YouSaid · the spoken record

Ethan Harris

lines on the record: 105
first: 2016-02-05
most recent: 2016-02-05
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Yeah, and so I, in the book I wrote, The first chapter was about what Greenspan got right, and the second was about what he got wrong. So, which was the bigger chapter?”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, all those predictions about what he's doing. And so you have to put very high marks on him. For Janet Yellen, it's more of a, she's in a less dramatic position. She's making less important judgments. She hasn't been faced with the kind of challenge. But I think that she's doing a good job. I think she was a good choice as a Fed chairman.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not even, yeah. Well, you know, you look at it again, so you have to give high marks to her predecessor because you think about the... The modern history of the US economy, you've got three big events where the central bank had to really intervene. You had the Great Depression where the Fed actually did a poor job and didn't really do its job of keeping a banking system going. Then you had the fighting of inflation by Volcker. A successful war there. And then you had Bernanke come in and say, listen, I'm not going to listen to the critics. I'm going to focus on getting growth in the economy back. I'm not going to listen to people who say I'm creating inflation. Or hyperinflation and the collapse of the dynamic.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's what we have to do to get you back in the reality is we know that we're probably going to be causing a recession here. And so we're, because up to that point, the Fed had done half measures. is a ratcheting process. Inflation go up, the Fed would push it down a little bit, then it would go up some more. And the Fed never really got its arms around the problem. And he came in in an incredibly tough political environment and stuck to the policy and vanquished inflation. And so I think that because he did the right thing at an incredibly difficult time, you have to rank him as one of the top ever.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, Lincoln gets both now. There you go. But it's the ones who go through, and Volcker deserves credit as one of the best Fed chairmen ever because he stepped in at a time where it took a lot of courage for the Fed to basically say, okay, that's it. Inflation's out of control”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Share that. Well, I mean, you know, he's kind of like when you determine which presidents of the United States are the greatest presidents, it's usually the ones that were there during a war, right? It's people like, I always thought it was the tallest one, whoever's tallest.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“What I like about the Fed, in fact, why I worked there at the beginning of my career, is I really believe the leadership of the Fed are technocrats. There are people who have that job because they want to Make the economy better. And I don't think that it's a remarkably non-political institution. And one of the, you know, not only do economists almost all agree that you want, you don't want to go back to the gold standard, but almost every economist would agree you need an independent central bank. You don't want a politician, a political system running your central bank. This is what has gotten countries into serious trouble historically. I'd rather have a Technocrat who might or might not be right on whether they're doing than have somebody with a political agenda running the Fed.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Of the 40 advocate going back to the gold standard, and the vast majority strongly oppose the idea. And the reason is because we go back in time before the Fed existed, yes, we had low inflation, but we had a recession every three years and the financial markets are extremely unstable. So the Fed We need some kind of guiding hand in monetary policy. You could argue about whether the Fed should be more or less aggressive, but the idea of not having a central bank there, I think history suggests strongly it would be a bad idea. I think the critics of the Fed”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, first of all, let's step back and see talk about what economists in general believe. So the University of Chicago has a poll they do periodically of 40 top academic economists. And one of the questions they ask them is whether it would be a good idea to go back to the gold standard, right? Okay. Right? And the answer they get is that they have zero”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so the yield curve right now is pretty steep. And so the yield curve is telling us that the markets are pretty comfortable with the idea the Fed's going to be raising interest rates that 10 years from now we're going to have an interest rate of above 2%. And now it's not saying that they're going to be high interest rates because we're going from zero. But it is a bit of a vote of confidence in that we're not stuck forever at zero. I mean, there are people out there who say the Fed, it's one and done. The Fed can't hike rates. They're never going to get close to the 3%, 4%. We'd hope they would get to. And I think the markets are saying, well, we think we don't think they'll get all the way to that level, but we do think the Fed will be able to hike.