The Outlook for the U.S. Economy. 2009 FRB St. Louis Professors Conference Zero Bound, Credit Easing and Quantitative Easing St. Louis, MO November 5, 2009 Kevin L. Kliesen Federal Reserve Bank of St. Louis Not an official document. Overview of Today’s Talk. The Big Picture
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2009 FRB St. Louis Professors Conference Zero Bound, Credit Easing and Quantitative Easing
St. Louis, MO
November 5, 2009
Kevin L. Kliesen
Federal Reserve Bank of St. Louis
Not an official document
3.5% growth in 2009:Q3
Retention actions rose nearly 22 percent in 2009-Q2.
Oil prices are already around $80 per barrel.
Living beyond our means!
An all-time high!
Rebalancing the economy away from consumption to business investment.
Some Good News For Households:
Financial conditions have improved modestly further . . in one dimension.
FSI is comprised of 18 weekly, interest rates, yield spreads, and other financial market indicators (e.g., equities).
The outlook over the second half of 2009 continues to improve!
Growth in 2010 likely to be around 3%.
Pump priming by the Fed
There is some risk of much higher inflation beginning in mid-2010 and continuing into early 2011.
Positive job growth not likely until early 2010
About a 1-in-6 chance of a double-dip in 2010.
Something has got to change!