Former Fed Official Stern on Fed Communication

The transcript discusses the Federal Reserve's communication strategy and the diminishing returns of its current approach. It suggests narrowing the number of speakers to improve clarity. The Fed's mandate of high employment and price stability is considered achieved, and the focus is on maintaining this with appropriate interest rates. The discussion also covers the FOMC's communication discipline and the potential modest impact of gradual interest rate increases on economic growth.

What is one of the main issues with the current communication strategy of the Federal Reserve?

• The communication is too technical for the public.

• There is a lack of transparency in communication.

• Too few people are speaking on policy matters.

• Too many people are speaking, leading to unclear messages.

What has the Federal Reserve achieved according to the second section?

• High employment and price stability

• Low inflation and high interest rates

• Stable currency and balanced budget

• Economic growth and low unemployment

What is the consensus regarding interest rates according to the second section?

• Interest rates should remain the same.

• Interest rates should decrease.

• Interest rates should increase.

• Interest rates should be abolished.

How would a modest and gradual increase in interest rates likely affect economic growth?

• It would lead to hyperinflation.

• It would significantly boost economic growth.

• It would cause a recession.

• It would have a minimal impact on economic growth.

Why does the speaker believe the economy is on firm footing?

• Because of significant employment gains in recent years

• Because of a decrease in global trade

• Due to recent technological advancements

• Due to a reduction in government spending