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, remember the yield curve is telling you what people is in effect telling you what people expect to happen to interest rates over the, say, if you're comparing one year yields to 10-year, the 10-year yield is higher than the one-year yield, it must mean that investors expect interest rates to go higher. One way to think about it is a rough approximation is the average one-year yield every year for the next 10 years should roughly equal the current 10-year yield. And that way you're getting the same investment return.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and so in the case of when the US went into its subprime mortgage problem, Canadians had learned their lesson from their past housing crises. I don't think we're seeing anything in Canada that compares to what happened in the US at the peak of the crisis, though. I think that Canada... Has things under control there.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you know, so I mean, this is again, I mean, the problem, of course, with, we know that for the financial cycles over time is that, you know, people learn their lesson and they're very cautious and then they kind of over time unlearn the lesson. Sure. Takes 25.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, yeah, right. Yeah. And that's the story of that period. And my feeling in real time is writing about as an economist was that in the early 2000s, I felt okay about the mortgage market. It was getting more aggressive, but it hadn't reached these very extraordinary levels. In 2004, in 2005, you had this very rapid escalation of exotic mortgages with very aggressive features to them. And that's what kind of set a bell off in my own head worrying about the housing market. Of course, I don't think anyone in the business understood the extent.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, to me in the 1990s you had a fairly sensible mortgage lending practice. When I bought my house in the early 90s and we put 20% down and we really had to scrape and scrim to get the money together. And that meant that it would have taken a horrendous housing market for us to be underwater in our house. And so that was a very kind of safe. Mortgage to have in place. But when we went to the more exotic mortgages where almost no money down, lack of adequate income documentation, all that, then we knew we were kind of getting over our skis at that point.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That distressed property becomes a sale and every sale creates new distressed properties by creating oversupply into the market. So it's critical, I think the core lesson to me in terms of regulating the mortgage market is you need down payments. And you need effective income documentation”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and I think that the lesson of all this is what is that we know that in the housing market, it's important that the borrower have skin in the game, that they have a real down payment, and that they have adequate ability to repay the mortgage based on a sensible estimation of their income flow. So those are two of the very basic things that got lost along the way. And that is the key. I mean, if you have the reason the mortgage crisis was so virulent is because you really didn't need to lose that much money in the value of your house before you're underwater because there's almost no down payment, in which case...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that one of the core problems with the way the mortgage market was regulated before the crisis was that there were competitive regulators, right? So if you were... You had state and federal regulators covering different kinds of institutions that were lending into the market. And so it was a bit of a race to the bottom. Whoever was the loosest lender got the business. And so the inability to have a more integrated, clear Ownership of this sector, and who's really regulating, and what are sensible rules, I think was a big part of the problem. And so I think that the Fed shared Blame with every other regulator, not really aggressively addressing what was aggressive lending practices. But it's hard to ascribe blame when you have a system that was so poorly put together to begin with.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think when you look at the causes of the crisis, you have to kind of spread the blame pretty widely. I mean, for one thing, we all know that the regulatory structure of the U.S. financial system was out of date and a leftover patchwork of regulatory agencies and regulations. And so it really needed reform, but there was kind of a lack of political will to do that. We also know that there was pressure from both parties to promote growth in home ownership. To the point where there's kind of a loss of sight of whether really it's appropriate for people with weak credit and low incomes to own real estate. I mean, and so there's a bit of a political push in that direction.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Where do we meet? I think we met at one of these economics get together, but I definitely know you through your personality as a great radio host.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, that's the thing. I don't have a blog out there or anything. I write for Bank of America, Maryland, so if you are a client of the firm in any way, you'd have access to all the stuff that we write. And by the way, I've got a really great team that works for. I am the pretty face. I have a great team.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well developed or structured, and normally global markets pay no attention to the Chinese market for just that reason. It's not really integrated. It's not like the close connections you get between European and US markets where investors, there's a lot of cross-flow of investing and people look at them as mature markets that function effectively. So we really need to, investors need to kind of stop hyperventilating about China.