Source stringclasses 1
value | Date int64 1.98k 2.01k | Text stringlengths 2 27.1k | Token_count int64 1 5.57k |
|---|---|---|---|
fomc | 2,003 | 1 Thank you, Mr. Chairman. I'll be referring to the charts that are on the table in front of you. During the intermeeting period, fixed income and equity prices were first driven by growing expectations of a strong pickup in the global economy in the second half of 2003 and into 2004. Global yields and equity prices bo... | 2,863 |
fomc | 2,003 | On the chart showing the European ten-year government yields, why are the U.K. yields so persistently higher than those on the continent? | 28 |
fomc | 2,003 | I don't know that I can give you a single answer. In part it may be that the general economic performance of the United Kingdom has been better, so real yields are higher. Another possibility is that because there seems to be a 25 to 35 basis point difference-- | 55 |
fomc | 2,003 | It's a remarkably stable spread. | 6 |
fomc | 2,003 | Yes, and the fact that the United Kingdom has a 21/2 percent inflation target whereas the ECB has a target of 2 percent or less may also account for the difference in yields. | 39 |
fomc | 2,003 | I doubt it. | 4 |
fomc | 2,003 | I'm offering various explanations; you may think of them as a menu from which you can pick the ones you like. | 23 |
fomc | 2,003 | May I have a choice? The United Kingdom is running a current account deficit. As the U.K. economy has outperformed the Continent, it has come to be a bit like the United States in worrying about its external situation and its external deficit. If a risk premium is built into the market for the possibility that the exch... | 83 |
fomc | 2,003 | It can't be the heavy mortgage borrowing because that's all floating, as I recall. | 16 |
fomc | 2,003 | Right. | 2 |
fomc | 2,003 | I like Karen's explanation better than yours. Yours may be true, but I don't-- | 18 |
fomc | 2,003 | I'm happy to have assistance where I can get it! | 11 |
fomc | 2,003 | Further questions? Yes. | 5 |
fomc | 2,003 | I have a question about your comments on borrowing at the window during the blackout and the one institution that didn't want to come to the window. Do you have a sense that we learned anything in terms of communicating to banks about the window? Are you comfortable that our system worked as planned? | 57 |
fomc | 2,003 | I'm pretty comfortable with the way it worked. I'm comfortable given that on Thursday--and for that matter on Friday--we didn't have a spike beyond 2 percent for the most part, again except in the limited instances I cited. And we had a lot of trades that took place at 2 percent or just below 2 percent, so the primary ... | 170 |
fomc | 2,003 | Further questions? If not, would somebody like to move to ratify the domestic open market transactions? | 20 |
fomc | 2,003 | I'll move to ratify the open market transactions. | 10 |
fomc | 2,003 | Without objection, they are approved. Dave Stockton and Karen Johnson, please. | 15 |
fomc | 2,003 | Thank you, Mr. Chairman. The data that we have received since the August Greenbook support our view that an acceleration of activity is under way. A pickup in the second half of this year has been a feature of our forecast since last January. But for the first time we can say that the expected improvement in the econom... | 2,462 |
fomc | 2,003 | Since the Greenbook forecast was completed, we have received additional data about the U.S. external sector--the figures for July nominal trade, August prices for internationally traded goods, and second-quarter balance-of-payments statistics. The nominal trade deficit in July was a bit smaller than we had anticipated,... | 1,182 |
fomc | 2,003 | I notice that consumer spending in the first part of September seems to have sagged from the August levels. We know that motor vehicle sales came off their hyper highs of the latter part of last month; and while the data released this morning on chain store sales are not weak, sales clearly slowed recently. Since we ha... | 115 |
fomc | 2,003 | I think the answer to that is "no" in the sense that, while we could do a numerical calculation, I don't think it would convince anybody that what we were estimating was necessarily the marginal propensity to consume out of those monies. | 47 |
fomc | 2,003 | What would you call the relationship between the tax reductions and spending? | 13 |
fomc | 2,003 | What we've seen, obviously, is a very significant jump in disposable income that, as one would expect, was not matched fully by an increase in consumer spending of the same magnitude in July. But just because the amount spent of that increased disposable income was 50 percent or a bit more, I don't think we'd say that ... | 276 |
fomc | 2,003 | It is true, however, that the big cash flow effect from the tax cut was in July and August and not in September. Is that correct? | 30 |
fomc | 2,003 | The rebate checks were mailed in July and August. | 10 |
fomc | 2,003 | I'm really raising the question of whether the weakening in sales in September is a coincidence or possibly a reflection of that phenomenon. | 24 |
