Feds Kaplan speaks on Bloomberg TV

Feds Kaplan
  • Says that the disappointing payroll report from Friday May reflect supply issues
  • Kaplan says that enhanced jobs benefits and lack of child care impacted job gains
  • Demand from business to hire is greater than the numbers reflected by the April jobs report
  • Still expect job growth to be strong in 2021
  • if you got strong demand, there are limitations to monetary policy in increasing supply
  • need to make up substantial further progress before taper
  • As we approach "substantial further progress", it will be healthy to start talking taper sooner rather than later
  • Would be good to discuss efficacy the bond buying versus side effects/ the unintended consequences

Kaplan is the president of the Dallas Fed. He has been one of the more bearish Fed Presidents. Although he still advocates for talking about tapered sooner rather than later, but he did seem a less hawkish this week (need to make up substantial further progress before taper),
after the weaker jobs report.