{"id":1713,"date":"2020-04-29T15:54:41","date_gmt":"2020-04-29T19:54:41","guid":{"rendered":"https:\/\/naroffeconomics.com\/?p=1713"},"modified":"2020-04-29T15:54:41","modified_gmt":"2020-04-29T19:54:41","slug":"april-2829-20-fomc-meeting","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=1713","title":{"rendered":"April 28,29 \u201820 FOMC Meeting"},"content":{"rendered":"\n

In a Nutshell:<\/strong>  \u201cThe Committee expects to maintain this target\nrange until it is confident that the economy has weathered recent events and is\non track to achieve its maximum employment and price stability goals.\u201d<\/em><\/strong><\/p>\n\n\n\n

Decision:<\/em><\/strong> Fed funds rate target range remains at 0% to 0.25%.\n<\/em><\/p>\n\n\n\n

The\nFederal Reserve, as expected, kept interest rates at the lowest positive level\npossible.  But under the circumstances, the\nlatest FOMC meeting was largely irrelevant. \nWhat the Fed has done and will do on a daily basis is what we need to\nknow about and we heard a lot about those actions during Chair Powell\u2019s first\never remote press conference.  <\/p>\n\n\n\n

The\nFed Chair made one thing clear:  Within\nlegal limits, the Fed will do whatever it can, for how long it needs to.  He reminded everyone that the Fed has\nessentially an unlimited amount of money to buy assets \u2013 and it intends to\nwrite that check.  He made it clear that more\nneeds to be done and the Fed will do what it can.<\/p>\n\n\n\n

But\nit is the lending to businesses issue that is raising the greatest\nconcern.  This is an area the Fed hasn\u2019t\ngotten into before.  The Fed has\nlimitations on the risk it can take and it is expected to lend (indirectly) to\nthose who can repay the loans.  That is\nsomewhat like the old saying that banks lend to those who don\u2019t need it while\nthose who do cannot get loans.  Mr.\nPowell pushed the risk issue back to the Treasury Secretary, who has to make\nthe determination how much the Fed can lose, which it will as it is backing\nloans.  But Mr. Powell seemed unconcerned\nabout the fears that major firms (read Wall Street) will benefit while Main\nStreet, which bears the name of the lending program, will not be helped \u2013 as\nusual.  His point was that he has to get\nfunds out to companies that need it and the potential costs of being too\ncareful far outweigh the gains from doing too much.  <\/p>\n\n\n\n

Finally,\nthe Fed Chair reminded everyone that the Fed can keep rates low and can lend\nmoney, but it cannot give households and businesses grants and it cannot make\nbusinesses and household spend.  He\nindicated that fiscal policy makers need to take the same view that budget\ndeficits be damned, full spending speed ahead. \nAnd this is correct.  The Fed can\ndo only so much.  It needs Congress to keep\ngoing.  But Congress cannot just put\ntogether packages that sound good, but as we have seen already, don\u2019t\nnecessarily accomplish much.  <\/p>\n\n\n\n

 (The\nnext FOMC meeting is June 9,10 2020.)  <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

In a Nutshell:  \u201cThe Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.\u201d Decision: Fed funds rate target range remains at 0% to 0.25%. The Federal Reserve, as expected, kept interest rates at … Continue reading April 28,29 \u201820 FOMC Meeting<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-1713","post","type-post","status-publish","format-standard","hentry","category-economic-indicators"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1713","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1713"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1713\/revisions"}],"predecessor-version":[{"id":1714,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1713\/revisions\/1714"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1713"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1713"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1713"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}