comments >> you meant financial system, correct? >> yes >> well, i think the large financial institutions that are at the heart of our financial system proved resilient. they did and they have been able to keep lending and their capital levels have actually gone up during this period. as i mentioned, their liquidity levels is. so i think that the work that we did over the course of the last decade and then and some has held up pretty well so far and i expect it will continue to >> thank you, mr. chairman thank you. >> thank you, senator warner senator rounds of south dakota >> thank you, mr. chairman chairman powell, it's good to see you again and appreciate you being with us today. i'd first like to ask about the slr exclusion that is set to

expire on the 21st the temporary patch allows banks to exclude ultrasafe assets, u.s. treasuries and the fed fund their balance sheets this is important in preserving bank liquidity and since the fed can't go bankrupt and the treasury never failed to meet its obligations. we all agree the economy is in need of fiscal and monetary support. they say the banks should be doing more to help the workers and our broader society. but they can't do that when we are tying their hands with excessive and challenging capital requirements it would appear congress is going to create even more financial flooding, flooding the economy with 1.9 million in new money banks will have to hold capital against as soon as the treasury starts writing the

checks my question is, would you agree it makes sense to seriously consider extending the slr exclue, given the failures congress are taking to facilitate our economy to recovery >> so i do think the slr exclusion. i know it expires at the end of march. we haven't made a decision on what to do we're in the middle of it right now. so i'm going to have to say we'll be making a decision and announcing that pretty soon. >> i think the reason for my question is, that i think the last time around and in the past, we've had challenges with banks that have come in and said, look, we got folks that want to bring their assets in. they got to have a place to put it it is liquid is what we will have most certainly, that has impacted our ability and the reason for the slr in the first place. it seems as you talk about it

and continue to discuss it, you keep an open mind on the need for that as this amount apparently will be put into the economy in very short order, so i simply bring it up in saying i think there is a lot of us that think that will be an important part of the discussion to have >> so let me read into a question we have been monitoring an increase in treasury yields when the market closed yesterday. i understand this reflects a view of an improving economy, also comes from increased borrowing costs and a move by the fed to increase interest rates down the line. how do you view the increase in treasury yields in the broader context of our economy at this point? >> so, first, we look at a broad

range and that's one incident. but really, we look at the whole conditions and it's very important to ask why are rates moving up? so if you look at why they're moving up, it's to do with expectations of a return to more normal levels or mandates consistent inflation, higher growth, opening economy. in a way it's stating confidence on the part of markets that we will have a robust and ultimately a complete recovery so those are the reasons that are behind that, i would say >> great thanks look, we follow the markets. we follow it on a regular basis, whether the markets are moving up, down, so forth i think in anticipation of what it will be the market was rather volatile i'm curious, when you walk into an opportunity like this, where you are sharing your thoughts, i know you want to be very careful

in terms of the message that you send, i think you do a good job of being very careful in the way you send the message let me ask, in your opinion when you prepare for this type of discussion, knowing the markets are literally watching everything you say what's the message that you'd like to send are you talking, we're going to have stability it's going to be steady as she goes we don't see changes coming up with regards to the availability of capital we don't see changes that will impact what's the message that you really want to send as you share with us today and are expected to be in front of our communities. >> i guess i'll say a couple things first the starting point is we're 10 million jobs below where we were in february of 2020 10 million payroll so there is a long way to go many of those jobs are concentrated in the lower end st income spectrum as i mentioned

many parts of the economy have recovered. in the bottom quartile, it's in excess of 20% we think so there is a long way to go monetary policy is accommodative and continues to be accommodative. we put forward guidance on both our asset purse and our rates. we think that that forward guidance is appropriate and we're going to -- you can expect us to move patiently over time as we see better data coming in. right now, we've had three months of 29,000 jobs a month. it's not very much progress. we expect such progress, which we had earlier last year we expect that will begin to return in coming months and expect us to move carefully and patiently and with a lot of advanced warning >> thank you, mr. chairman, i apologize going longer on my talk. >> thank you, mr. chairman so our economy is suffering

