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Southwest Economy, Second Quarter 2020

President’s Perspective

Rob Kaplan, president and CEO of the Dallas Fed, regularly speaks and writes on the factors that affect economic growth in the nation and Eleventh District. Here are some of his recent thoughts on key issues:
On the Need for Economic Inclusivity and the COVID-19 Crisis

“For years, blacks and Hispanics have had an elevated level of unemployment versus whites. That started to improve dramatically in the last few years. We’ve now taken a step back as a result of this crisis. But a more inclusive economy where everyone has opportunity will mean faster workforce growth, faster productivity growth, and we’ll grow faster.”

Interview on Face the Nation—June 14, 2020

On the Outlook for Fed Policy

“We'll have to run, obviously, a very accommodative monetary policy for some extended period of time, and that’s going to have to be combined with fiscal policy in order to help the economy grow faster. You should expect the Fed will do what it needs to do in terms of accommodation.”

Interview with Yahoo Finance—May 6, 2020

On COVID-19 Testing

“I think at this stage, to recover faster, the health care policies are central. And what do I mean by that? Ubiquitous testing, contact tracing, good procedures … I think we could spend a fraction of what we are spending on stimulus on testing and, I’ve said before, why not spend billions to avoid spending trillions.”

Interview on Bloomberg TV—May 20, 2020

On Negative Interest Rates

“We should not go to negative rates. The big reason is it’s been tried in other parts of the world. I think it’s very questionable to me whether it’s been helpful. We have a big money market industry, we have a big financial intermediary industry. Negative rates, I think, could do great damage to both of those. So I think there are other tools that we should be using, not negative rates.”

Interview on KERA-TV—May 14, 2020

Southwest Economy is published quarterly by the Federal Reserve Bank of Dallas.

Articles may be reprinted on the condition that the source is credited to the Federal Reserve Bank of Dallas.

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