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Home / Business / You blinked and now the Dow Jones Index is down by more than 860 points

You blinked and now the Dow Jones Index is down by more than 860 points



This is some shocking news from the Federal Reserve.

Bill Dudley, former governor of the Federal Reserve Bank of New York, said that the central bank’s toolbox for supporting the economy is almost empty.

No central bank is willing to admit that it has lost firepower. Unfortunately, the Fed is close to this point. “Dudley wrote in a Bloomberg review article.

Investors and economists have been assured that the Fed will take all necessary measures to keep the market running and resume recovery throughout the crisis. Therefore, if the situation changes, it will be very important.

The Fed lowered interest rates to near zero in March, and intends to maintain interest rates at that level for several years, and has introduced numerous stimulus measures.

Of course, the Fed can do more complicated things, such as turning interest rates into negative numbers. “But,” Dudley said, “this misses the point. Even if the Fed does more, or even more, it will not provide more support to the economy. Interest rates are close to the lowest level, And the financial situation is very relaxed. “

So what?

Well, Dudley said the Fed should still do what it can, but it is clear that monetary policy can only achieve so much.

Legislators and the White House decide the needs of the economy “Now, this means a greater degree of fiscal stimulus.” He said.


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