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value | Date int64 1.98k 2.01k | Text stringlengths 2 27.1k | Token_count int64 1 5.57k |
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fomc | 1,998 | The right answer is that I do not know. | 10 |
fomc | 1,998 | That is the wrong answer! [Laughter] | 10 |
fomc | 1,998 | It is the only correct answer that I am able to give. I think the most important point is to be very skeptical about the interbank fixing at 6.8 or 7 rubles to the dollar. It is best to assume that that is a number that someone in the central bank or a couple of banks have decided to post on the screen. I don't know wh... | 85 |
fomc | 1,998 | Is there a measure of volume in the black market? | 11 |
fomc | 1,998 | By definition, we don't know how to measure that. We don't even know whether the black market is experiencing a deep day or a thin day. | 29 |
fomc | 1,998 | Some black markets are blacker than others. | 9 |
fomc | 1,998 | Yes. I'm afraid I cannot help you there, Mr. Chairman. | 14 |
fomc | 1,998 | I don't know either, but my guess would be that the fixing rate is a rate at which people have agreed ex ante to settle certain contracts. Ultimately, it should provide some guidance, but it doesn't necessarily provide any in the short run. The black market rate presumably depends a bit on where you are and who you are... | 260 |
fomc | 1,998 | President Minehan. | 4 |
fomc | 1,998 | This is an easy question. | 6 |
fomc | 1,998 | Good! | 2 |
fomc | 1,998 | What exactly did the Russians do? | 7 |
fomc | 1,998 | That is not an easy question! | 7 |
fomc | 1,998 | They floated their exchange rate. | 6 |
fomc | 1,998 | To a band? | 4 |
fomc | 1,998 | They had a band before, but they were really operating with a heavily guided, narrow interbank band. However, they floated the ruble in a wide enough band that it is trading, at least for the moment, within that band; it is not yet at the lower limit. They announced that they were going to restructure their internal of... | 152 |
fomc | 1,998 | So they excluded foreign official types of debt? | 9 |
fomc | 1,998 | They have excluded foreign official obligations. | 7 |
fomc | 1,998 | What about private-sector debt? | 6 |
fomc | 1,998 | Private-sector debt is subject to a form of temporary capital control. | 13 |
fomc | 1,998 | Just the external private-sector debt--debt to foreign lenders as opposed to debt within the country? | 20 |
fomc | 1,998 | Yes, debt owed to foreign lenders. The trouble is that the linkages are quite high. It is a little odd to read in the wires that Russian banks have borrowed abroad in order to invest in GKOs, which are obligations denominated in rubles. That is not exactly what one normally would think would be the way so-called financ... | 108 |
fomc | 1,998 | Yes, with no laws. | 6 |
fomc | 1,998 | Well, lots of laws, maybe no justice! [Laughter] | 14 |
fomc | 1,998 | Just a small follow-up question, which may be harder. Why? Were they really broke? | 19 |
fomc | 1,998 | I think the answer to that question is "yes." They had lost about $5 billion in reserves, most of it in the last couple of weeks since their program was put in place. It was quite clear that the new program approved by the IMF on July 20 had not stabilized confidence. They were facing an external and internal financial... | 110 |
fomc | 1,998 | So, you think they really did have the $10 billion? | 13 |
fomc | 1,998 | Yes. Their dwindling reserves combined with the momentum in the market last week did not, I think, give them much choice on Monday. Both of their actions are regrettable, as has been amply highlighted. Abandoning the peg means, at least for the moment, that they put in jeopardy the one success they have had on domestic... | 199 |
fomc | 1,998 | President Jordan. | 3 |
fomc | 1,998 | Peter, at the beginning of your remarks you made reference to market concerns about Japan in two ways, deflation and weakness of the yen. This may sound like a continuation of a similar discussion about Japan at the last meeting or some of the previous meetings. What adjustment process do people really think needs to t... | 298 |
fomc | 1,998 | I don't think the world or market participants disagree with your analysis. I believe the dominant view is that the yen will grind lower from its current level. That is the market consensus forecast for exactly the reasons you described. Now, the market has gotten itself into a bit of a loop by becoming persuaded that ... | 292 |
fomc | 1,998 | What about the differential between tradable goods prices in Japan and the average general price level, which is really a crucial difference there relative to the rest of the world? What do the markets think about that resolution? | 42 |
fomc | 1,998 | How is it going to be resolved? | 8 |
