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Former Fed Vice Chair Alan Blinder on whether the Fed should consider lending directly to banks and whether there will be further stimulus by the Fed.
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Your back in Alan Blinder now -- as an audio issues that -- you earlier but I ask you you know and you're talking about.
The fact that Ben Bernanke could and should potentially.
In defense and he's mentioned this before.
The lend directly to.
The bank's possible do you think that is -- I you know I think in the near in the very near term like tomorrow I think it's extremely remote very remote.
But I think if they watch the British plan and it looks promising and they can get over some of the legal hurdles because I was I was saying they just can't land on any kind of collateral.
There restrictions on that.
Then I can imagine the Fed doing this presuming the economy doesn't suddenly perk up there is economy suddenly -- up the settled get fat and happy -- won't do anything.
That doesn't look very likely frankly.
Well let me ask you this okay overall -- Ben Bernanke what we're not what we're not gonna get tomorrow is gonna be that press conference -- seems to be a line of thinking today among market participants.
That we're not gonna get much in the way of the statement because they're gonna wait until Ben Bernanke can come out to the podium.
Do that to 15 2:30 eastern time whatever press conference that's what we're gonna see real stimulus coming from the -- how likely do you think that it.
Us.
You know as I say I think it's a coin tossed.
Then it would -- -- the sentiment that says it's better if he can follow the press conference is exactly correct.
On the other hand he has other ways to communicate.
And the other consideration -- you start getting closer to the election.
It would be easier politically I think not that it's -- easy politically in this kind of a climate.
But a bit easier politically.
To do something tomorrow and to wait till September.
And I don't mean to save September's out.
Because of proximity to the election I don't believe that but this kind of us.
It's a bit more awkward for the Fed to do something that close to an election than to do it say August 1.
As a close out here Alan is there anything realistically the Fed can do at this point right this is the longest economic recovery.
US economic recovery in our history so really is there anything meaningful the Fed can do at this point.
Well depends what you mean by meaningful if you mean is there anything the let's say due to -- members of this legacy.
Yeah I know the Fed has nothing like that in his arsenal and I think the -- forever stamps -- unemployment.
Florida 4% or -- sand -- -- I think.
If they can do that stated done -- -- yes no they have nothing.
-- look the most powerful weapon in their arsenals the federal funds rate it's been stuck near zero since December oh wait already.
-- another thing that powerful Alan Blinder former fed vice chairman Alan thank you very much it was good to get -- back after the commercial we were suddenly.
-- your comments as we get a decision tomorrow -- my pleasure sorry about the equipment -- beaten that television.