through a k-shaped recovery where the wealthy are doing better and better while working people are doing worse and worse. chair powell, you have been pretty vocal about inequality over the past few years. you've noted i think have a a quote here, it's been a growing issue in our country and in our economy for four decades you've talked a lot about how inequality undermines opportunity and mobility and you've described it as something that holds our economy back so i take that from these comments, you believe that inequality weighs our economy down and stumps economic growth is that a fair statement >> yes, it is. >> good. >> i agree with you on this. and the fed's own data spell out the problem. i think you were just talking about it you know, the top 1% of families last year received 20% of all

the income in this country and you think that's not good for our economic growth overall, is that fair >> well, i would say that the stagnation of incomes in the lower income area and also the low mobility that we've seen, those to me are the two most important things that i focus on when i talk about inequality a. nation of incomes and low mobility. >> we are talking here income and equality how much people earn each year to pay the rent and put food on the table. inequality shows up in wealth, which is what families build over time, money in the bank, home, stock, wealth and equality is even more extreme in our nation than income equality. who ill the top 1% of families a tiny slice bought 20% of all the income earned last year.

the top 1% held 33% of the tota wealth in this nation. now this pandemic is making inequality worse unemployment as you just noted is now at about 20% or the bottom quartile in this company. people are making a choice of putting heat on or food on the table. meanwhile, the wealth of america's $660 billionaires increased by 1.1 trillion over this past year inequality is felt another way it's felt in how people pay taxes. the 99% in america pay on average about 7.2% of their total wealth in taxes in a given year but the top .1 of 1% pay only about 3.2% that's less than half as much. chair powell, does it increase in equality when the wealthiest

americans pay total taxes at less than half the rate of all american families? >> these are, you are getting farther and farther from the kind of inequality we focus on frankly, we can't affect wealth and inequality and certainly in the short time, we can affect indirect income by doing what we can to support job creation at the lower end of the mark, so i leave to you those are crystal policy issus that i wouldn't put those with a band aid that's all. >> i appreciate you are trying to move sideways on this, but you have pointed out inequality is a problem in our country, that it holds that mobility. that opportunity i point out that inequality is felt not just income but wealth

even more so and that our tax structure makes that worse over time extreme wealth and undermines our economy as you have said it undermines justice and our democracy and our tax code focuses almost entirely on income and lets most of the wealth as the ultrarich families had accumulated just slip right on through that just seems as to me not ri right. >> a 2 cent tax on fortunes worth more than $50 million. if fortunes own a billion pay a few more sense this wealth tax will let us address the inequality that you have been very worried about as chair of the federal reserve it's how we have a chance to level the playing field and build an economy that works for everyone so thank you for being here, mr. and thank you, chairman brown.

>> thank you, senator warren >> senator from north carolina >> if not, senator kennedy of. >> reporter: >> yes, sir. you hear me, mr. chairman? >> i can't, senator. we have two mr. chairmans here. >> yes, sir. >> mr. chairman, the witness what was our fourth quarter gdp gro growth >> i don't have. i'm reluctant to guess, but it was in the i want to say 4%. >> right that's what my numbers show, too. what are you and your economists estimating that our gdp growth will be for 2021 >> so we -

>> well, that's going to be something we're going to have to deal with in this new era of zoom we are watching the senate banking, of course, the fed's chair responding to senator kennedy about gdp. a pretty extensive discussion, not just about inflation and what he believes will be more volatile periods of inflation over the next year or so although he added rising prices will be a good problem to have growth affects later in the summer according to powell, a cooling momentum for the end of the year harmly talked about the idea that price increases will be not as persistent as some in the market believe it to be. although mass vaccination hopes are among us, the job in his words is not done yet. as he said earlier, inflation habits change but they don't change on a dime

i think we might have senate banking back let's take a look. do we? >> we do not have it back yet. we are joined this morning >> i was answering the question. >> okay. we got it back >> right here's what i'm getting at you have strongly encouraged congress to pass another coronavirus to $3 trillion i just, tell me if you could in just a couple of sentences why you think we need to do that if we're looking at 6% gdp growth this year and as soon as the end of this month we'll be back where we were if fen february, 0 >> i have consistently not taken a position on this bill. >> so you don't have an opinion about whether we ought to pass

president biden's bill >> as i've said since the december press conference i think on every public occasion when i have been asked about it, i've said it's not appropriate for the fed to be playing a role about particular provisions of particular laws. we didn't comment on the tax cuts and jobs act. we didn't comment on the c.a.r.e.s. act you know, it's not our role. >> okay. >> so your opinion is we don't pass the bill you're cool with that >> that would be expressing an opinion. that's what i'm not doing is expressing an opinion. >> would you be uncool with that >> i think by being either cool or uncool, i would be expressing an opinion >> okay. how do you think we ought to pay all this money back that we already have

