what they're hearing in the district was
Speaker 2: different to what they were seeing in the data. Did
Speaker 2: the anecdotes conflict with the economic data?
Speaker 4: Well, I'll give you some anecdotes. I mean, I was
Speaker 4: in Western Carolina earlier this week just some things that
Speaker 4: might be interesting. One is that I saw great Clips
Speaker 4: had a sale on haircuts for nine to ninety nine,
Speaker 4: and so that's interesting that even some services are coming
Speaker 4: down in price. That would be consistent with the data.
Speaker 4: There's a big paper mill that laid off eleven hundred
Speaker 4: people in a county of seventeen thousand, and a year later,
Speaker 4: unemployment that county's down, not up, because there were so
Speaker 4: many openings for people in manufacturing positions that all of
Speaker 4: the people who were surplused, who didn't retire, you know,
Speaker 4: had jobs. So that's confirmatory of a strong labor market.
Speaker 4: I think the third quarter five percent GDP stuff that
Speaker 4: wasn't what I was hearing either, and I said the
Speaker 4: same thing. But today what I'm hearing is people aren't
Speaker 4: hiring as much, but they're not firing as much either.
Speaker 4: Price centers understand they're on the back end of the
Speaker 4: price curve. It's not over yet, but they're on the
Speaker 4: back end of it. And demand, especially on the consumer side,
Speaker 4: is still healthy.
Speaker 3: Do you trust the data? And I say this because
Speaker 3: some of the headline data people have been saying people
Speaker 3: aren't responding to the surveys to the same degree post
Speaker 3: pandemic as they were pre pandemic. Does that factor in?
Speaker 4: Well, you have to always take data with a grain
Speaker 4: of salt. You also have to accept it's all you've
Speaker 4: got right, and you have to be wary of confirmation bias.
Speaker 4: You know, I like the data when it agrees with
Speaker 4: what I think, and I don't like the data when
Speaker 4: it doesn't. So when the data comes in, I take
Speaker 4: it for what it is and I try to dig
Speaker 4: into it and understand, you know, does it what's behind
Speaker 4: the numbers? Like the seasonal since I was talking earlier,
Speaker 4: But I accept it and then try to test it
Speaker 4: as opposed to rejecting anything that doesn't agree with my
Speaker 4: prior hypothesis.
Speaker 1: I think that great clips offer was for mullets for
Speaker 1: the Super Bowl er, So did you see.
Speaker 4: You're nice to say it wasn't just because of my hairline.
Speaker 4: I've got a cheap offer.
Speaker 1: The hiring that we have seen in recent months that
Speaker 1: do you expect that? First of all, was it a
Speaker 1: surprise to see the December January numbers? And do you
Speaker 1: expect that to continue or are we going to fall
Speaker 1: off dramatically? And what we see unemployments start to go
Speaker 1: up to the four point one percent the SEP calls
Speaker 1: for I.
Speaker 4: Was surprised at how strong the numbers were in December
Speaker 4: and in January. December revised and in January. What I'm
Speaker 4: hearing is not as much hiring, but definitely not as
Speaker 4: much firing. That's that's how I put it. To labor hoarding,
Speaker 4: that's sort of the technical phrase. But especially with frontline people,
Speaker 4: if you have really fought hard over the COVID era
Speaker 4: to bring people in your factory or into your restaurant,
Speaker 4: you're just loath to take the risk of letting them
Speaker 4: go and try to go into that fight again. And
Speaker 4: so on the frontline side, people are being careful. To
Speaker 4: extent that I'm hearing anything on job cuts, it's actually
Speaker 4: the professional side. It's overhead and you're a business. Maybe
Speaker 4: your pricing power isn't going to be what you thought
Speaker 4: it was going to be. You're worried about the risk
Speaker 4: on the operation side to laying off operating people. Well,
Speaker 4: let's take a look at our overhead and dinner. That's
Speaker 4: where you see in some of the jobs announcements you've
Speaker 4: seen recently. I think disproportionately look like overhead as opposed
Speaker 4: to frontline.
Speaker 2: Interesting. Seeing a lot of that this morning. It's wow,
Speaker 2: we've talked about those companies too. It was a moment
Speaker 2: in the news conference last week where Chairman Power was
Speaker 2: asked about the month of March, and it felt like
Speaker 2: that kind of off the cuff. He just got freezing
Speaker 2: cold water and poured it all over March. We're trying
Speaker 2: to work out whether that was Chairman Powe's view or
Speaker 2: if that's the general view of the committee that you
Speaker 2: share as well. But perhaps March is just too soon.
Speaker 4: Well, I don't ever pre judge a meeting, and I
Speaker 4: don't prejudge the March meeting. We'll see where we get.
Speaker 4: But I always think Chairman Pal speaks for the committee.
Speaker 2: He was talking about the sheet too, and that sounded
Speaker 2: much more interesting. If they're not going to cut interest rates,
Speaker 2: maybe they make a decision about QT collectively the committee.
