Atlanta Fed President Dennis Lockhart spoke to CNBC this morning about future Fed actions and quantitative easing.
- 0:50 I’m for QE and I think the positives outweigh the risks.
- 1:15 We’ll see improvement in final demand and business investment as a result of QE 2.
- 1:50 Things have slowed down in H2 2010, but we’re likely to see an improvement in Q4 of 2010, and gradual improvement into 2011.
- 2:35 More concerned about further disinflation and the possibility of deflation than a “stall speed” in the U.S. economy that may indicate limited job growth.
- 3:30 The exchange markets are expecting more QE and lower yields…
- 4:00 Treasury department takes responsibility for the dollar, the Fed is only looking at the health of the domestic economy. Unwilling to admit, or suggest, the Fed is engaging in activity the Treasury is against.
- 5:40 People who are dependent on interest based income are getting hit right now; but we’re trying to manage the health of the economy for everyone right now, not just someone on a fixed income.
- 6:45 QE needs to be big enough to achieve attention, it can’t be too small.
- 8:00 All we care about is the domestic economy, the Treasury has to deal with the dollar. It is not one of the more prominent things.
- 9:40 It is still a long way to go for the recovery, and housing is a key part of that. But there is not broad improvement.
- 10:45 sceptical bringing mortgage rates down create a rush to buy houses.
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