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The Federal Reserve making it clear that it is willing and ready to start tapering its bond buying program when appropriate and that may very well be later this year may be -- unemployment still high and economic growth weakened tepid.
Is the fact making the right move intended exit the program gracefully -- will it be as former Fed Chairman Alan Greenspan put it Massey.
Then that's gotten her from yeah yeah yeah I think put us in -- Fox Business exclusive yeah.
-- -- -- former presidents of the Federal Reserve Bank of Minneapolis.
Greenspan has certainly other issues he could discuss as well but.
You know thank you so much for being here Gary you've -- of you had that you had a very unique.
Perspective -- of this I'm sure you've been wondering what's been going on in there as well.
-- Ben Bernanke before we get to you know can -- get out of it gracefully has mr.
-- done everything he could and you generally agree with everything he's done.
Well I think the Fed has genuinely been heroic throughout this because obviously the the economy and the markets have felt face major challenges.
But I think the Fed has.
-- a lot to try to alleviate that.
Hopefully they've been wise as well but you know these have been unchartered waters in many ways not the kind of thing that central banks have typically faced.
And so I think we we have to still keep our fingers crossed.
A bit and hope that who what we experience going forward turns out to be positive I'm reasonably confident but.
The jury is still a lot of citizens and help.
From -- experience having been behind closed doors with the Federal Reserve of your Arab making those decisions.
Up how things look and I know it's hard because it you face different challenges back when you were there but.
Now everybody's worried about when the tapering will begin but maybe that's precisely how we wanted it to float it well in advance.
So the people then absorb -- and so called -- the news -- Well I think that's right I think the Fed certainly prefers not to surprise market participants and that means you have to start.
Talking about things well in advance of taking action.
I don't think there's any question about that even in more normal times you would want to do that.
So I I think in that sense.
They were wise to begin the discussion especially because.
If you look at the -- tenor of the economic news that has become available over the past.
Twelve months plus or minus it's generally been on the somewhat more positive side than expected.
It hasn't been.
Grossly more positive than expected but.
Mildly more positive -- a consistent way and so I think the Fed reading the reading the tea leaves and probably looking at and improved outlook.
Decided to -- to begin the discussion.
Is it too early -- -- -- some people say it is you know the Fed likes to meet its targets and with regard to unemployment at six -- opposite -- -- long way.
For that level.
And so are -- being a little premature.
Well it all that remains to be seated and in two senses one is of course.
I think the Fed has been careful to emphasize that this is all conditional conditional on incoming information.
And so if the -- -- -- continues to be on the positive side than their timing is going to look pretty good.
But I think we shouldn't exaggerate.
The Fed's influence either after all we have a huge complex sophisticated economy.
The Fed doesn't have to get it precisely correct they have to get it approximately correct avoid big errors.
What was it like sitting in on big decision meetings -- what was the the most dramatic moment when you were at -- -- Well you know there were several obviously -- -- for long term capital management and data is wonderful that was a capital management that was a bit -- that was a fun for those of you don't remember that that nearly blew up and took down the Russian Ruble and then there was a lot of involvement -- similar.
-- -- stock market crash of 87 and I was there for the end of technology.
But nothing nothing really rivaled the most recent financial crisis.
Because one thing started to unravel.
In 2008 they really unraveled very very quickly and it was.
A global phenomenon so there was there at the risks were enormous would you wanted to be a part of these most recent discussions -- -- be happier outlook.
I'm happy that that others have the I thought I I certainly loved my years at the Federal Reserve but the responsibilities now somebody else's -- case.
Picking -- somebody else who takes over for Ben Bernanke there's been a full worry.
Of activity when it comes to talking about first it was Janet Yellen then it became Larry Summers the former Treasury Secretary.
The Republicans are already getting out there saying there's no way that we would ever consider Larry Summers -- -- all kinds of issues the what and that's not on there is is.
Is somebody that that you -- for example well.
Alan you know who's at Dover Princeton -- why Alan Blinder -- that there are other names that are possibilities you know your best guess yeah I mean I think.
There are at least two criteria one is you want somebody who's.
Capable and qualified well prepared and -- we want somebody who can get confirmed which is not necessarily easy.
Apparently -- So I think there's several people who would pass both of those tests both of those -- slapcast Janet Yellen is one.
Alan Blinder is another Don -- Roger Ferguson.
In fact all of those people have been confirmed in the past sometimes multiple times.
And so I think not only are they capable but there's reason to believe that they would pass that second hurdle now the question is.
-- all who is the president comfortable with what -- -- advisors think etc.
We come back sharp -- up your perspective thank -- so much thank you thank you Gary stern.
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