Diane Swonk
Diane Swonk
falling fed light reason sit soft
The Fed will sit on its hands. There's really no reason to do otherwise. The economy's falling into place as the Fed thought -- it's in a soft spot, with some light at the end of the tunnel.
absorb blows economy fed labor market strong
Like what the Fed has suggested, the U.S. economy was more than strong enough to absorb the blows of Katrina. The labor market is still pretty resilient.
basis fed given good hesitate insurance policy question reason spend
There's no question that, given the right circumstances, the Fed wouldn't hesitate to spend 175 basis points. But they really have to have a good reason to put an insurance policy out there.
catching earnings fed market positive third until willing
The Fed is willing to overshoot the mark. I want to underscore that we're catching up. We're getting the market back in line, but we're not going to see positive earnings from that until we get into the third quarter,
bias fed high move rising risk sooner view
I view the risk as very high that the Fed shifts its bias to tighten (interest rates) sooner than we had forecast. The risk is rising that they will move sooner.
demand fed inflation looking oil policy subtle
They're now looking at the demand trade-off on oil prices, not just the inflation trade-off, which will make Fed policy much more complicated. It's a subtle but important change.
bad economic fed financial july months wants whether
The Fed wants to see whether this July data, this bad economic data, was an aberration, and two months will make it clearer. If they see more instability in financial markets, they will take it lower.
bit coming fed fireworks friday news seen washington
After the fireworks we've seen coming out of Washington on Friday and Monday, I think the Fed would like to be the least bit of news this week.
fed guess move sidelines until
It's my guess the Fed will probably move to the sidelines until at least November,
dealing decisions deficits fed impact permanent trying
The Fed doesn't want to be dealing with the old economy, with deficits returning. They're trying to have some impact on decisions made now without getting us into permanent problems.
deal fed focus limited productive statement trying
A limited statement would be more productive because the Fed is trying to deal with psychological issues. They want the focus to be on their action, not their words.
clearly fed insurance risk saying willing
I think this is clearly the Fed saying 'we're willing to take out an insurance policy, we're not willing to risk recession',
fed walking
It's about the Fed being more communicative with the markets, ... won't just be walking into Greenspan's shoes.
adding certainty chaotic
It's all part of adding certainty in a chaotic situation.