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The Fed has no mandate to generate or maintain economic growth. The two areas in which it does have a mandate are price stability and sustainable employment. U
by NovemberWhiskey 4y ago
The Fed has no mandate to generate or maintain economic growth.
The two areas in which it does have a mandate are price stability and sustainable employment. Usually, recessions are accompanied by a loss of jobs, so that's where the Fed would intervene; that isn't happening thus far which is another reason why economists are split over what is really going on in the economy.
- ac29 4y agoEmployment has fallen slightly recently: https://fred.stlouisfed.org/series/CE16OV https://fred.stlouisfed.org/series/CE16OV Not dramatically though, a more charitable view would say that employement levels are fairly flat.
- hn_throwaway_99 4y agoThe unemployment rate is also extremely low by historical standards, even when taking into account the various measures of unemployment. There is also plenty of evidence that businesses are finding it unusually difficult to hire employees. The Fed is probably fine with the unemployment rate rising pretty significantly because they probably don't see the current rate as being sustainable.
- OscarCunningham 4y ago> The Fed has no mandate to generate or maintain economic growth. Correct. And yet they let inflation get this bad, so it seems like they're trying to avoid recessions even though they haven't been told to.
- kube-system 4y agoOr they believed it would be transitory and any action would upset longer term price and employment stability.
- NovemberWhiskey 4y agoYou don't need to guess; you can go read the minutes of prior Fed meetings here: https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm https://www.federalreserve.gov/monetarypolicy/fomccalendars....