MNI TRANSCRIPT: Powell On Fiscal Stimulus Effect On Jobs Data

     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: I know you're low to weigh in too heavily on fiscal policy, but given

your forecast for unemployment rates, do you think it's important that Congress

extend the $600 per week extra unemployment benefits?

     A: I think we try to keep our comments on fiscal policy at a high-level,

and I'm come to your specific question. I would just say this. This is the

biggest economic shock in the U.S. and world really in living memory. We went

from the lowest level of unemployment in 50 years to the highest level in close

to 90 years and we did it in two months. Extraordinary. Appropriately, the

response from fiscal authorities has been large, forceful, and very quick by the

standards of these things. Roughly $3 trillion Congress has authorized, and

that's benefits households, laid off workers and small, medium and large

businesses and hospitals and state and local governments. 14% of GDP is in a

class by itself in terms of both the size and speed of it. It's also pretty

innovative. Both the PPP and the unemployment insurance are quite innovative in

the American context, and there were difficulties in implementing it. That's

really a function of their novelty, I think. Those programs -- by the way, the

fed also noticed VATed and enacted proactively and aggressive as well. If you

put it together, AUM of that makes a difference now. If you look at the income

data, the expanded unemployment insurance and stimulus checks replaced lost

income from job loss. I think you see it in the job market data. Many give the

PPP credit on that front, and in keeping small businesses going. So it's so far

-- it's a good response and it's having a big effect. You get to the -- the

question is, it's big. Everyone can see it's big. Is it going to be big enough,

and that is a question. The question TAISH the question that I've been concerned

about really is this issue of longer run damage to the economy. We're doing a

fair job of getting through the first few months, more than a fair job. The

question is that group of people that can't go back to work quickly, what about

them? That could be many millions of people, you know? They worked in parts of

the economy that are the slow ones to recover. We want those people back in the

labor force and getting jobs, and they're going to need possibly, probably need

further support. I would say this. It's possible we will need to do more, and

it's possible Congress will need to do more. In terms of the $600 unemployment

insurance, I wouldn't try to give Congress advice on the specifics of that. I

know they're looking at -- IRN from both talking to people and reading the

papers that they're looking at a whole bunch of different possible approaches

going forward, and some of those seem kind of promising. You know, we're happy

to give advice if people ask for it. Probably not publicly.

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

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