MNI TRANSCRIPT: Powell on Low Interest Rates

     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: Chair Powell, are you worried that the low interest rates are adding to

or could create a bubble of consumer and corporate debt that could make it more

difficult for, especially consumers, to recover from the next recession or

survive the next recession?

     A: If you look at, if you actually look at households, households are in

very strong shape. They're less-levered, have less debt, more income or interest

requirements and... they're in very good shape. Much better shape than they were

in before the financial crisis, so... the household sector has a sort of,

aggregate matter, is in very good shape. It doesn't mean that every single

person in the household sector is in good shape. Overall... it's really not a

concern. The business sector is something that, you know... we talked about a

lot and studied a lot and... the situation there is the level of debt relative

to GDP, in the business sector is at a high level. However... so is the size of

the business sector. The business sector, itself, is not materially higher.

Nonetheless, there are a lot of highly-levered companies. That's the kind of

thing that happens during a long cycle and there aren't downturns into our 11th

year. You get -- you get that kind of phenomenon in a long cycle. That's

something we're monitoring. I think our view still is that that, that's a real

issue, but... what it really represents is a potential amplifier of a

macroeconomic downturn. It doesn't have the makings of anything that would

undermine the workings of a financial system, for example... or, itself, create

a shock that would turn the economy down. It's more of an amplifier. We take it

very seriously though and we're monitoring carefully, we're actually looking,

the federal, financial stability board is actually conducting a project right

now to identify where these loans are held all around the world. It's the

subject of a lot of study and work, we're trying to keep on top of it.

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

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