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Triple digits today on hopes the Federal Reserve will come up with more stimulus.
The Federal Reserve meeting this week to discuss the state of our economy the aftermath of the Greek election.
And of course the markets so is more stimulus ahead let's ask former Federal Reserve governor Randall -- there.
Professor of economics of the University of Chicago Booth school of business -- welcome back the show it is always great to have you here.
There's a lot of speculation right now that affect the Federal Reserve might do something that they might ease monetary policy.
Do you expect that to happen.
I think the markets may be expecting a little bit too much I think the Fed certainly is going to say that the economy is facing a lot of challenges the job market has been very very weak.
And probably wants to provide a little bit more support but I think if they're expecting some really big gift from the Fed they may be a little bit disappointed.
What do you think should happen should the Fed sit on his hands here is there reason for there to be.
Nation for the Fed to come and and -- to buy more treasuries.
Well -- a lot of different options what they can do I think one of the things we'll do is sometimes called open mouth operations -- an open market operations.
To try to give some confidence of the markets that -- -- zoo is you know if something goes wrong in Greece and in Europe.
The full stand by to make sure that the the impact is is minimized.
And one of the things that that we -- do well I was the Fed I think there's still.
Really animated -- to avoid.
A major deflation where major shock the could push into a very bad situation for that that's more than trying to take -- the tail risk of I'm not quite -- -- create jobs.
It's it's interesting that you say that because Treasury Secretary Tim Geithner telling moments ago say.
That you know the EU's financial problems are the EU's financial problems with any added as a caveat.
We will be there if they need us now what the heck does that mean because it sounds like he's talking out of both sides of his mouth.
Well since he just say that I don't really have the context I'm not quite sure but I think.
One of the things that are both chairman Bernanke and then and secretary Geithner been talking about is.
The the potential consequences of something going wrong in Europe for the US.
And so thinking about trying to protect the US means that we.
Broadly would want to stand with the Europeans to try to avoid some sort of chaotic -- -- chaotic outcome but I'm not sure what exactly what he has in mind.
Yeah I -- its fastening a tantalizing really what he said.
You can't figure out which side is really coming out on.
What do you think is the outlook though for the balance of the year here's the Fed meeting at a time we've had.
These Greek elections.
Really didn't tell us all that much at the end of the day about what's gonna happen in Europe.
What do you think will be the Fed's policy going forward here.
And this is incredibly challenging time for the Fed and central banks around the world because it continues to be uncertainty in Europe.
And the Greek election did not cause chaos but certainly.
We don't know what's going to happen in Europe we don't know what the Europeans are going to do what they're going to be able to settle these problems so there are lots of risks all over the place.
And so I think the -- -- is going to downgrade its forecast.
Going to be more worried about these these tail risks -- kind of characterize how I think the rest -- Year's gonna go -- sort of a sideways slide.
That we're not gonna see a big boom we're not gonna see a double dip.
We're just gonna gonna move along.
With OK growth.
Some job growth but not enough to bring on the unemployment rate a really challenging time.
A really challenging time and nobody likes that.
Low -- 2% growth for GDP -- just.
As a result in the kind of hiring we need right now we -- thanks for coming on tonight is always a pleasure to have you on the show.