fomc | 1,998 | In other words, how do the traders view a continuing weakening in the yen and Japan's ever increasing trade surplus? | 23 |
fomc | 1,998 | I think they recognize a certain tension there. That is true even of those who assert that the best probabilistic forecast of dollar/yen is that it will go through 150 and keep going. If we ask the same people who make that forecast when they plan to start to "bottom fish" and buy cheap Japanese assets, the quick respo... | 123 |
fomc | 1,998 | If their position does not appear altogether logical, it is not. | 13 |
fomc | 1,998 | I appreciate that, Vice Chair. [Laughter] President Hoenig. | 15 |
fomc | 1,998 | Peter, I think you just answered this question, but given the confusion in the market, I will ask it again. When you made your earlier comments, you indicated that the market has suddenly begun to think about deflation though it is uncertain about that prospect. How is that reflecting itself in the market? In other wor... | 82 |
fomc | 1,998 | One thing I alluded to is the continuing demand for bunds and Treasuries, which is indicative of uncertainty. The reason for the uncertainty is that investors do not understand the deflationary world, and the result is a flight of capital. The flight is not motivated so much by a search for quality as it is for certain... | 169 |
fomc | 1,998 | Better than mine! | 4 |
fomc | 1,998 | How do you read the rise in risk spreads in the last three or four months--junk bonds vis-a-vis Treasuries, BAA's versus single A's, that sort of spread? They are not huge by any means, but they sure are consistently higher. | 54 |
fomc | 1,998 | I may be too much of an optimist here, but I think there is a growing appreciation that credit quality may matter some day. | 27 |
fomc | 1,998 | That is also a deflationary indicator. | 9 |
fomc | 1,998 | Absolutely. In a deflationary world, lenders and investors had better start figuring out who is going to remain in business because not everyone is going to make it. | 33 |
fomc | 1,998 | Any further questions for Peter? If not, would somebody move approval of the Desk's operations? | 19 |
fomc | 1,998 | Move approval of the domestic operations, Mr. Chairman. | 11 |
fomc | 1,998 | Thank you. Without objection. We now turn to Messrs. Prell and Truman. | 18 |
fomc | 1,998 | Let me start with a few words about the June trade data that were released this morning. The deficit was $14.2 billion compared with a downward revised $15.5 billion in May. As readers of the footnotes in the Greenbook know, we put down an estimate for the June deficit that was somewhat larger than the one that was imp... | 1,469 |
fomc | 1,998 | Frankly, I'm hard pressed to see where I can add much of value to what you already have heard this morning or read in the Greenbook. Much of the drama during the intermeeting period was on the international side, which Ted has just covered. The domestic development that has attracted the most attention, the decline of ... | 1,358 |
fomc | 1,998 | With regard to the year 2000 problem, I noticed that the Greenbook forecast does not have any acceleration in nonfarm inventory investment for the fourth quarter of 1999. I have no doubt that as we move toward an unknown Y2K phenomenon, just-in-time inventories will get a little disrupted and concerns are going to aris... | 130 |
fomc | 1,998 | We have not anticipated that prospect in our forecast, as our numbers might suggest. The one thing that we have anticipated is a pattern of earlier than usual acquisitions and installations of computer equipment over the next few quarters in an effort to avoid doing a lot of that in late 1999. But I take your point; wh... | 92 |
fomc | 1,998 | That inventory will be up! [Laughter] | 10 |
fomc | 1,998 | Obviously, we will have to confront this question more concretely when we write down year 2000 numbers in our Greenbook forecast for the next meeting. We will do that with some trepidation. I don't recall hearing anything from business firms that suggests they have focused very much attention on this matter thus far. I... | 142 |
fomc | 1,998 | Let me put it this way. The one forecast that I will make unequivocally--with almost the same amount of fervor as Governor Kelley displayed in his forecast of currency inventories--is the media's response to this. From their perspective this is the equivalent of an asteroid hitting the earth at 12:01 a.m on January 1, ... | 214 |
fomc | 1,998 | Obviously, firms that provide goods that their customers might want to add to stocks will have to decide whether to increase production or just let their shelves be depleted and then not have to reverse an increase in production. With the just-in-time production chains, there may have to be some producer responses. | 58 |