>> i think that we will need to get back on a sustainable fiscal pact the way that has worked when it's successful is just get the economy growing faster than the debt i think we will need to do that and that's going to need to happen it doesn't need to happen now. >> do you think we august to go on the bud catwoman on the budget >> i don't know that term catwoman on the budget i think we need to do it so the economy is growing faster. in nam nal terms then and the debt will have to, eventually. on the path we're on >> well, do you think the deficits matter? >> certainly in the long run, i do believe they do >> you don't think they matter in the short run >> again, i think we will need to return to -

>> this, we need to return to this issue, but i wouldn't return to it now and the way to get after this issue is to get a situation where the economy is growing faster in nominal terms than the debt is >> yeah. >> what if that becomes the case that your spendings are growing faster than your economy >> well, no, that is the deficit. the question is the deficit is the difference between intake and spending >> let me stop you, mr. chairman, because i'm going to have one last question quickly, into the money supply, it's up i think about $4let his over the past year are 6 trillion, 4 trillion, 6 trillion, what's a few trillion it's up 26%. the highest amount since 1943. what does that tell you? >> well, when you and i studied

economics a million years ago the mon tairtarily seems to have a relationship to economic growth right now i would say the growth of m2 is quite substantial, it doesn't have important implications m2 was removed some years ago from a standing list of leading indicators it's just that classic relationship between economic growth and the size of the economy, it just no longer holds. we've had big crest of monetary aggregates without inflation, so it's something we have to unlearn i guess. >> thank you, sir. >> mr. chairman. >> senator cortez mastoff from nevada >> mr. chairman, thank you, thank you, chambers. chairman powell, thank you again for being here as usual. i so enjoy listening to you in the conversation so far. let me bring up a subject that you and i quite often talk about

which is nevada and the president service industry as we all know has been so hard hit. we have a second highest unemployment rate in the nation. in this type of labor market, there is no upward pressure on wages. when people are desperate for work, they are willing to take lower jobs when the unemployment rate is low, employers are able to raise wages for in-house training and retraining >> can i ask a question? how does a tight labor market encourage lawyers to invest in in-house training? do you have an thoughts or answers to that at all >> i do. as we discussed, we met last couple of years when unemployment was routinely below 4% as low as 3.5% and where labor force participation was high, had moved up, actually, despite expectations that it wouldn't we saw lots of virtuous effects

in the labor market. we talked about it weeks ago one of them was you saw employers investing more in training we saw employers looking for margins. employers were going to prisons and you know getting to know people before they came out and giving them jobs as they came out, great things happening from a tight labor market i just think we saw that and that's why one of the reasons we're so eager to get back to that, consistent with also maintaining price stability. but we really do think and others saw the same thing we did is the societal benefits of a tight labor market >> wouldn't you agree eta congress' investment and work force development and healthy developing those skills that that work force would be important? >> i do. i don't want to comment. i'm not entirely sure what you

mentioned was in the current proposal but i would say the kind of investment that impede people in the labor force and policies will enable you to take part those are big things that can increase the capacity of our economy over time. >> i agree, that's why i introduced the worker's act, the pathways act many of my colleagues are focused on this investment, particularly now when they have opportunity to have a long-term impact on jobs so thank you for that. it jumped to just the unemployment and this is an area that i know we are really hard hit. we have to do more to turn this economy around in our hospitality industry but let me ask you this. if congress does not extend unemployment insurance, what is the federal reserve's economic forecast to on communities like