Speaker 2: You can we talk about that. The decision that you've
Speaker 2: got to make, is it independent of the interest rate decision?
Speaker 2: For you, what happens with the balance sheet from here?
Speaker 2: Can you do one and continue with the other.
Speaker 4: Independent of the the reinterest rate decision? Because you're talking
Speaker 4: about normalizing and when is the right time to start
Speaker 4: normalizing rates, and you're talking about normalizing the balance sheet.
Speaker 4: So we're still in the process of doing that. As
Speaker 4: Truman Pal said, well, we'll have a conversation about it,
Speaker 4: and I think it's great that we do that because
Speaker 4: you want to plan what you do. I still haven't
Speaker 4: seen any signals that you know, we're closing in a
Speaker 4: level of ample. You know, you know, at the end
Speaker 4: of the ample reserves regime A just a number that
Speaker 4: keeps hitting me. If you add up the overnight RP
Speaker 4: plus the reserves today, we're still over four trillion. And
Speaker 4: if you look at September twenty nineteen, we were in
Speaker 4: the one point two one point three trillion in reserves
Speaker 4: without an overnight RP and without a standing REPO facility.
Speaker 4: So I think we're a pretty long way from where
Speaker 4: we were then. And you know, times change, we'll see
Speaker 4: where we are. We've got to learn more, but I
Speaker 4: still think we're a long way from where we were.
Speaker 2: At you know where I'm going, because you do hear
Speaker 2: people say that if you start cunning interest rates but
Speaker 2: you're still doing QT, they're sort of running in opposition
Speaker 2: to each other. Do not see it that way, Don't
Speaker 2: Richmond Fed President Tom Barking with us around the table
Speaker 2: this morning together with Bloomberg's Michael McKee. It's fantastically continue
Speaker 2: this conversation. The worries of the banking sector of last
Speaker 2: year different this year. Last year was about working through
Speaker 2: interest rate sharks. Now it's about potentially credit stress. Is
Speaker 2: this coming up on the committee when you saw that
Speaker 2: in NYCB last week the day of the decision. Is
Speaker 2: this something you will talked about together collectively.
Speaker 4: Well, commercial real estate, as the Secretary said, is a
Speaker 4: known issue, and it's an important issue. I was in
Speaker 4: DC yesterday doing a round table with some real estate executives.
Speaker 4: That's a market that struggled to come back, and you
Speaker 4: can feel the stress in the commercial real estate area,
Speaker 4: particularly of course downtown off US. So that's a real
Speaker 4: thing in the banks many banks and non banks have
Speaker 4: exposure to. That's an important thing to take into account
Speaker 4: in terms of stability. But as I say, it's not
Speaker 4: a new kind of risk. I mean, we have had
Speaker 4: real estate shocks before, We've gone through real estate cycles.
Speaker 4: It wouldn't stun me if you know a bank or
Speaker 4: two ended up wrong footed in those things. But the
Speaker 4: system knows that real estate is a you know, asset
Speaker 4: with a certain amount of risk, and I hope, I
Speaker 4: hope and expect that you know, we've got enough capital
Speaker 4: to whether that.
Speaker 3: A lot of people have speculated that the FED would
Speaker 3: cut rates in response to another bank failure. Do you
Speaker 3: think that that's an accurate assessment or do you think
Speaker 3: that that is not the correct channel of response, because
Speaker 3: that's basically the base, it's the market. A lot of
Speaker 3: people are.
Speaker 4: Saying mandates employment and inflation. You've got to take an
Speaker 4: account what you think is going to happen to employment
Speaker 4: and inflation if the economy is to turn south. I mean,
Speaker 4: that's a case for trying to normalize rates faster, but
Speaker 4: the kind of we'd have to turn south as opposed
Speaker 4: to this being some sort of a bank oversight response.
Speaker 1: The Chairman said that this is a man problem commercial
Speaker 1: real estate. But I want to ask you if you
Speaker 1: think that in the context of FED officials, including the
Speaker 1: then chairman, telling us in two thousand and seven, that
Speaker 1: real estate.
Speaker 4: Was not going to collapse. Sorry, And your question is
Speaker 4: do you have a good handle on this?
Speaker 1: Can you be sure that this is something that's manageable well?
Speaker 4: And the banks that we supervise. I mean we're spending
Speaker 4: a lot of time with them and productively going through
Speaker 4: the real estate assets and trying to understand what the
Speaker 4: risks are and what the reserves are against those risks
Speaker 4: and making sure we've got those things appropriately handled. So
Speaker 4: in the scope that we've got, we're working hard on that.
Speaker 4: I think you never know what you don't know, and
Speaker 4: so you know what might happen in the non bank sector,
Speaker 4: don't know. You know what could happen, you know with
Speaker 4: these real estate assets. We'll see. But I think we've
Speaker 4: got our head down with the banks that we oversee
Speaker 4: trying to work through it. Well.
