Fed wonders - where's the rebound

Brad DeLong delong at econ.Berkeley.EDU
Thu Jun 21 12:06:38 PDT 2001



>[Berry is extremely well-connected, one of the Fed's prime leakees.
>So this counts as a virtual press release for official thought.]
>
>Analysis
>Fed Wonders: Where's the Rebound?
>Policymakers Worried by Economy's Unusual Resistance to Rate Cuts
>
>By John M. Berry
>Washington Post Staff Writer
>Thursday, June 21, 2001; Page A01
>
>As U.S. economic growth remains stubbornly sluggish, some Federal
>Reserve officials are growing increasingly concerned that unusual
>developments may be clogging the main channels through which lower
>interest rates normally stimulate the economy.
>
>After five half-percentage-point rate cuts this year -- the most
>aggressive such actions by the central bank in nearly 19 years --
>there is no sign yet of a rebound.

Why would they have expected to see *anything* before September? Long and variable lags are... long and variable.

Brad DeLong



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