los vegas that are dependent on travel and hospitalitys? >> so again, i'm not going to comment, unemployment insurance is a part of the bill. i will stay away from the current discussions that have to do that. the single-most important thing for your service sector employees is to get the pandemic behind us so people can get on the airplanes, take vacations, that's the single most important economic growth thing we have that, after that, i think they'll be, it's possible that that will begin to happen relatively soon and get people vaccinations, and people do the right thing with social distancing you can see that happening relatively soon, which is great. >> you would agree, there the an investment that needs to be made we are not done here at the federal level with our monetary fiscal policies. it's one thing to get the

pandemic under control it's another to understand how we turned the economy around as well, would you agree? >> i would agree so we, as i said, we will keep our policy accommodated we think we have a significant grow under to cover before we get close to maximum employment. we hope to do everything we can to speed that process. >> let me say one final thing. you said it is the pandemic that hit state after state in the communities. i hope we do not shift leaders here about making investments when some states turn around and put them in particularly in the service industry, no station left behind. i hope we will all do that, that we pull everybody with us as we address this pandemic and start to turn the economy around so forth i know my time is up

i will submit the rest of my questions. chairman brown has had to get over to the senate finance to ask a question he will return so i am going to sit in his chair temporarily. i will go ahead and turn the gavel over to senator -- >> thank you, senator cortez and i want to say a thank you to chairman brown and ranking member toomey as well for holding this hearing today as we work towards full economic recovery it is noted. this is an important oversight chairman powell, i want to thank you for your time and your martis pacing today more generally, i want to thank you for your leadership of the fed as we work our way through this crisis i want to say this, mr. chairman, i am very encouraged by the indications from the monetary policy support to coordinate as we come out of this downturn, we're looking at

potentially north of 4% economic recovery or as you and senator kennedy were discussing, maybe 6% growth for 2021 i find that encouraging, albeit an uneven recovery i feel it's very good news we're on the way that also raises concerns that i have i am sure it has been discussed many, many times about the amount of liquidity that wear going to continue to pump into this economy we have already allocated $4 trillion in coronavirus recovery relief 1 trillion yet to be spent now we are talking about putting close to an additional $2 trillion in the economy. i won't belabor this it's been discussed. i am sure they have injected liquidity at a time we are in the process of recovery, particularly noting a slow recovery after the 2008 recession given the amount of --

benefit. chairman powell, i'd like to shift gear force a minute. yesterday, treasure secretary yellen talked about the fed and changing technology. something she said - >> senate banking clearly needs to do a little touchup on the technologies continues to be a little troublesome at large, the hearing does have powell calming the fears of rising inflation a bit of a discussion about budget deficits. he does point out that he has no intention of repeating the inflation with the states of the 1970s, but the time to think about budget deficits is not now. >> yeah. i think some questions there specifically that delve into economics and the question of deficits trying to avoid talking

about specific bills here. but sheer chairman powell speaking again >> the efforts to create their own quasi-money type of instruments. so there are significant both technical and policy questions to do with how we would go about doing that and i would say that we're committed to solving the technology problems and consulting very broadly with the public and very transparently with all interested constituencies as to whether we should do this i will say we are the world's reserve currency and we have a responsibility to get this right. we don't need to be the first. we need to get it right. and so, but this is something we are investing time and labor in right across the federal reserve system you may know boston has a partnership with mit we're doing research here of the

board. >> it does hold out the prospect of the things that you mentioned, very positive it could help us with financial incrucian as well, at the same time you want to avoid things stabilizing or the funds from the banking system we have a banking system for borrowers. we want to be careful about what the implications are so very high priority project for us. >> i share your concerns on the need to be careful i also appreciate the fact that you will stay at the leading edge of looking at this and making certain that america does not fall behind in any respect in terms of maintaining our status as the world's leader for reserved currency. two a moment of time left, i want to follow up on a more technical comment regarding the importance of looking hard at the xlr exemptions as we move forward this year. i know they come to the expectations at the end of march. i very much appreciate you