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Eight-tenths of a percent of our GDP to China. The Chinese equity market has been off on its own tangent for the last year and a half. It had a huge zoom up and now a big collapse. We didn't pay any attention when it went up, so why are we care if it's going down? It's kind of on its own little planet.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“They not be anticipated. Well, I would turn that question around a bit. I don't think there's any big upside story actually to tell you the truth going forward. I think that the one thing you can always point to is that you have some pretty impressive new technology going on in the economy. Historically, we've had these cycles where you'll have, say, a 10-year boom in productivity due to a tech breakthrough. The breakthroughs we're having now are pretty impressive. They don't seem to be delivering anything on the economy, but there's always that kind of breakthrough. I think that the way I would phrase it is what the markets need to do is they need to stop hyperventilating about low oil prices and weakness in China, right? Is China really that important to the U.S. economy? I mean, we only sell.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Japanese central bank. Well, I mean, I think we have to step back and ask ourselves why were the markets selling off so much to begin with? I think the global equity markets, I think at the beginning of the year got hit from every angle. They're like a collapsing pocket around a quarterback. You had geopolitical risk. You had weakness in China. You had currency and stock market action in China. So that's kind of been people's minds. You've had the weakness in the oil market. So the global equity market has gotten itself really kind of overwhelmed by negative news. And as I said, I think what happens when the central banks step in is they kind of offer this kind of sense that there is, it's not all.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Lower Borrowing rates in the economy broadly by a small amount. I think it's more of a symbolic gesture to tell you the truth than anything major. But I think it's important that given the fact that the Japanese economy has felt soft lately and their markets are suffering the same pressure we're seeing in the US and Europe, it was important, I think, that the central banks show that it's still in the game. And I think that's basically what they're doing.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, looking at the bigger picture, I'm encouraged by the fact that the two big ones that are still easing policy, the BOJ and the ECB, are taking steps in the middle of this very negative stock market we're in right now, this risk-off trade and global capital markets. I think that that's helpful. It's helpful when people investors are in a panic mode, you know, getting their mind on something else is quite useful. It's kind of like a slap in the face. And so the fact that both the ECB and the BOJ are now saying we're ready to act and support growth, I think has really helped a lot in stabilizing equity markets. Now we'll see if it works on a sustained basis, but it's very helpful. I think what they're doing is they're, I don't think this policy of going to a small negative interest rate on reserves, which is what they've done. They're going to actually charge banks a little bit for reserves. That's going to help.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then they went the next meeting, they announced it. So if you think about it, it's really, what they basically told the markets is we're so desperate, we're going to do a policy that doesn't work. Bernanke did the opposite. He said, we don't know whether it's going to be a super powerful weapon or not, but we're going to try as hard as we can, and we are going to keep trying until it works. And that's been the change that we saw at the Bank of Japan recently kind of taking a much more... Aggressive attitude and with Draghi taking over at the ECB kind of learning the lesson that yes, those central banks have been active, they've been keeping rates low, they've been stimulating growth, but they haven't really made the 100% effort. And that's the difference.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That drives rates. Crackload is zero. The first time they adopted that, before they announced it at the previous meeting, they basically said we are not going to do quantitative easing because it doesn't work.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so I think that there has been lessons learned overseas. So the Bank of Japan was for a long time almost in denial that these policies work at all. When they first adopted quantitative easing, you know, the big bond buying program.