Federal Reserve Key Words: Patient or Considerable?

The transcript discusses the Federal Reserve's potential changes in policy language, focusing on how Janet Yellen might navigate economic improvements and inflation concerns. It highlights the importance of choosing words that signal future interest rate hikes without alarming markets. The discussion also touches on global issues like Russia's economy and oil prices, which could influence the Fed's decisions. The conversation concludes with a summary of the challenges faced by the Fed in balancing these factors.

What is the main challenge for the Fed when signaling a future interest rate increase?

• Balancing the federal budget

• Increasing inflation rates

• Ensuring the markets are not spooked

• Reducing unemployment

What term did the Greenspan Fed use to describe their approach to policy changes?

• Patient

• Cautious

• Aggressive

• Immediate

What is Janet Yellen's role in the Fed's decision-making process?

• To unilaterally decide interest rates

• To balance competing views and find consensus

• To focus solely on domestic issues

• To prioritize international economic conditions

Which external factor is mentioned as potentially beneficial for U.S. consumers?

• Higher interest rates

• Rising oil prices

• Falling oil prices

• Increased Russian exports

How might the economic situation in Russia influence the Fed's decision?

• It could lead to immediate rate hikes

• It might be ignored due to its limited impact on the U.S.

• It will cause a reduction in U.S. exports

• It will increase U.S. inflation