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There is of course the direct impact of the shutting down of the U.S. economy, the loss of several hundred thousand jobs at least, and reduced output production in the Gulf.
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Economics is a very difficult subject. I've compared it to trying to learn how to repair a car when the engine is running.
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Because financially capable consumers ultimately contribute to a stable economic and financial system as well as improve their own financial situations, it's clear that the Federal Reserve has a significant stake in financial education.
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The public has shown confidence that any increases in inflation will be temporary and that, in the long run, inflation will remain low.
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House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals.
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High energy prices are burdening household budgets and raising production costs, and continued increases would at some point restrain economic growth.
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The crisis and recession have led to very low interest rates, it is true, but these events have also destroyed jobs, hamstrung economic growth and led to sharp declines in the values of many homes and businesses.
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The banks have accounts with the Fed, much the same way that you have an account in a commercial bank.
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As long as there's not permanent damage to our energy infrastructure, the effects on the overall economy should be fairly modest.
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Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services.
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The best approach here if at all possible is to use supervisory and regulatory methods to restrain undue risk-taking and to make sure the system is resilient in case an asset price bubble bursts in the future.
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Evolutionary psychologists suggest that humans experienced evolutionary benefits from brain developments that included aversion to loss and risk and from instincts for cooperation that helped strengthen communities.
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Monetary policy cannot do much about long-run growth, all we can try to do is to try to smooth out periods where the economy is depressed because of lack of demand.
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This step would in no way reduce the importance of maximum employment as a policy goal, ... In any case, I assure this committee that if I am confirmed, I will take no precipitate steps in the direction of quantifying the definition of long-run price stability. This matter requires further study at the Federal Reserve as well as extensive discussion and consultation.
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If I am confirmed to this position, my first priority will be to maintain consistency and continuity with the policies established during the Greenspan years.
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To achieve a more balanced international system over time, countries with excessive and unsustainable trade surpluses will need to allow their exchange rates to better reflect market fundamentals.
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Banks will have to win the confidence of their customers through fair dealing, making good loans, and remaining financially healthy.
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Community banks are generally doing quite well, and I expect that good performance to continue. Neither bankers nor their supervisors should become complacent.
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The ultimate purpose of economics, of course, is to understand and promote the enhancement of well-being.
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If you want to understand geology, study earthquakes. If you want to understand the economy, study the Depression.
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Our financial system is so complicated and so interactive - so many different markets in different countries and so many sets of rules.
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Developments in financial markets can have broad economic effects felt by many outside the markets.
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There are a number of institutions globally where the Federal Reserve typically leads the U.S. effort to work with financial regulators from other countries, and we try to, to the extent possible, establish international standards for how - the amount of capital a bank should hold, for example, or how much.
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Many foreclosed homes are neglected or abandoned, as legal proceedings or other factors delay their resale. Deteriorating or vacant properties can, in turn, directly affect the quality of life in a neighborhood, for example, by leading to increases in vandalism or crime.