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Key meetings this week with -- the Federal Reserve and the European Central Bank.
The Fed which seems to be leaning towards more stimulus for the US economy started its two day policy meeting today but can we expect any action soon.
Let's ask former Federal Reserve governor -- Crossair.
Professor of economics at -- university of Chicago's Booth school of business reading level back the show it's always great to have you here.
We had Alan Blinder on today on our network anything -- flip -- nickel.
Over the likelihood of something happening at this meeting it's totally up in the air what's your view.
Well I think that a lot of conflicting views are on the table I think their number of people -- really wanna move forward and do some more and other people are saying -- the data.
Don't look great but they don't look so bad that we need to act yet and remember at the last meeting they just undertook an additional stimulus.
By extending the so called twist of selling short term securities and buying long term securities to bring that long term rate down.
We think is the most critical part of the data.
For the bad idea is it jobs they're considering is -- something else.
I really think jobs is that the key thing and it's one of the reasons -- things will be hesitant to move now biggest since the last meeting there's only been one jobs report.
Which was not so great but not so terrible.
And if they wait until September they're gonna get to more jobs reports and a lot more information about us on the uncertainties in Europe.
Well a lot of analysts a lot of economists like yourself out there saying September is -- much more likely timeframe for some kind of action what -- that action most likely be.
Well I think one of the things the Fed wants who's going to be a little bit clearer about.
-- What it's going to do.
And try to give a little bit more information about how it makes decisions they be able -- more guidance about the conditions under which they're likely to to provide more stimulus.
If for example they could say if the unemployment rate continues to stay above 8% and the inflation rate continues to be below 2% basic conditions under which we would act.
While up in that would be good more clarity is always a good thing.
You say though and I want to hear about your view on the economy is say -- -- something like a sideways slide what you mean for that despite that in.
Could we go into recession again.
Well I never say never about anything I don't see that on on the horizon but I think we've kind of been stuck in this slow growth period.
Where the unemployment rate hasn't really come down hasn't really gone up.
It's been about eight point two percents for about six months is probably going to be around 8%.
Going forward for the next six months we've had some growth but not very strong growth we've had some private sector job creation.
But not enough to bring -- Premium -- down and I think that's why -- press thinks it's kind of been a sideways slide.
Methods that a lot to try to support things to make sure don't slide down -- two 1930s style Latin 1930 -- deflation.
But I think it's now going to be up to the fiscal authorities and also some of those decision makers in Europe.
To try to do -- get some the uncertainty.
Out so that done consumers can consume many businesses can invest.
-- you say in fact that I Europe is struggling with the same issues that we had after the revolutionary war -- so.
Well for the revolutionary war -- -- very very Lucent confederation the articles of confederation.
That did not give the central government the power to tax.
But that led to a very very well weak structure amongst the states -- had a very high inflation.
During that time period that was the only way that they in the continental congress could could raise revenue.
Much for the phrase not worth the continental -- because they're comfortable congress was issuing dollars and they didn't being they weren't very very valuable.
But then we Alexander Hamilton came along said this is no way to run a country and particularly for security reasons we needed -- union.
-- the threats from from that the British.
And so we integrated more and we got the us constitution.
Well maybe interest in mid to CF European -- war I that's -- that's a tough fact.
Hill to climb I think it is very tough -- I -- reading things for coming out tonight we'll have our eyes peeled for that news tomorrow from the Fed.