AIG’s failure revealed systemic problems in the OTC derivatives market that went well beyond the failure of a single market participant. Jerome Powell Read Quote
The FOMC has considerable control over short-term interest rates. We have much less influence over long-term rates, which are set in the marketplace. Jerome Powell Read Quote
It is quite plausible that the process of increased fragmentation of production across borders is subject to ‘diminishing returns’ and has its natural limits. Jerome Powell Read Quote
Given that trade benefited the Asian economies on the way up, it seems natural that the slowdown in global trade, whatever its causes, could lead to some loss of dynamism and growth in the region. Jerome Powell Read Quote
It is worth noting that ‘too big to fail’ is not simply about size. A big institution is ‘too big’ when there is an expectation that government will do whatever it takes to rescue that institution from failure, thus bestowing an effective risk premium subsidy. Reforms to end ‘too big to fail’ must address the causes of this expectation. Jerome Powell Read Quote
Bailouts may have been more tolerable in the early 1990s when they were rare and their use for a failing bank was uncertain. That is no longer the case. Jerome Powell Read Quote
The longer workers are unemployed, the greater the likelihood that their skills will erode and workers will lose attachment to the labor force, permanently damaging the economy’s dynamism and potential output. Jerome Powell Read Quote
Community banks are a crucial part of our economy and the fabric of our society. Jerome Powell Read Quote
Although I have never worked in a community bank, I have been a customer, and I know from personal experience the special skills that these institutions bring to their customers. Jerome Powell Read Quote
By fostering the economic health and vitality of local communities throughout the country, community banks play a central role in our national economy. One important aspect of that role is to serve as a primary source of credit for the small businesses that are responsible for creating a substantial proportion of all new jobs. Jerome Powell Read Quote