fomc | 1,998 | What happens is that business firms that fail to meet the demand of their customers lose market share. Customers are going to build inventories, and the only question is to what extent. If company A does not supply a product, company B will. This is going to be a very interesting forecasting exercise. You did say that ... | 85 |
fomc | 1,998 | We're looking forward to it! [Laughter] | 10 |
fomc | 1,998 | President Parry. | 4 |
fomc | 1,998 | Mr. Chairman, I have two questions. Ted, when I went to Asia in June one of the comments that I heard, particularly in Korea, was that a lot of exporters were facing tremendous difficulties in getting financing to support their businesses. More recently, there have been discussions about a shortage of shipping containe... | 129 |
fomc | 1,998 | I would say a couple of things. I think your sign is probably right. I believe the problems are still there; we still hear these reports. The question is one of magnitude. It is fair to say that our imports have not increased as much as one might have thought as a result of this crisis. But we have to be a little caref... | 308 |
fomc | 1,998 | Thank you. Mike, I thought the staff survey on recent trends in compensation practices produced some interesting results, as did the related discussion of the ECI. One thing that struck me is that variable compensation practices clearly have become much more significant for many firms in different industries. In the pa... | 141 |
fomc | 1,998 | We are engaged in a multifaceted research effort on that issue. In a sense, the work that the Reserve Banks were kind enough to do for us in conducting the survey is a small component of that research. We have been talking to firms, interviewing them in some depth, and we are going to be doing more of that. Our contact... | 383 |
fomc | 1,998 | One factor in thinking about the spending outlook is that it is conceivable that as variable pay becomes more important, profits will become less variable and labor income more variable. That is, when there is a slowdown in the expansion, more of it will show up in the form of a slowdown in labor income than in capital... | 271 |
fomc | 1,998 | There certainly are a lot of studies that suggest that the marginal propensity to consume would be lower if variable incomes were expected to regress to Friedman's original permanent income levels. | 33 |
fomc | 1,998 | Right. | 2 |
fomc | 1,998 | That might be true at least for those people who are not living essentially from hand to mouth. I think a lot of these flexible pay schemes tend to affect people who are in the upper income brackets and have no liquidity constraints. | 45 |
fomc | 1,998 | Thank you. | 3 |
fomc | 1,998 | Payments that are directly related to labor recruitment and paid to outside agencies in one form or another obviously are not included in measures of compensation per hour. But am I correct in assuming that such payments are of an order of magnitude that suggests we should be adjusting compensation per hour to include ... | 72 |
fomc | 1,998 | Maybe not with wage change, but with total labor costs in some way. | 15 |
fomc | 1,998 | I meant compensation. | 4 |
fomc | 1,998 | Theoretically you might want to include those payments as your argument suggests, but I don't think we have any data that quantify them. I suspect that they are not a huge element in the picture. On top of that, we have payments that actually go to employees that are not counted in the ECI. The reason is that they are ... | 87 |
fomc | 1,998 | Shouldn't the value added of personal service or help service groups like Manpower all be directly related to this? | 22 |
fomc | 1,998 | Yes, except to the extent that in a sense they also are substitutes for the internal management of labor resources. | 22 |
fomc | 1,998 | That is true. | 4 |
fomc | 1,998 | If you eliminate a janitorial function and outsource it to another firm, that firm is taking over various fixed administrative-type costs. The analysis gets complicated. | 30 |
fomc | 1,998 | In that sense, there is an argument for including internal costs of employment administration in those data as well. | 21 |
fomc | 1,998 | Obviously this is an incredibly complex matter. As I said, I hope that we are going to make some headway in our effort to discern the effects that some of these changing practices have on the cyclical variability of spending. | 45 |
fomc | 1,998 | President Minehan. | 4 |
fomc | 1,998 | I want to go back to your previous comments about folding in expectations about Y2K problems into the forecasts. In looking through a number of forecasts for this meeting, I noted that DRI seems to be the only one that explicitly deals with the year 2000 problem. However, it does so only in the context of a boom/bust s... | 218 |
