Bitcoin, crypto, and blockchain empower new business models and increase global coordination. We have a great economy. POWELL: Well, I would take a more optimistic cut at that, if I could, and that is: this is a time of great suffering and difficulty. It is true that deficits are going to be big for a couple of years here. When unemployment is low, when economic activity is high, that’s when you deal with that problem. This is something that shows up in the data — that longer and deeper recessions tend to leave behind damage to people’s careers. And more important than that, the sooner people will become confident that they can resume certain kinds of activity. With the hopes of stimulating economic activity, backstopping the public equity markets, and shoring up the banking system, the Fed injected trillions of dollars by purchasing government securities, providing corporate and small business loans, and purchasing high-yield “junk bond” ETFs. As a central bank we have the ability to create money digitally. Its assets are mainly the securities it purchased on the open market and loans it made to financial institutions and now businesses. We’re not out of ammunition by a long shot. The sooner we get the virus under control, the sooner businesses can reopen. We have the most dynamic economy in the world. But in a sense, the real-time economic data that we’re seeing is just a function of how successful the social distancing measures are. The U.S. economy will claw its way back from the current downturn but may need a coronavirus vaccine before that is complete, Federal Reserve Chairman Jerome Powell said. Fed Chairman Jerome Powell told "60 Minutes" that people shouldn't "bet against the American economy.". (Please note that in general I don’t necessarily agree with his comments, and in many cases disagree with them): SCOTT PELLEY, CBS NEWS / 60 MINUTES: There’s only one question that anyone wants an answer to, and that is: when does the economy recover? And my sense is that it’s likely that we’ll have a couple more months of net job losses. EY & Citi On The Importance Of Resilience And Innovation, Impact 50: Investors Seeking Profit — And Pushing For Change, providing corporate and small business loans. And it looked like we would continue to see that going forward for some time and further and further benefits. Do you consider the virus under control? They’re so much stronger than they were before the financial crisis, the last financial crisis. Again, this is an economic shock that’s different and bigger than any in our lifetime. It seems as a reasonable base case that there will be more layoffs probably this month and next month. So the data we’ll see for this quarter, which ends in June, will be very, very bad. While he sees a rebound coming in the second half of the year, he added that a full recovery may not happen without a coronavirus vaccine. I am a VP of Digital Asset Strategy at Fundstrat Global Advisors. It was a busy weekend for Federal Reserve Chairman Jerome Powell, who spoke on Friday night in California and then on Sunday night on CBS’s 60 Minutes. Jerome Powell gave his first interview to “60 Minutes” last (Sunday, March 10, 2019) night. And we will. The United States is the world’s reserve currency. In fact, they were right at the heart of that. JEROME POWELL, CHAIRMAN OF THE FEDERAL RESERVE: It’s a good question. U.S. Federal Reserve Chairman Jerome Powell appeared on 60 minutes May 17 th discussing the Fed’s recent operations to stabilize the economy. PELLEY: Well, that is the question that everyone wants an answer to: “What is a while?” Can there be a recovery without a reasonably effective vaccine? So in the long run, I would say the U.S. economy will recover. What we can do is the part of it that we can control — is to be careful as businesses go back to work. © 2020 CNBC LLC. The dollar is the world’s reserve currency. PELLEY: What gives you hope in this dark time? Do you think history will look back on this time and call this the Second Great Depression? The big thing we have to avoid during that period is a second wave of the virus. The American economy will recover," Powell said in an interview on CBS' "60 Minutes" in an excerpt aired Sunday morning on "Face the Nation.". 5 out of 330,000,000. POWELL: Well, as I mentioned, in the long run, I would say I would never bet against the American economy or the American people. And this is an outside event, it is a natural disaster, in effect. This economy will recover. POWELL: No, I don’t. I’m highly confident of that. And so I think that kind of support may be appropriate. And I do think that over the next couple of months, you’re going to be seeing the beginnings of the recovery, as people, as businesses reopen and people go back to work. A digital store-of-value that is immutable, scarce, supply-capped, and non-sovereign resonates amongst investors embracing the emerging digital world. In the ’20s when the Depression, well, when the crash happened and all that, the financial system really failed. And it’s heartbreaking because where we were just two months ago was we had the lowest unemployment in 50 years, the lowest African-American unemployment ever since we began measuring it. POWELL: You know, at the moment, the thing that matters more than anything else is the medical metrics, frankly. There’s really no limit to what we can do with these lending programs that we have.”