fomc | 2,003 | I think that would be something to monitor. The chain stores sales have softened a little, but the indicator content of those sales is not huge. You're right that motor vehicle sales through the first ten days of the month appear to have dropped back from the August pace, but they're stronger than the estimate we had w... | 78 |
fomc | 2,003 | We were getting sales at a 17.2 million annual rate in July. That's the total of autos and light trucks. They were 16.3 in the previous couple of months. | 38 |
fomc | 2,003 | Right, and we had penciled in 16.1. So we're taking that recent higher sales pace as potentially a positive innovation to our forecast. | 30 |
fomc | 2,003 | So what you're basically saying is that there has to have been a big increase in personal saving for July, if I can put it that way, and that obscures whatever effect one can pick up from the tax cut? | 44 |
fomc | 2,003 | On the point you're raising about whether or not the effect of the higher cash flow from the tax cuts begins to peter out, I think we're going to have to watch spending carefully to see. As I indicated in my remarks, while we don't really expect any significant strength in the labor markets to occur until next year, we... | 83 |
fomc | 2,003 | Governor Gramlich. | 4 |
fomc | 2,003 | Dave, you said one thing about productivity that puzzled me a little. You were talking about the apparent huge burst in productivity recently. The argument was that there are some incentives to raise productivity, so firms have been doing it. Comparing now with the late '90s, labor was impossible to find--according to ... | 159 |
fomc | 2,003 | There are workers all over the place now. But perhaps in the late 1990s firms were simply spending a lot to increase their capital stocks in order to overcome that labor shortage--investing in computer equipment, networking equipment, and so forth--without fundamentally reorganizing their production processes or the wa... | 203 |
fomc | 2,003 | President Parry. | 4 |
fomc | 2,003 | Dave, the Greenbook projects that the bond rate will fall as markets learn that the economy can grow at above-potential rates without stoking inflationary pressures. As you noted, the estimate of structural productivity growth has been revised up significantly. That, of course, should raise equilibrium real rates. Do y... | 100 |
fomc | 2,003 | It would certainly work to offset that effect. As we look further down the road beyond the Greenbook horizon, we do see the equilibrium real rate rising in part because of the stronger productivity that we're projecting and in part because of the deterioration in the fiscal situation. Over the period of this forecast, ... | 212 |
fomc | 2,003 | Thank you. | 3 |
fomc | 2,003 | President Poole. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. The discrepancy between the market assumption and the Greenbook assumption for the funds rate path is as large as it has been in a long time. So I would like to come back to a point that I've argued before, which is that the Greenbook baseline ought to be conditioned on the market's expectation... | 361 |
fomc | 2,003 | Just to reiterate some of the discussion we've had on that point, I certainly agree with you that my life would be much simpler if I could just pick off that market-based funds rate path and plug it into the forecast. But as I think about what has transpired over the last several years, many times that procedure would ... | 423 |
fomc | 2,003 | I'm certainly not arguing against receiving your best judgment. I'm just saying that I think your best judgment would be better displayed by taking the market assumption as your baseline. Then you could show that the consequences going forward are as you suggested in this case and that's the reason you don't think the ... | 84 |
fomc | 2,003 | You know, these actually are two separate ways of looking at a forecast. Incidentally, my recollection is that in 1994 or 1995 the forward funds rate was extremely high--well above 6 percent--so that would have been an even more important differentiating factor then. There is no doubt that using the approach President ... | 317 |
fomc | 2,003 | I'd just note that I'd be happy to solicit the views of the Committee on this point. We're trying to produce a product that will be helpful to your discussions. That's the object of the Greenbook. We like to be right, but what we are really looking for is to have some value added in terms of the quality of your policy ... | 106 |
fomc | 2,003 | Historically, the usual issue was whether the staff should make a forecast with an unchanged funds rate, giving the Committee the evaluation of what would happen if we didn't change anything. So I think this procedure of doing several separate simulations probably is the only way out. I've noticed that nobody has raise... | 131 |
fomc | 2,003 | There would be a way, in principle at least, of getting some evidence on this. I don't know how far back in the past we could look at the Greenbook assumption for the funds rate and compare it systematically with the contemporaneous market assumption to see which one turned out to be closer to the way things evolved. C... | 150 |
