AMERICAN ECONOMY - Markets and Fed Response

"Markets plunge amid fears of sharply higher interest rates" PBS NewsHour 6/13/2022

Excerpt

SUMMARY:  Wall Street has gone into meltdown mode over inflation fears and the possibility that higher interest rates are imminent.  The Dow Jones Industrial Average, NASDAQ and the S&P 500 all fell significantly.  It is now officially a bear market, down more than 20 percent from its January high.  Julia Coronado, MacroPolicy Perspectives president and former Fed economist, joins Judy Woodruff to discuss.

 

 

"Federal Reserve implements highest interest rate hike in decades to combat inflation" PBS NewsHour 6/15/2022

Excerpt

SUMMARY:  The Federal Reserve on Wednesday ramped up its efforts to fight inflation with a notable interest rate hike.  Officials voted to raise rates by three-quarters of a point, a jump higher than expected just a week ago.  Fed chair Jerome Powell acknowledged the ongoing rate hikes might slow growth later this year, as the Fed projected unemployment would rise to 4 percent by 2024.  Paul Solman reports.

ECONOMY - Shares Take Beating Worldwide

"Investors Worldwide Watch Shares Take a Beating" (Part-1) PBS Newshour Transcript 9/22/2011

JUDY WOODRUFF (Newshour): Investors worldwide had a rough ride today. Sell-offs hit all the major markets amid downbeat reports from Asia, Europe and the U.S. Federal Reserve. At one point, on Wall Street, the Dow Jones industrial average was down well over 500 points. It finished with a loss of just under 400.

Traders at stock exchanges around the world sat glued to their many screens, as they watched shares skid down, down, down. When the closing bell clanged at the New York Exchange, the Dow Jones industrial average had lost 391 points, or 3.5 percent, to finish under 10,734. The NASDAQ gave up 82 points to end at 2,455.

Overseas, after Asian stocks fell on weak manufacturing reports, European markets sank to 26-month lows. The German DAX fell almost 5 percent. And the main French index dropped even more, 5.25 percent.

A fund manager in France cited multiple causes.

JULIEN QUISTREBERT, KBL Richelieu (through translator): First of all, there was last night's expected decision from the U.S. Federal Reserve. So the lack of surprise created a lack of support on the market. There was also some other negative news, like the downgrading of some American banks' debt.

JUDY WOODRUFF: That Federal Reserve decision will shift $400 billion into long-term securities to lower interest rates and boost investment and spending.

Just as important to investors, the Fed underscored long-term risks that may delay a complete recovery for years.

In Washington today, Treasury Secretary Tim Geithner agreed, the U.S. faces a combination of economic problems.

TREASURY SECRETARY TIMOTHY GEITHNER: But the two other clouds still over us are the European crisis and the deep concern you can see across the world and around the country about whether the political system in the United States is up to the challenges we face, not just the near-term challenges of supporting an economy still healing from crisis, but the long-term challenges of growth and competitiveness and fiscal sustainability.

JUDY WOODRUFF: But Speaker of the House John Boehner complained the Fed's new stimulus efforts will make things worse. Republican leaders had warned against any such move.

REP. JOHN BOEHNER, R-Ohio speaker of the House: We continue to have concerns with the activities of the Fed, because it appears to us that they're taking actions because they don't believe the political system can do what needs to be done.

Frankly, I think that's enabling the political process, rather than forcing the political process to do what it should do, and that's to deal with our deficit and our debt, which is imperiling jobs and imperiling the future for our kids and grandkids.

JUDY WOODRUFF: Meantime, the president of the World Bank, Robert Zoellick, acknowledged that kind of fear for the future, even though he doubted that a new downturn is coming.

ROBERT ZOELLICK, World Bank: I still think that a double-dip recession for the world's major economies is unlikely, but my confidence in that belief is being eroded daily by the steady drip of difficult economic news.

JUDY WOODRUFF: Some of that difficult economic news continued in Greece, where protesters staged another 24-hour strike against new austerity measures. Greece needs international bailout payments, or it will run out of cash by mid-October and face default.

"Markets Plunge Despite Latest Fed Efforts to Prop Up Economy" (Part-2)
PBS Newshour 9/22/2011

ECONOMY - Global Markets Resonate U.S. Volatility

"Tepid Economy at Heart of Global Market Volatility" PBS Newshour 8/3/2011

Excerpts from transcript

JEFFREY BROWN (Newshour): It was another rocky day on the markets, with a fearful beginning, but a more positive end.

The Dow Jones industrial average was down more than 160 points this morning. But, for the day, it gained more than 29 points to close at 11,896. The NASDAQ rose just under 24 points to close at 2,693. The S&P 500 also rose slightly, avoiding what would have been its longest losing streak since the peak of the financial crisis in October 2008.
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JEFFREY BROWN: Wall Street's sharp drops yesterday were felt worldwide overnight and into this morning. Asian stocks fell amid increasing pessimism over weak economic prospects in the U.S. European stocks also fared poorly amid continuing debt problems in a number of nations, including Italy and Spain, where bond yields surged to 14-year highs.