You're watching...
RDQ Economics Chief Economist John Ryding on whether the Fed has helped or hurt the economy.
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
Our next guest says -- enough already the Fed has already done too much John -- you heard and saw him earlier steep economist with RTQ accounts -- talk about Christmas decorations.
In a minute but you think that the Fed doesn't need to do anything more from here.
I don't think that the economy is being held back by.
Interest rates due to high defense Richard zero.
Mortgage rates that are too high he can't refinance it's not because of the rate the debt.
What because the banks don't have enough resist this one point seven trillion dollars in excess reserves.
In the financial system already so.
The fact is.
Pushing on the -- as far as trying to encourage real economic growth but it can cause inflation I believe quantitative easing last year.
Boosted commodity prices boosted oil and food prices boosted inflation.
And that's squeeze consumer really that they actually and actually hurt the economy -- than help the economy so what needs to happen so the Fed.
Is the Fed powerless to do anything -- it sounds like that if anything is gonna happen it's animal spirits coming back and it's.
And it's Washington actually making doing business easier this -- think what the threat is out of Greece now the US exports -- Billion dollars of goods.
To Greece which is a very very small some.
In a fifteen trillion dollar economy so why does Greece pose a threat to the US because of -- of systemic risk the walk in the fat content.
Whose guarantee that no systemically important institutions.
Will.
Run out of liquidity because we know that when.
Confidence goes in financial companies which are -- he goes very quickly with so with -- company Bear Stearns in March 2000 so with Lehman Brothers.
We've so it with the GS sees.
We've seen it this week.
It's very important that the Fed says we're going to make sure there's no financial market repercussions but in terms of stimulating economic growth.
The Fed can not offset that risk what we've really need.
It is.
Pro growth incentives.
In the tax system lower tax rates -- the tax base.
Longer term control of government programs -- should I -- entitlement spending so two people can know with some certainty.
Where the policy in the economy is headed to.
And I think right now it's -- can our economy grow if we don't get that a -- out of Washington.
What we can't grow we have been -- and we -- what -- -- -- sent between the road to bring the unemployment rate at Pratt that's that's the real problem because.
To do that economy needs to be growing at 4%.
With 5%.
And.
In the past -- recessions that with -- -- that was the pace the economy grew up now this is a different kind of reception.
Recession because the financial crisis.
Experience is being coming financial crises akin to this one.
The -- -- Washington.
Or it can do a more and I I think the further action can be better if the Fed.
-- -- -- Whatever power it looks like a bunch of geniuses compared to Europe -- I want to note what do you think that does turn in to pay for the global economy but very significantly.
Decision to hold this referendums and I -- say.
The markets have to wait.
For the Greek.
Government.
But shouldn't surprise this week to that put a referendum forward which is certain.
Lots lessons in 1974.
Up -- the -- go back to being a monarchy.
And we -- markets and patient so this very much if I with the leaders of the EUI will be since we need a backup plan to deal with.
And under control default on Greece we need to have a much bigger fire break from the -- we negotiate when Greece was playing bowl.
As it was last week.
And that -- for the need tough for the donate time for.
We are going to have more systemic problems in Europe and then that's from and -- -- In the -- step in the key thing to watch that Italian German bond spread over 450 basis points -- -- -- fell back -- I'd rather see Christmas trees and -- -- I think.
Thank great state John riding a RDQ economics.
It's annoying right on cue -- -- in.
On holidays and Reid put the Christmas decorations up I got vibrations.
In -- Big -- Christmas trees up everywhere so they're looking for a big payday from Santa but we're still comparable months away yet relax here that's our one burning question today with all -- that in mind -- upset about it where.
Well we're upset about it more upset about this ridiculous picture Abbas on the street which is also on our newspapers that that that but the amount up allied.
But yeah.
How much still hot let's do you plan to spend this holiday season is our question -- A big guy in Dallas stated it ballot boxes of dot com -- bad are things that I think that dot com slash dating come I'm -- because I know -- as a Scrooge you are.
-- -- that Novell I'd like I'd love Christmas is -- you know chances are encouraged to my dance in -- but I love Christmas immunity grants that stole -- size 32000 joy out of everything that is such an exaggerated if that's ridiculous.
The minute that.
