MNI TRANSCRIPT: Powell On Great Depression Comparison

     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: There have been plenty of comparisons of the Great Depression of the

1930s to the crisis here. Is that scenario sort of that more dire (

indiscernible ) and we're looking at a month traditional and sudden recession?

Are you at all concerned that the performance -- the strong performance in the

soft market in the last few weeks is disconnected with reality?

     A: I don't think that the great Depression is a good example or likely

outcome for a model of what's happening here at all. I really don't. There are

so many fundamental differences. First, the government response has been so fast

and so forceful. The origin was quite different. This was a very -- an economy

that was in a healthy place. Of course, every economy has a longer run

challenges, and that includes our economy. Notwithstanding 50-year low in

unemployment and the longest expansion in history and every reason to think it

could continue. That's different that's what was happening around the time the

Great Depression started. The financial system this time was in very good shape,

much better capitalized. It's just not the right model. I would say we learn

every month that passes. We see more and learn more, and I think particularly

the next few months are POFRNT learning the significant incoming data about the

opening of the economy. I would say assuming that the disease remains or becomes

pretty much under control, I think that what you see is a very weak second

quarter, historically weak, and expansion that builds momentum over time. People

will adjust probably a little bit gradually to some of the activities that

involve getting together in large groups and close quarters. Those are the

harder pars of the economy to recover. Ultimately we see a full recovery over

time. That's really what I think I'm personally seeing. You could see

significant job growth in coming months, but you face an extended period for

where it's difficult for people to find work. That's what you see in really,

really many forecasts at this point. That doesn't mean it's right, but that's a

broad expectation. Certainly not the depression forecast.

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

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