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The aggressiveness, and it was the body language around their actions that we will keep trying until it works that made Fed policy so effective. If you look recently at the European Central Bank's success under Draghi. He's taken a page out of the Bernanke playbook. His idea of do whatever it takes, he understands, I think, that, you know, when you're in a world of panic and people don't know how to value anything and the economy and the markets are collapsing, people want a sense that some in some way there's a support system out there. And so I think that that was the basic key to the success was the aggressiveness and the confidence building aspects of the policy response”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Having been a student of the Great Depression. Yeah, so you know Ben Bernanke is a very gentlemanly person, and he actually went over to Tokyo and gave some very pointed advice to the government about being more aggressive policy. And they did not like it. And so this was something that he took very much to heart, the importance of a strong reaction. What the Fed basically did is that they took a do whatever it takes attitude. And that was, you know, if we cut interest rates and the economy doesn't respond, you cut them again. If cutting doesn't work, you promise to keep them low for a long time. If that doesn't work, you start buying lots of assets. And I think that the key to this was it gave a sense to people in the markets in a very panicked condition that the Fed was there, that the Fed was never going to be out of ammunition. They were always going to have another weapon to put to work. And so it was the...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, first of all, we should say that the Fed had the benefit of Japan's experience. And, you know, we know that, for example, Ben Bernanke spent a lot of time looking at Japan and the mistakes they made. The big difference.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think that if you look at the origins of their crisis, it was a massive real estate and equity bubble that burst. And left them with a crippled banking system and a failure to kind of fix all those problems quickly. And that created this ongoing overhang on the economy. But I think over time the challenges for Japan have shifted and what you're talking about with the demographics is really the challenge going forward. It's the fact that in 1990 when Japan got into trouble at first, demographic was not an important issue. But now we're in a country that's a shrinking population, very low birth rates, and very little immigration. And so the new generation of workers is much smaller than the old generation of retirees. That's a really serious challenge down the road for Japan.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, demand issue would be, in fact, the Japanese experience in the 1990s and 2000s, a classic example of that where you have an economy that never really gets growing. And so over time prices and wage growth fade into negative territory because there's not enough spending going on in the economy. And in Japan's case, I think it was a lot of it was a severely damaged banking industry, severely damaged stock market and real estate markets that just kind of hung over the economy for long periods of time combined with a complete lack of confidence I mean, a lot of what the story of Japan was confident. So those kind of when you have a big overhang of broken markets and lack of confidence, that's really what happens when you have these big deflation episodes.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, a few items like oil falling, but it's really broad based price declines and broad-based wage decreases. Those are signs of a sick economy.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's barely over a year, a year in short. That's a year and a half, yeah. That's an amazing drop. I mean, and by the way, this isn't new. I mean, we've seen oil markets just flip. And suddenly a market that had been sustaining at very high prices, suddenly you have an oversupply problem. It just takes years to get rid of it, and you end up in this sustained low prices. But that's not deflation in the sense that we're not going to have oil prices can't drop $10 forever every month because they'll go into negative territory. That's more of a one-time kind of big adjustment in the market. Real deflation is when year after year prices keep dropping. And really, the kinds of deflation that economists worry about are not so much”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, when economists think about deflation, usually they're thinking about something that's sustained over a long period of time. So I think what you're seeing in commodity markets is really a repricing where you've gone from an environment of consistently high prices to consistently low prices. And so during that interim, you have very rapid deflation. I mean, oil prices have dropped 70% from their peak.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“You're exactly what you said. Yeah, you know, you're paying more and you're earning more, but you're kind of running in place. Deflation is when you actually have falling prices. Across the economy. This is very unusual. It really only happens in depression like conditions for a sustained period of time. The Great Depression in the 1930s and Japan's lost decade. Disinflation is just a slowing of inflation. So you're going from 5% to 3%. So that's the kind of words we bandy about all the time.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“What are the differences? Yeah, so, you know, inflation is just a general rise in wages and prices and income. So everything's going up in value over time, but it's not increasing your ability to buy things. It's just prices going higher. So if your wages go”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's over centuries, and the crisis in Europe has caused a lot of money to flow into Switzerland. That's one reason they can borrow cheap rates. The other thing is that it's created an extremely strong currency which hurts their economy. They're actually, in a sense, they're... They're suffering worse from Europe's problems than Europe itself is suffering because they end up with a very strong exchange rate. So they push interest rates into negative territory to prevent their currency from being so strong. And it's really a desperate battle by Switzerland to avoid Importing the problems of Europe.