taking a hard look at that moving forward there is a tremendous amount of liquidity coming in. on inflation, we talked about disinflation, at the same time i shared senator toomey's concerns about theasset bubbles we are seeing that occurred here in america. i appreciate your role in taking a very steady hand in monitoring inflation and making sure we stay on top of it. thank you very much, mr. chairman. >> thank you, senator. >> next i'm going to call on senator van holland. i know senator brown used question finance i will have to question and pass this gap to senator van holland. thank you. >> thank you, senator cortez masto. welcome mr. chairman, thank you for your service at the outset here, i just want to underscore the fed continuing to move ahead with the fed now

service as we've discussed in previous hearings, the united states' outdated payment system is inflicting large and unnec unnecessary -- quaths on funds spent. this doesn't impact people with big bank accounts who are not close to overdrawing it impacts those living paycheck-to-paycheck so i see that the fed has accelerated its time table a little bit to 2023 if you can move even faster, automatic better, you will be saving millions of americans lots of money and unnecessary costs. i want to focus my questioning on the issue of long-term unemployment and in a speech you gave on february 10th, you pointed out that the unemployment rate would be close to 10% if you adjust for the

bureau of labor statistics clarifications and people who dropped out of the labor force since the pandemic this includes over 4 million americans who are accounted in the unemployment figures but are long-term unemployed and millions more who have dropped out of the labor force during the pandemic but we'd like to get back into the work force and you noted in that speech the concerns of persistent and strategy from persistent long-term unemployment what it inflicts on workers personally and their families and the negative impact on productive capacity for our entire economy you stressed that mon they're policy alone can't do this it requires a fiscal response. so here's my question. beyond the overall impacts that the bill were before us or other

fiscal response will make in terms of increasing overall economic growth, based on your experience, would you agree that it's important to very intentionally develop policies to help the long-term unemployed, of individuals who even during good nick times were unable to get into the work force? >> i do. and this really isn't a longer-run thing i would say but it's particularly relevant now. industries are always you know growing and shrinking and workers are moving from one industry to another. that's just a market-based economy working. in this situation, you have that accelerated in a big way and so many of the people, we may find that many of the people who are not going back to work or not back at work now may really struggle to find jobs. because businesses are being automated. we hear that all the time

computers and automated answers are becoming more and more common so i think those people are really going to need help to get back into the labor force and get their lives back and that will take i think the kind of investments you are talking about. >> i appreciate that and we're talking about a focus and an intentional investment beyond the investments that we're making for overall economic growth. right? >> yes and i also wanted to turn really quickly to the importance of using the right kind of economic measurements to determine the well-being of american workers and families as you noticed in that same speech, unemployment among low-wage workers is 17% where it was at the start of the pandemic, where as among highway

workers it's down 4% so if you take the average, are you not seeing the impact, the disproportionate impact on low wage workers i often give the example that if jeff bezos had moved to baltimore city last year, the per capita income of baltimore city would have gone from $53,000 per person to $175,000 per person even though nobody was better off individually so what should we be doing and what is the fed going to be doing to make sure that as our economy improves, which we all want it to do quickly and we don't overlook the continuing paying people or because we are looking at averages, and not looking beneath those averages, these people who are struggling in that way are doing so because

they were employed in the public-facing jobs in the service industries so clearly the number one thing we can do to get them back to work is to get the pandemic behind us. that's not something we can work on here at the fed but that is the top thing. beyond that, i just think it's up to us to continue what we can do to support the economy for really with some patience in order to, so that they'll have time to get across we've talked about a bridge. most americans will have a bridge, but there is a group that will really struggle. i think we need to be mindful of that, really, they did nothing wrong. this was a natural disaster. as a country, we set out to provide support. >> my hope is that the fed releases its numbers going forward, in addition to the aggregate average numbers, you also continue to provide us with the impact on lower wage individuals. thank you, mr. chairman, senator

til tillis >> and if senator tillis is not with us, senator looms >> and if senator loom sis not with us then mr. chairman, as senator tillis may-- senator mon >> thank you, mr. chairman mr. chairman pro temme and chairman powell, thank you for the opportunity to visit with you today and thank you for your work with the fed just a broad question, how do you view your job in

