MNI TRANSCRIPT: Powell on Fed's Role in Addressing Inequality

     WASHINGTON (MNI) - The following is the portion of a transcript from

Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting

Wednesday:

     Q: Chairman Powell, the issue of inequality. What more can the fed do for

the country? You said you don't target certain groups, but is there a way that

you could use, for example, this last unemployment rate as a benchmark to

something you want to meet or something that you keep track of.

     A: We track all kinds of demographics including the African-American

unemployment rate, which reached an all-time low since the data started to be

kept in the modern era. Of course, it's still close to twice the white

unemployment rate or it was back then. It's certainly much higher now. You know,

the best thing we can do with our monetary policy tools is to look at the

evidence of what we saw with our eyes. The economy can have very low

unemployment. It can be very low without seeing inflation out of control. We

didn't even get it back up to 70s. Without seeing wages out of touch with where

they should be. That's the biggest thing we can do. Inequality is something

that's been with us increase FWL for more than four decades, and it's not really

related to monetary policy. It's more related to there are a lot of theories of

what caused it, but it's something that more or less has gone up consistently

for four decades, and there are a lot of different theories. One is

globalization -- putting globalization and technology call for rising levels and

skills and appetites and education. They flattened out over that period relative

to our peers. Soo means if you're on the ride side of those trends, then those

things are good for you. If you're not, then your wages stagnate. Wages for the

bottom 10% VBT gone up in a very long period of time. Where is wages for PEEMENT

at the top compensation? Any way you cut it, before taxes and after taxes and

after transfers, all of those any way you cut it, compensation has gone up a

whole lot of people at the top and really not for people at the bottom. If you

look in the middle, it's gone up for most other groups. In the bottom not so

much. So we call it out as an important factor in the economy. We will use our

tools to support maximum employment and take that definition to heart.

Obviously, that's something that will require an all of society, all of

government response.

--MNI Washington Bureau; +1 202 371 2121; email: brooke.migdon@marketnews.com

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