fomc | 2,003 | In some of the work that we did for you a year and a half ago--I will have to dig it out--we looked at that question, and it turned out that the Greenbook assumptions were a little better than the market forecasts. However, we didn't want to draw from that the conclusion that we do better than the markets--first, becau... | 152 |
fomc | 2,003 | President Broaddus. | 5 |
fomc | 2,003 | Dave, an element of this forecast that interests me a lot is that, even though you've revised upward the output gap, you still have some marginal further disinflation going forward. I think I would benefit from a little more understanding of how you arrived at the inflation forecast. I know you look at output gaps and ... | 117 |
fomc | 2,003 | Using the error pattern of past Greenbook forecasts, a 70 percent confidence interval on our inflation forecast for 2004 was roughly plus or minus 1 percentage point. That means that 30 percent of the time the errors will be larger. As I indicated in my remarks, there is a 15 percent chance that we'll get something at ... | 361 |
fomc | 2,003 | Thank you. | 3 |
fomc | 2,003 | President Moskow. | 4 |
fomc | 2,003 | Mr. Chairman, Ned Gramlich asked a good portion of my question, so I'll pass now. | 20 |
fomc | 2,003 | President Minehan. | 4 |
fomc | 2,003 | This is coming at the same questions we've been bouncing around here from a little different angle. Compared with most forecasters, you are still right up there with Genetski.com in terms of your growth expectations, but you have diminishing inflation and less progress on the unemployment side. Clearly, it seems to me ... | 135 |
fomc | 2,003 | I think you're absolutely right that one of the biggest differences between our forecast and the consensus forecast is a more optimistic outlook on aggregate supply. A number of you, in fact, have remarked on how optimistic our forecast is. I really don't view it as all that optimistic because the gap is large and it d... | 214 |
fomc | 2,003 | To anybody who has watched the economy over the last several decades, it's hard to say that the forecast is for 5 percent GDP growth on the one side and an increasing output gap, inflation going down, and a need for accommodative monetary policy on the other side. There's something about it that just doesn't go togethe... | 64 |
fomc | 2,003 | Obviously, the first possibility is that we could be wrong. | 12 |
fomc | 2,003 | The markets could be wrong. | 6 |
fomc | 2,003 | The second possibility is that the markets and maybe the policymakers, too, have to adjust their sights regarding what the economy is going to be capable of doing. You can do that only on the fly. As the Chairman indicated again, to my chagrin, we really can't forecast very well. It's not possible to look very far ahea... | 300 |
fomc | 2,003 | Any further questions for our colleagues? If not, who would like to start the roundtable? President Hoenig. | 23 |
fomc | 2,003 | Thank you, Mr. Chairman. To begin with the region, our Tenth District economy actually has shown further improvement since our last meeting, although District firms remain reluctant to hire strongly or to spend a lot of money on capital. At the same time, manufacturing activity has expanded, retail sales were solid hea... | 903 |
fomc | 2,003 | President Guynn. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. Since the time of our last FOMC meeting, the tone of our District's meetings and much of the recent data have been providing more tangible evidence that economic activity in our region is picking up. This does not reflect an abrupt acceleration but rather the cumulative effects of positive read... | 632 |
fomc | 2,003 | President Santomero. | 5 |
fomc | 2,003 | Thank you, Mr. Chairman. Economic conditions in the Third District have improved slightly in the five weeks since our last meeting. Regional manufacturing output continues to firm. In August our business outlook survey index of general activity advanced sharply to 22.1 percent, up from 8.3 percent in June. In our Septe... | 1,133 |
fomc | 2,003 | President Minehan. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. Ever so gradually, things seem to be turning around in the First District. To be sure, labor markets remain weak, and confidence about current conditions is uneven. But there is a sense that the regional economy may have bottomed out, and forward-looking indicators of both business and consumer... | 1,544 |
fomc | 2,003 | First Vice President Stewart. | 5 |
fomc | 2,003 | Thank you, Mr. Chairman. The Second District seems to be doing at least as well as the nation. Payroll employment has risen modestly in New York and noticeably in New Jersey. Office vacancy rates across the New York metropolitan area have generally leveled off and even declined in some areas, most notably lower Manhatt... | 760 |
fomc | 2,003 | President Parry. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. Economic activity in the Twelfth District appears to have picked up recently, but employment remains flat overall. Our contacts in the manufacturing sector indicate that, although they've been continuing to shed jobs, they're more upbeat about business prospects. Several high-tech producers are... | 740 |