Speaker 1: Does this weigh on your thinking at all about when
Speaker 1: you might want to cut interest rates? The story that
Speaker 1: the real estate people tell is that this problem is
Speaker 1: only going to get worse over time time as companies
Speaker 1: get closer to their refinancing.
Speaker 4: I think it's important to take commercial real estate apart.
Speaker 4: I mean, there are huge parts of commercial real estate
Speaker 4: that are quite healthy. Data centers would be a good example.
Speaker 4: Retail is healthy, the holding part of multi family the
Speaker 4: building has its issues. We're really talking about office in
Speaker 4: a narrower B and C downtown office space. That's where
Speaker 4: the biggest risk is and I'm sure there will be
Speaker 4: losses there already have been and will be losses in
Speaker 4: that space. But as I said, it's a known variable.
Speaker 4: If you go back to our stress test assumptions, you'll
Speaker 4: see pretty significant stress on commercial real estate valuations, and
Speaker 4: you saw the outcomes for the bank.
Speaker 3: So there are a lot of known variables out there,
Speaker 3: which is the reason why we're so worried. And you said,
Speaker 3: there's a lot of worry around this table. We were
Speaker 3: worrying earlier with a bunch of credit people who are
Speaker 3: no longer worried because somehow some of these maturities are
Speaker 3: not an issue. How do you understand the fact that
Speaker 3: people were talking about zombie companies, they were talking about
Speaker 3: zombie real estate. They were talking about how the world
Speaker 3: was going to be turned on its head when the
Speaker 3: Fed raised rates by five five and a half percentage
Speaker 3: points make sense? The fact that that just hasn't happened.
Speaker 4: Is it possible that some of them were wrong. I'm
Speaker 4: just not sure if it's not that. If it's not so,
Speaker 4: here are the numbers that have really spoken to me,
Speaker 4: which is, if you look at the total interest burden
Speaker 4: for individuals and the total interest burden for companies, and
Speaker 4: you divide that total interest burden today by total revenue
Speaker 4: for companies or total personal disposable income for individuals. The
Speaker 4: numbers have finally now in aggregate, just gotten back to
Speaker 4: twenty nineteen levels. And so what does that mean. There
Speaker 4: are a lot of people individuals who refinance their mortgages
Speaker 4: or pay down their credit cards. There are a lot
Speaker 4: of companies that refinance their debt when rates were very low,
Speaker 4: and so they are absolutely companies that are wrong sided,
Speaker 4: wrong footed in this. But in aggregate, this total interest
Speaker 4: burden hasn't yet hit the country in that scope. I
Speaker 4: think that a lot of people are predicted it could.
Speaker 4: I mean, that's a good reason to be cautious on
Speaker 4: the economy. On the other hand, they couldntinued month over
Speaker 4: month health of demand. You know, look at GDP for
Speaker 4: the last half of last year sort of argues against it.
Speaker 4: But that's what you watch.
Speaker 2: We've got about two minutes left, which means we should
Speaker 2: probably talk about something you definitely don't want to talk about,
Speaker 2: which is politics done in Washington. When senators and officials
Speaker 2: in Washington start to write letters to the chairman to
Speaker 2: ease policy. How does the committee respond to that. It's
Speaker 2: a big election year. You talk about live meetings. We're
Speaker 2: wondering how live some of the meetings are going into
Speaker 2: that election. How do you avoid getting into politics?
Speaker 4: Listen. I think the Chairman was brilliant on sixty minutes,
Speaker 4: and if you watched it, he sort of closed with
Speaker 4: a very clear answer to that, which is, we just
Speaker 4: try to do the right thing. And I think his
Speaker 4: phrase was integrity is priceless, and I thought that was
Speaker 4: very well put.
Speaker 3: The Chairman on sixty minutes also talked about the urgency
Speaker 3: of the fiscal health of the country. CBO yesterday debt
Speaker 3: will hit a record high, so much of that is
Speaker 3: for net interest payments. Is that a reason to potentially
Speaker 3: cut rates?
Speaker 4: I assume you'll have other people on and ask the
Speaker 4: question of whether it's to cut debt. I mean, yeah,
Speaker 4: there's two ways you go. I think we're trying to
Speaker 4: becus on inflation and unemployment, and I think having rates
Speaker 4: being restrictive levels is good for the long term. And
Speaker 4: if we can get inflation down to where we want
Speaker 4: to and if employment can stay in the right place,
Speaker 4: rates can normalize that'll reduce that burden. But our objective
Speaker 4: function is not around the country's debt burden. Our objective
Speaker 4: function is around what Congress has asked us to do,
Speaker 4: which is inflation and unemployment.
Speaker 2: So it's going to see you. Thanks for I appreciate
Speaker 2: your time. As always, Richmond Fed President Tom bark in
Speaker 2: there alongside Bloomberg's Michael McKee