“But we’re a long way from neutral at this point.”
When asked how much he worried about another “financial crash,” Fed Chairman Jerome Powell told PBS News Hour that the “next set of problems” wouldn’t “look a lot like the last set of problems we had.” It would be “something else, a cyber-attack, some type of global event.” And then he threw in the zinger: “Or maybe it will surprise us and look exactly like the last one.”
It’s those zingers that deviate from the official script that make his Q&A sessions so revealing – I assume, purposefully so. And he pointed out just how hawkish the Fed is getting in its “very gradual” manner.
The interview was wide-ranging and triggered laughter in the audience on several occasions, a feat for Fed Chairs, but I’ll focus on what he said concerning risks and interest rates.