From MarketWatch
Janet Yellen’s no more confident than the rest of us
Opinion: Central banker is no cheerleader on the economy
By Steve Goldstein, MarketWatch | June 18, 2014
WASHINGTON (MarketWatch) — The U.S. economy has now recovered all the jobs it lost from the Great Recession. Industrial production is now higher. But consumer confidence is, depending on your measure, somewhere between 10% to 25% below its 2007 peak.
It turns out, Federal Reserve Chairwoman Janet Yellen feels pretty much the same way as other Americans.
For example, this is what the world’s most powerful central banker had to say Wednesday when asked if, finally, she’s confident the economy is running above its long-run potential.
“When you say confident, I suppose the answer is no, because there is uncertainty,” she said. Yes, she continued, there’s accommodative policy from her Fed, there’s diminished fiscal drag, easing credit conditions, improving household debt finances, rising home prices, rising equity prices. But she returned to the word “uncertainty,” and it didn’t seem like just perfunctory caution.
Yellen also was asked about why the Fed doesn’t see the jobless rate falling at the same rapid rate (which the Fed has misjudged continuously over the last two years).
“We may see that as the economy picks up steam and we see further recovery in the labor market that those ... let’s call them discouraged workers will return either to unemployment or to employment, and as labor force participation begins to stabilize, the unemployment rate will come down less quickly,” Yellen said.
Cheerleader, she’s not.
Read more from MarketWatch >>
Janet Yellen’s no more confident than the rest of us
Opinion: Central banker is no cheerleader on the economy
By Steve Goldstein, MarketWatch | June 18, 2014
WASHINGTON (MarketWatch) — The U.S. economy has now recovered all the jobs it lost from the Great Recession. Industrial production is now higher. But consumer confidence is, depending on your measure, somewhere between 10% to 25% below its 2007 peak.
It turns out, Federal Reserve Chairwoman Janet Yellen feels pretty much the same way as other Americans.
For example, this is what the world’s most powerful central banker had to say Wednesday when asked if, finally, she’s confident the economy is running above its long-run potential.
“When you say confident, I suppose the answer is no, because there is uncertainty,” she said. Yes, she continued, there’s accommodative policy from her Fed, there’s diminished fiscal drag, easing credit conditions, improving household debt finances, rising home prices, rising equity prices. But she returned to the word “uncertainty,” and it didn’t seem like just perfunctory caution.
Yellen also was asked about why the Fed doesn’t see the jobless rate falling at the same rapid rate (which the Fed has misjudged continuously over the last two years).
“We may see that as the economy picks up steam and we see further recovery in the labor market that those ... let’s call them discouraged workers will return either to unemployment or to employment, and as labor force participation begins to stabilize, the unemployment rate will come down less quickly,” Yellen said.
Cheerleader, she’s not.
Read more from MarketWatch >>
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