While the economy has rebounded, the recent market upheaval in China, and the resulting ripple effects felt globally, raised concerns. The Fed’s decision to hold rates steady buys more time to gauge global markets’ strength, and possible volatility, should a rate hike be put into place in the near future.
Two prominent economists made headlines last week in visits to the Olin Business School when they shared their views on the economy and its recovery from the “Great Recession.” Former Federal Reserve chief Paul Volcker and St. Louis Federal Reserve Bank president and CEO James Bullard, PhD, offered different perspectives on jobs, financial reform and the global economy. One dared to suggest the need for increased taxes in the near future; one said the current crisis in Greece could slow the U.S. recovery.
Experts from the St. Louis Federal Reserve and around the country will be on the Washington University campus Friday, Feb. 5, to discuss the Federal Reserve’s role during the recent recession and future directions for policy. The free public conference, “Monetary Policy Amid Economic Turbulence,” begins at 2:30 p.m. in the Bryan Cave Moot Court Room, Anheuser-Busch Hall.
Fed Chairman Ben Bernanke coined the phrase “the Great Moderation” back in 2004 to refer to the relative stability of the U.S. economy over the previous two decades. Many believe “The Great Recession” of the past two years has jolted the economy out of its moderate mode and back into a state of high volatility. Washington University in St. Louis economist James Morley disagrees. He argues the Great Moderation is alive and well and will help the economy recovery from this latest financial shock.
Steve Fazzari What will generate the growth necessary to put many of the unemployed back to work again? That’s the question economist Steve Fazzari is asking as we move past the first recession of the 21st century. “In the deep downturns of the 1970’s and early ’80’s, strong consumer spending growth led to strong recoveries. Unfortunately, I just don’t see that happening this time” says Fazzari. Includes video interview.
Locking up toxic assets in a “bad bank” may sound childish, but banking expert Stuart Greenbaum says, “by isolating impaired assets and preventing them from contaminating other bank assets, banks can concentrate on the business of making new loans.”
Even though the benefits of free trade outweigh the harm, the subject has not garnered a lot of attention during this year’s election cycle. WUSTL business professor Jim Little discusses why it is important for Congress to liberalize trade and the dangers of embracing stricter policies.
While consumer spending once helped keep the economy healthy, rising consumer debt is the reason it’s getting sick. The root cause of the current economic slowdown in the U.S. goes back several decades, according to an economics professor at Washington University in St. Louis.
The Olin Business School is introducing a sports management course that will feature an “all-star” line-up of guest lecturers. Through the speakers and class curriculum, students will get a novel perspective on how the sports economy works.
Stuart GreenbaumFormer dean of the Olin Business School at Washington University in St. Louis, Stuart Greenbaum, is available for comment on the wisdom behind the stimulus package proposals under consideration in Congress. Greenbaum is skeptical that a stimulus package will be effective and proposes several other strategies that could improve the economy.