"Inflation is essentially a measure of how fast nominal wages are rising."
This quote by Jerome Powell, Chairman of the Federal Reserve, suggests that inflation can be understood as a rate of increase in the general level of prices for goods and services, and it's closely tied to wage growth (nominal wages). In simple terms, when nominal wages rise faster or slower than the overall cost of living, it influences the rate of inflation. A higher rate of wage growth relative to price increases might indicate a lower inflation rate, while the opposite could result in increased inflation.
"We're not trying to boost the economy. We're trying to get inflation back to 2% on a sustained basis."
This quote indicates that Federal Reserve Chair Jerome Powell is focusing on maintaining a steady, moderate rate of inflation (specifically 2%) in the U.S. economy over the long term. By doing so, he aims to ensure economic stability and predictability for businesses and households, which fosters sustainable growth and prevents deflation or hyperinflation. The phrase "We're not trying to boost the economy" suggests that the Fed prioritizes inflation control over short-term economic stimulus measures, with a focus on long-term stability rather than temporary growth spikes.
"Interest rates are still quite low by historical standards, and they remain just below the broad range of estimates of their longer-run normal level."
This quote by Jerome Powell suggests that interest rates, as of the time he made this statement, were lower than average historical levels, but not significantly so. He implies that these rates are close to the estimated "normal" or long-term equilibrium level. In practical terms, it means borrowing money is still relatively inexpensive compared to past periods, although it's not cheap when considering longer-term trends. This can stimulate economic growth and spending by making loans more attractive. However, maintaining low interest rates for an extended period may lead to inflationary pressures if economic conditions change unexpectedly.
"The Fed doesn't have a specific inflation target; our dual mandate is price stability and maximum employment."
This quote by Jerome Powell, Chair of the Federal Reserve, indicates that the primary objectives of the U.S. central bank are maintaining price stability (low, stable inflation) and maximizing employment. In other words, the Fed's role is to ensure that the economy grows steadily, without excessive price increases or high unemployment rates. This approach aims to foster economic prosperity and maintain overall financial system stability in the United States.
"We will continue to make progress toward our max employment and price stability goals, and we look forward to the time when we can begin to reduce the size of our balance sheet and raise interest rates."
This quote by Jerome Powell, Chairman of the Federal Reserve, implies that the U.S. economy is making progress towards achieving two primary objectives: full employment (max employment) and price stability. Price stability usually refers to a low and stable inflation rate. The Fed aims to balance these goals; maintaining low unemployment without causing excessive inflation. The second part of the quote suggests the Fed's anticipation of a future stage when they can start reducing their monetary stimulus (balance sheet reduction) and raising interest rates, which are typically employed to control inflation and slow down economic growth. This move is a sign of confidence in the economy's resilience and strength.
With customers' permission, fintech firms have increasingly turned to data aggregators to 'screen scrape' information from financial accounts. In such cases, data aggregators collect and store online banking logins and passwords provided by the bank's customers and use them to log directly into the customer's banking account.
- Jerome Powell
By fostering the economic health and vitality of local communities throughout the country, community banks play a central role in our national economy. One important aspect of that role is to serve as a primary source of credit for the small businesses that are responsible for creating a substantial proportion of all new jobs.
- Jerome Powell
It is worth noting that 'too big to fail' is not simply about size. A big institution is 'too big' when there is an expectation that government will do whatever it takes to rescue that institution from failure, thus bestowing an effective risk premium subsidy. Reforms to end 'too big to fail' must address the causes of this expectation.
- Jerome Powell
The Federal Reserve and other central banks have adopted broad public policy objectives to guide the development and oversight of the payments system. At the Fed, we have identified efficiency and safety as our most fundamental objectives, as set forth in our Policy on Payment System Risk.
- Jerome Powell
Higher capital requirements increase bank costs, and at least some of those costs will be passed along to bank customers and shareholders. But in the longer term, stronger prudential requirements for large banking firms will produce more sustainable credit availability and economic growth.
- Jerome Powell
Long-term economic growth depends mainly on nonmonetary factors such as population growth and workforce participation, the skills and aptitudes of our workforce, the tools at their disposal, and the pace of technological advance. Fiscal and regulatory policies can have important effects on these factors.
- Jerome Powell
If investors avoid the Treasury market, we could be unable to pay off maturing securities, which would mean an immediate default. Market participants generally agree that even a brief default would create potentially catastrophic risks to the financial system, like the meltdown of 2008.
- Jerome Powell
Regulatory changes have forced banks to closely examine their liquidity planning and to internalize the costs of liquidity provision. The costs of committed liquidity facilities will be passed on to clearing members. These costs are perhaps highest in clearing Treasury securities, where liquidity needs can be especially large.
- Jerome Powell
If you're searching for quotes on a different topic, feel free to browse our Topics page or explore a diverse collection of quotes from various Authors to find inspiration.