- US economic performance continues to be impaired by lingering effects of the financial crisis
- Unemployment is likely to remain high for some time, inflation too low (and just when we were getting all bullish about Fridays data, spoil sport)
- Long-term securities buys “actually quite similar”to the Fed’s traditional monetary policy approach
- Objective of treasury buys is to reduce long-term interest rates, spur growth
- Fed policy should provide support for sustained expansion of global economy
- Fed has commitment, tools for eventual removal of extraordinary accomodation
- If current fiscal policy settings are maintained, US budget will be on an unsustainable path
- Premature fiscal tightening could retard already tepid economic recovery
- US needs credible plan to bring down deficits while addressing economy’s short-term needs
Well that was a bit gloomy. Won’t exactly help the new improved mood.
