The Journal. A Fed Insider on the Looming Rate Cut
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Sep 5, 2024 Mary Daly, President of the Federal Reserve Bank of San Francisco, shares insights on the upcoming interest rate cuts that could reshape the U.S. economy. She discusses the delicate balance between controlling inflation and maintaining employment. Daly emphasizes the personal toll of inflation on everyday Americans, weaving in human stories to highlight how vital these economic decisions are. From navigating job market challenges to the Fed's empathetic approach, this conversation is a deep dive into the complexities of central banking in today's world.
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Mary Daly's Personal Struggle with Inflation
- Mary Daly, despite being a Fed president, has faced economic hardship.
- As a high school dropout in the 1970s, she worked multiple jobs and struggled with inflation's impact.
Trade-offs of Raising Interest Rates
- Raising interest rates fights inflation but creates other financial challenges.
- This tradeoff is necessary for long-term stability and growth.
Looming Rate Cuts
- Lowering interest rates is now appropriate as inflation nears the 2% target.
- The Fed aims to prevent further labor market slowdown and avoid over-tightening.