Chicago Fed Pres. Charlie Evans speaking
Chicago Fed Pres. Charlie Evans speaking in a virtual webinar. Evans is not a voting member on the FOMC this year
- What has surprised him the most is that the US has been able to return to about 90% of precrisis economy
- He is surprise that even as Covid 19 death toll rises, he has marked up his growth forecast
- Expects unemployment rates to fall to 7% to 7.5% by the end of the year
- Says inflaiton will continue to be a challenge. Will underrun 2% for a number of years
- Every week and month without renewing fiscal support risks a longer period of slow growth if not outright recessionary dynamics
- His outlook is premised on at least $500 Billion perhaps $1T of additional support
- A bigger overshoot on 2% inflation means you would get an average of 2% inflation more quickly
- Would need to have more Fed committee discussion about asset purchases
- QE is even more complicated now then back in 2012 in rates were higher
- Fed has more to discuss in terms of further QE
- when real interest rates are low, asset prices move up
- support for state, local governments is very important