fomc | 2,003 | President Moskow. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. Although our Seventh District contacts remain cautious, many more of them now say that business is improving compared with just five weeks ago. Business spending appears to be firming. Our manufacturing contacts still aren't planning much capacity expansion, but they are reporting a pickup in o... | 793 |
fomc | 2,003 | President Stern. | 3 |
fomc | 2,003 | Thank you, Mr. Chairman. Overall, the data on the District economy and the anecdotes that have come in indicate that, as usual, it is tracking quite closely with the national economy. So the regional economy is improving. Consumer spending is strengthening pretty much across the board, and some auto dealers report that... | 398 |
fomc | 2,003 | President Poole. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. My Wal-Mart contact was at pains to tell me that business isn't as good as it looks; same-store sales seemed better because of weak year-ago data. Wal-Mart had been anticipating a 3 to 5 percent gain in August, and the actual increase was 6.6 percent--so it was a little better. But he indicated... | 1,048 |
fomc | 2,003 | Why don't we break for coffee and come back in 10 to 121/2 minutes. [Laughter] | 23 |
fomc | 2,003 | President Broaddus, please. | 7 |
fomc | 2,003 | Thank you, Mr. Chairman. I want to spend most of my time today on the national economy. I won't say very much about the District because not a lot has changed in our region. Activity appears to be picking up in several sectors such as textiles and apparel. Furniture manufacturers in the southern corridor of the Distric... | 187 |
fomc | 2,003 | In the boating industry! | 5 |
fomc | 2,003 | I was just saying that hurricanes usually destroy things and that the reconstruction, when it takes place, adds to the GDP. | 24 |
fomc | 2,003 | That's right. It probably will reduce the disinflation pressure on our District's economy. With respect to the national economy, to me the most striking feature of the current Greenbook is that, even though the projected path of GDP has been revised up--actually fairly substantially--in accordance with the stronger eco... | 847 |
fomc | 2,003 | President Pianalto. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. As we've been discussing this morning, the staff projection contemplates a very good business environment for the next couple of years. Aggregate demand and real GDP are expected to expand very rapidly, and an amazing 7 million net new jobs are created. The business fixed investment climate imp... | 811 |
fomc | 2,003 | Governor Kohn. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. President Pianalto highlighted the difficulties and problems the economy has encountered in working through the excesses that built up in the late 1990s. In my view we've had some further evidence over the intermeeting period that the economy may finally be working through these adjustments and... | 1,102 |
fomc | 2,003 | Governor Ferguson. | 3 |
fomc | 2,003 | Thank you, Mr. Chairman. The key question at this meeting is whether the incoming data from the real economy, market developments, and ultimately the outlook are sufficiently changed from our last meeting to warrant a change in either our policy or our tactics. I'll discuss each of these in turn but--not to be mysterio... | 1,132 |
fomc | 2,003 | Governor Gramlich. | 4 |
fomc | 2,003 | Thank you, Mr. Chairman. As far as spending demands go, everything looks good. The recovery seems to be proceeding in a healthy and balanced manner. Consumption has continued to be strong; personal saving rates have been fairly steady at around 4 percent; housing is strong--although it will be clipped some by the rise ... | 887 |
fomc | 2,003 | President McTeer. | 5 |
fomc | 2,003 | The economy in the Eleventh District is beginning to show more-widespread signs of improvement. Employment data for June and July were on the weak side, but the anecdotal reports from our Beige Book contacts and from last week's meetings of our board of directors and our Advisory Council on Small Business and Agricultu... | 676 |
fomc | 2,003 | Governor Olson. | 3 |
fomc | 2,003 | I want to mention two additional data points that support much of what we have already talked about. First, from bankers we're getting increasing anecdotal evidence of renewed interest in either expansion or acquisitions but still only a limited number of actual deals. The change from the last meeting is only slight; t... | 366 |
fomc | 2,003 | 2 Governor Bies. | 5 |
fomc | 2,003 | Thank you. Let me start by adding to what Mr. Stockton and several others have said about the forecast in the Greenbook compared with the forecasts in the private sector. As I looked at the components of the forecasts, I focused again on productivity. I must say that the more I talk to business people, the more I reall... | 885 |
fomc | 2,003 | Governor Bernanke. | 4 |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.