We necessarily operate in an environment in which there's a great deal of uncertainty. In such an environment, it makes sense to use a risk-management approach to identify and avoid the big mistakes. That's one reason I favor a cautious approach.
Are deviations from full employment a social problem? Obviously.
In effect, there has been a significant shortfall in the overall amount of monetary policy stimulus since early 2009.
Nationally, the share of mortgages that are underwater fell by about one-half between 2011 and 2014.
Some degree of inequality in income and wealth, of course, would occur even with completely equal opportunity because variations in effort, skill, and luck will produce variations in outcomes.
It slightly worries me that when people find a problem, they rush to judgment of what to do.
We have put in place policies through supervision and regulation that has greatly enhanced the safety and soundness of the banking system.
Paying interest on reserve balances enables the Fed to break the strong link between the quantity of reserves and the level of the federal funds rate and, in turn, allows the Federal Reserve to control short-term interest rates when reserves are plentiful.
Household spending growth has been particularly solid in 2015, with purchases of new motor vehicles especially strong. Job growth has bolstered household income, and lower energy prices have left consumers with more to spend on other goods and services.
Our objective in regulation should be to put in place tough enough regulation and capital and liquidity standards that we level the playing field and make it costly.
Social safety-net spending is an important form of public funding that helps offset disparities in family resources for children.
The financial sector is vital to the economy. A well-functioning financial sector promotes job creation, innovation, and inclusive economic growth.
To me, a wise and humane policy is occasionally to let inflation rise even when inflation is running above target.
In 1977, when I started my first job at the Federal Reserve Board as a staff economist in the Division of International Finance, it was an article of faith in central banking that secrecy about monetary policy decisions was the best policy: Central banks, as a rule, did not discuss these decisions, let alone their future policy intentions.
Beyond monetary policy, fiscal policy has traditionally played an important role in dealing with severe economic downturns.
Expanded credit access has helped households maintain living standards when suffering job loss, illness, or other unexpected contingencies.
Uncertainty about sales impedes business planning and could harm capital formation just as much as uncertainty about inflation can create uncertainty about relative prices and harm business planning.
A clear lesson of history is that a 'sine qua non' for sustained economic recovery following a financial crisis is a thoroughgoing repair of the financial system.
A wide range of possible fiscal policy tools and approaches could enhance the cyclical stability of the economy. For example, steps could be taken to increase the effectiveness of the automatic stabilizers, and some economists have proposed that greater fiscal support could be usefully provided to state and local governments during recessions.
Food and energy account for a significant portion of household budgets, so the Federal Reserve's inflation objective is defined in terms of the overall change in consumer prices.
Access to capital is important for all firms, but it's particularly vital for startups and young firms, which often lack a sufficient stream of earnings to increase employment and internally finance capital spending.
For decades, the pace of technological change in manufacturing has outstripped that in the economy as a whole. And, so, firms - manufacturing firms - have found it easier to continue producing by - with - reducing their workforces.
My bottom line is that monetary policy should react to rising prices for houses or other assets only insofar as they affect the central bank's goal variables - output, employment, and inflation.
Housing is a relatively small sector of the economy, and its decline should be self-correcting.
Financial market participants appear to recognize the FOMC's data-dependent approach because incoming data surprises typically induce changes in market expectations about the likely future path of policy, resulting in movements in bond yields that act to buffer the economy from shocks.
Increased business sales would almost certainly raise the productive capacity of the economy by encouraging additional capital spending, especially if accompanied by reduced uncertainty about future prospects.
My parents were born in 1906 and 1907. I think the experience of the Depression greatly influenced the way they thought about the world.
Academia is very flexible, but I had a spouse who was very committed to being a completely full partner in our marriage. I think if you counted up how many hours each one of us logged in, he certainly gets more than 50%.
I felt that the Fed had always been the agency that picked up the pieces when there was a financial crisis, and it was invented to do exactly that.
I've been collecting rocks since I was 8 and have over 200 different specimens.
Stronger productivity growth would tend to raise the average level of interest rates and, therefore, would provide the Federal Reserve with greater scope to ease monetary policy in the event of a recession.
Because food and energy prices are volatile, it is often helpful to look at inflation excluding those two categories - known as core inflation - which is typically a better indicator of future overall inflation than recent readings of headline inflation.
A U.K. vote to exit the European Union could have significant economic repercussions.
The financial crisis and the Great Recession demonstrated, in a dramatic and unmistakable manner, how extraordinarily vulnerable are the large share of American families with very few assets to fall back on. We have come far from the worst moments of the crisis, and the economy continues to improve.
Models used to describe and predict inflation commonly distinguish between changes in food and energy prices - which enter into total inflation - and movements in the prices of other goods and services - that is, core inflation.
In the five years since the end of the Great Recession, the economy has made considerable progress in recovering from the largest and most sustained loss of employment in the United States since the Great Depression.
The extent of and continuing increase in inequality in the United States greatly concern me.
At the federal level, the fiscal stimulus of 2008 and 2009 supported economic output, but the effects of that stimulus faded; by 2011, federal fiscal policy actions became a drag on output growth when the recovery was still weak.
In government institutions and in teaching, you need to inspire confidence. To achieve credibility, you have to very clearly explain what you are doing and why. The same principles apply to businesses.
Yankee Stadium is a natural venue for another lesson: You won't succeed all the time. Even Ruth, Gehrig, and DiMaggio failed most of time when they stepped to the plate. Finding the right path in life, more often than not, involves some missteps.
Efforts to promote financial stability through adjustments in interest rates would increase the volatility of inflation and employment. As a result, I believe a macro-prudential approach to supervision and regulation needs to play the primary role.
By putting downward pressure on interest rates, the Fed is trying to make financial conditions more accommodative - supporting asset values and lower borrowing costs for households and businesses and thus encouraging the spending that spurs job creation and a stronger recovery.
I want to be completely clear that I strongly oppose 'Audit the Fed.'
When you're unemployed for six months or a year, it is hard to qualify for a lease, so even the option of relocating to find a job is often off the table.
When I was very young, my father had an accident. He fell down a flight of stairs, fractured his skull, and lost sight in one eye.
New policy tools, which helped the Federal Reserve respond to the financial crisis and Great Recession, are likely to remain useful in dealing with future downturns.
We will watch very carefully what is happening in the economy and adjust policies appropriate.
Sometimes you have to make decisions without knowing all that you would like to know That's part of the job.
It's pretty rare to just talk to people who are having a tough time in the economy, to hear their individual stories.