fomc | 1,998 | President Jordan. | 3 |
fomc | 1,998 | Thank you. First, on Cathy's point, I would think that even people who believe that there is not going to be a significant problem because of the century date change will find it prudent to stock up before the hoarders get all of the supply. | 52 |
fomc | 1,998 | Only those who read or work on the Internet! | 10 |
fomc | 1,998 | I have a couple of questions that relate to the staff presentations. The first is directed to Ted Truman on imports. I don't know anything about the mechanics of putting the import data together, but it would seem to me that in times like this, unraveling the crosscurrents between volume effects and price effects is ve... | 159 |
fomc | 1,998 | The answer to the first part of your question is that we have aggregate price and aggregate quantity numbers. The aggregate price numbers basically come from the BLS survey of import prices. There are problems with those import prices, and what we do is to take a nominal total and deflate by an index at various levels ... | 617 |
fomc | 1,998 | Thank you. I also have a question about the Greenbook's outlook for the U.S. economy and the emphasis on wealth effects. Following up on your response to Bob Parry, it seems on the surface that there might be some logic and even some indirect empirical evidence in support of these wealth effects. People are behaving in... | 189 |
fomc | 1,998 | I do not think that you need to go that extra step. The stock market is in effect one of the financial market channels through which the impulses that the Committee generates through open market operations create a financial environment that influences the growth of aggregate demand. Exchange rates are another channel.... | 159 |
fomc | 1,998 | That is the reason I asked the question. As I read the Greenbook and I think about the outlook for the balance of this year and next year and the emphasis you put on the wealth effects, I cannot help but think that my comfort level with that forecast depends on what I think about the outlook for the stock market. If th... | 89 |
fomc | 1,998 | If you felt that the market was likely to start to rally again, even against the fundamentals, and to spur aggregate demand in a way that you felt excessive in terms of the inflation prospects that would go with that, I think that would argue at the margin for considering a tightening of policy that you would not other... | 268 |
fomc | 1,998 | Any further questions? If not, who would like to start? President McTeer. | 18 |
fomc | 1,998 | The Eleventh District economy has continued to grow at a healthy but steadily moderating pace. The summer's heat and drought combined with the unending financial and economic troubles in Asia are the two most important factors contributing to the slower expansion of the Texas economy. Unless the weather changes soon, t... | 850 |
fomc | 1,998 | Mr. Chairman, I just want to make clear that while we were praying that we would not be humiliated by incoming information, there was no divine guidance when we drafted the Greenbook. | 38 |
fomc | 1,998 | We never really suspected it! [Laughter] | 10 |
fomc | 1,998 | I did! [Laughter] President Moskow. | 11 |
fomc | 1,998 | Thank you, Mr. Chairman. The Seventh District economy suffered a minor fender bender in June and July. The setback was only temporary, and we are back on the moderate expansion road now that the GM strikes have been settled and recalled employees are working overtime. It will take a few months before the inventory pipe... | 964 |
fomc | 1,998 | President Parry. | 4 |
fomc | 1,998 | Mr. Chairman, the Twelfth District economy expanded at a strong pace during the first half of 1998. Payroll employment grew by 2.9 percent at an annual rate, noticeably above the pace of growth in the rest of the United States. Among District states, growth has been most rapid in Arizona, Nevada, and Washington during ... | 616 |
fomc | 1,998 | President Hoenig. | 4 |
fomc | 1,998 | Thank you, Mr. Chairman. The Tenth District economy continues to do relatively well. Year-over-year employment growth as of June was better than 2 percent, slightly below the national average. Consumers are still buying at a fairly brisk pace. Manufacturing for the most part remains strong, although in some areas, espe... | 396 |
fomc | 1,998 | President Stern. | 3 |
fomc | 1,998 | Thank you, Mr. Chairman. District economic conditions remain positive, but they are perhaps a bit more mixed than they were formerly. I previously have talked a little about the emergence of a two-tiered economy in our District, and the gap between the urban economy and the rural economy appears to be widening. On the ... | 448 |
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