Former Federal Reserve bank president Eric Rosengren says the Fed should do more to stimulate the economy. He thinks the current Fed is acting too slowly and that the unemployment rate needs to be addressed more aggressively.
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The Fed’s Operation Twist program is scheduled to be complete at the end of June. At that point, the total amount of the short-term bond that have been converted through sales to longer maturities will be $400 billion.
Rosengren’s concerns lie primarily in the political arena, specifically regarding actions that leaders in both America and Europe might take. The future health of the US economy is directly tied to those decisions and he feels a structural problem can be pre-empted if more stimulus is added to spur job growth.
Although the private sector has been growing, less government spending is counteracting the effect of those gains. World Bank president Robert Zoellick adds that the global economy is in danger. Europe is the largest direct threat but global economic factors are also affecting developing countries, which have conglomerately been the primary global growth engine to this point.