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, I think that they are, the one way to think of it with Switzerland is they're kind of an island of stability in Europe. And have been for...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, they're obviously the one part of Europe that really looks healthy. And it's not that Europe is collapsing. It's just the region has had a big double recession, never really recovered. And so Germany is kind of the model of strength there, but their interest rates are very tied into what other countries are paying. Their interest rates are determined by the same central bank as every other country there. So everyone's kind of tied into this low rate environment on the assumption that the ECB is not going to be able to raise interest rates anytime soon.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the Fed has stopped their quantitative easing debt buying program. And so there's an additional gap created by the fact that they're still in an aggressive bond buying program to try and artificially lower bond yields in hoping to stimulate their economy. Well, the Fed is kind of backed away from that. But I think that fundamentally the story here is about faith in the long run growth and inflation prospects. It's not like people are bowled up about the US. It's just kind of in the land of the blind, you know, the one-eyed man is king. My favorite expression. That's where we are now.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“A great debt snap. It's basically people saying, yeah, I'm not enough confidence in the economy to put my money to work. I'm going to take the safest investment I can and just kind of sit on it. Of course, what's also going on in both Europe and Japan is that the central bank is still buying debt.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“In the economy? Is that the implication? No, no, I think that, yeah, I mean, the bond market, the 10-year yield is an amalgam of people's expectations for where interest rates are going over the next 10 years. If you believe that the Fed has some chance of normalizing interest rates in the next few years, you're going to demand a higher interest rate on your tenure yield because you need to cover the fact that you're going to miss out on those higher rates. And I think that the, I mean, the longer history of super low rates in Japan, I mean, Japan has had not just a lost decade of growth. I mean, people talk about the 90s being a lost decade, but in effect, Japan for 25 years has been a low growth, zero or negative inflation country. And so if you're buying bonds in Japan, you don't feel you need any compensation for inflation.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Reconcile those. So, I Barry, I think what's going on here is this is actually good news for the U.S. I mean, because what we're seeing in Europe and Japan is our markets that are pricing in a world of near zero interest rates for the indefinite future, no inflation for the indefinite future. That means that investors are very pessimistic about the prospects for growth in those countries. Neither country has managed to extract itself from this kind of low near-deflationary kind of environment. The US, at least with 2% tenure yields, the markets are giving us some hope that, yeah, the US has healed a good deal, that there is some prospect of an acceleration of inflation. The Fed doesn't have to keep interest rates pegged to zero forever. So I think that the interest rate differential is telling you something about the prospect of the”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“In New York film. Well, certainly the conference rooms. Absolutely. And the idea there was, I mean, actually if you go back in history, you go all the way back to JP Morgan back in the before the Fed existed. That's what he would do. He would gather together bankers in a financial crisis, which remember the original purpose of the Fed was to prevent financial crisis, not to manage monetary policy, but prevent financial crisis. And so that role has now kind of moved into the New York Fed, obviously working closely with the chairman, but that was one of the exciting things about working in the New York Fed, right in the heart of Wall Street and in the heart of the financial system.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Tog Well, and that's the role of the New York Fed. And so we have a history of that, obviously. With every time there's a big financial crisis, the president of the New York Fed is absolutely critical because that's the person who can talk to all the leaders of Wall Street and kind of get people's heads around the problem, get people working together. And so we've had multiple instances where in a crisis moment, the New York president has kind of really taken the lead and kind of saved the financial system.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The Assistant Corporate Secretary, which doesn't sound very prestigious, but it put me in the president and first vice president's office doing work, system-wide type work, as opposed to just the local bank work. And so I learned a lot in that experience. Came to the Fed right out of grad school. The great thing about working at the Fed coming out of grad school is in grad school you learn a lot of math and statistics. What you learn at the Fed is how to apply it in a practical way to real questions of the day. And so the New York Fed with a lot of other young economists there was really a great place to kind of make a transition out of academia into more practical use of economics.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source