. We can buy time with that. "This is a time of great suffering and difficulty and it's come on so quickly and with such force that you really can't put into words the pain people are feeling and the uncertainty they are realizing," Powell said. While he sees a rebound coming in the second half of the year, he added that a … PELLEY: Many states are beginning to reopen their economies. https://realinvestmentadvice.com/jerome-powell-on-60-minutes-fact-check The video of the Interview and transcript can be seen at “Federal Reserve Chairman Jerome Powell On The Coronavirus-Ravaged Economy.” Below are Jerome Powell’s comments I found most notable in the order they appear in the transcript. However, he added that "for the economy to fully recover ... that may have to await the arrival of a vaccine.". It’s all the things associated with that. In addition, the Fed is buying corporate and municipal bonds. "In the long run and even in the medium run, you wouldn't want to bet against the American economy. A Division of NBCUniversal. And that we think can happen as soon as the third quarter. We can get back to a healthy economy fairly quickly. An entire industry has emerged reading the tea leaves, parsing, and interpreting every comment Powell utters in regards to the Fed’s future actions. They were a key mechanism for amplifying bad things that happened. And staying at it. The video of the Interview and transcript can be seen at “Federal Reserve Chairman Jerome Powell On The Coronavirus-Ravaged Economy.”. In this case, you have governments around the world and central banks around the world responding with great force and very quickly. And it won’t take that long to get there. It may take a while. Fed Chairman Jerome Powell told "60 Minutes" that people shouldn't "bet against the American economy." And we’re the home of so much of the great technology in the world. PELLEY: As this period of time grows longer, what begins to happen to the economy? People will need to take certain measures to protect themselves. And that means people will go back to work. Bitcoin has value despite the nonexistence of any central entity to dictate its monetary policy or backstop the system. Federal Reserve Chair Jerome Powell arrives for a news conference following the Federal Open Market Committee meeting in Washington, December 11, 2019. We’ll get back to the place we were in February; we’ll get to an even better place than that. In my writing, I explore how digital assets enable new use cases and their second-order effects on economics, finance, and politics. And we have the ability to borrow at low rates. Exactly the opposite of what needed to be done. America's Economic Future – A Discussion By Ted Kavadas, Jerome Powell gave an interview to “60 Minutes”, which was broadcast Sunday (May 17, 2020) night. How long can that go on? They’ve funded those. And it’s come on us so quickly and with such force, that you really can’t put into words the pain people are feeling and the uncertainty they’re realizing. It’s the spread of the virus. The Fed increased its balance sheet by $2.8 trillion, or 60%, just since February of this year. The good news is that the 20 million people who’ve been laid off overwhelming report themselves as having been laid off temporarily. We’ll see unemployment come down. And that’s because they expect to go back to their old job. Got a confidential news tip? PELLEY: What we’re seeing is the federal government borrowing trillions, upon trillions of dollars to try to dig us out of this hole. Historically, gold served as the best hedge against monetary and fiscal exorbitance. The banks have been strong, they’ve been fine. POWELL: There’s no need to do that. PELLEY: Finally, what metrics are you looking at here hour by hour, day to day, to divine what the future is going to be? Companies have pulled down their lines of credit. I do think that people will be careful about resuming their typical spending behavior. Going out, going to restaurants, traveling, flying on planes, those sorts of things. So the banks have been strong so far. I don’t think that’s a likely outcome at all. Cohn also stressed the importance of getting the economy going again. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. Sign up for free newsletters and get more CNBC delivered to your inbox. We hope that it will be shorter than that, but no one really knows. I write about the intersection of technology, economics, finance, politics, and crypto. So I think we’re going to need to help each other through this. The time to deal with that, the time to get on a sustainable fiscal path, which really just means that the economy is growing faster than the debt, and that means you’ve got to control the growth of the debt — the time to do that is when the economy is strong. And it’s going to take a while for us to get back. Unemployment will get back down. We’ll see GDP move back up after the very low numbers of this quarter. Of course, we’re also looking at the employment data. But I would just say this. So what we’re really looking at is getting the medical data, which is not what we usually look at, taken care of so that the economic data can start to recover. "Assuming there's not a second wave of the coronavirus, I think you'll see the economy recover steadily through the second half of the year," the central bank chief said. Then, assuming that the economy does begin to reopen and we do that successfully, you’ll see people going back to work. PELLEY: 25% is the estimated height of unemployment during the Great Depression. And if that happens, it will take some time to recover from it. Although it continues to be volatile and lost 50% of its value on March 12th as the rest of the markets tanked, it rebounded sharply and is one of the top performing assets this year. It will take some time to get there. The Fed has launched a series of efforts to keep markets functioning properly and has teamed with the Treasury Department on a variety of lending programs aimed at businesses and individuals.