relationship to an administration so a change in administration from one president to the next, what does that mean at the federal reserve from your perspective? anything or a lot? >> well, our job doesn't change and at the very beginning of the administration, our, the personnel don't change of course, the one way that administrations really interact importantly with the fed is with appointments so those will happen overtime. but the second thing is, you know, it's a different group of people we have ongoing relationships by long-standing practice with various parts of the treasury department and also to a much more limited extent with the white house and we make reasons and continue to have the same sorts of discussions but ultimately, the answer is nothing really thchanges becaus

of the election and the people. >> thank you for your answer during my time in the senate banking committee i've been an advocate for an independent fed. i want to fed to make decisions based on best policy without significant political interference, other than perhaps the senate banking committee, 18 tame we can take that opportunity. let me ask a specific question the most recent monetary policy report to congress, the central bank indicated i quote, they appear susceptible to sharp decline particularly if the pace picks up or in the longer-term, the pandemic leads to permanent changes in demand i have great concern for commercial property markets and would like to hear what your thoughts are is this something we need to wait out? is this something that needs

more attention than we have been able to provide in c.a.r.e.s. or covid relief before and what does it mean to cnbs borrowers in this market with this market >> well, some parts of commercial real estate office, hotel, and some maybe retail to some extent are under real pressure because of the pandemic and those changes may be lasting or they may be temporary or somewhere in the middle so this is something we are keep ac close eye on there is significant exposure in cnps to i think the hotel space, in particular. so, we watch these things. of course, as i think you also mentioned, the single best thing to happen is to have the economy recover quickly, so offices and

hotels can be filled up again. where it relates to offices or more people will work remotely, so will the demand for office space be feeling downward pressure for a while or the long run. that's very possible we don't know that if you talk to, we had a presentation a couple weeks ago from someone that had a survey that suggested that there may be sort of a sustained lower demand for office space, in particular. so those are things we watch very carefully we watch it through the banking system and to see whether, most banks are okay on that most have a concentration on cre, so we watch that carefully. >> mr. chairman, thank you very much i yield the balance of my time >> thank you, senator more ran senator smith. >> thank you, mr. chairman

can you all hear me? i snow senator tillis is having a hard time with the audio >> he can hear you. >> yes, thank you. >> chair powell, it's great to see you today. i want to start by asking you a question around climate risk and disclosing climate risks you and i have discussed the climate change remains the most chall challenges we face it cuts across our entire economy. it's i think in some ways like a slow-moving pandemic and, of course, it poses a real risk to the banks that the fed regulates. so i know that in december and i think it was a great idea that the fed join the network, excuse me, of central banks and supervisors greeting the financial system i think that's a step in the right direction. my question guess to this. a lot of climate risc is mostly

voluntary. it varies a lot from company to company, it's hard to compare risks or interpret with wha those disclosures mean so would you talk to us about whether or not you think climate risk disclosures should be standardized or should we continue to allow firms to sort of make their discdisclosures. if they make them in whatever form they choose >> sure. if you percent me, i'd like to say the overall response to society and climate change i agree is a very important problem has to come from elected officials in congress and also in the executive branch under existing laws. so that's really where this comes from. >> i agree with you. >> we have a specific role on climate change, which is only the extent of the cope of our mandate, which is to insure the resilience to the institutions we regulate and supervisors. on this disclosure this is an sec issue

i would say in general, financial discussions everywhere are particularly the larger or medium-size ones are working hard on this question. there has been a lot of work done with the task force on climate financial disclosure and other groups and you know are struggling with this question of different kind of disclosure, that varies by jurisdiction and by substitution. i do think that it's appropriate to allow some of that difference to persist for now in the long run, clearly, we ought to be going to, you know, kind of a template and more standardized but i think, it seems to me, we can let this process, which is very much ongoing now among our own financial institutions, we can let it bear fruit for while. we have to be going in the direction. >> so some sort of mosque towards a more standardized reliable, comparable, kind of standard of disclosure makes sense to you >> yes, it does, over time. >> thank you

thank you. >> i just want to also just loudly agree with you that this is primarily an opportunity for congress and the executives into evidence to step up and take the steps that we need the take from a policy perspective so i agree with you on that. let me just one other thing i'd like to ask you about. there has been a lot of conversation about the unevenness of the economic recovery and how that's affecting people differently i'd like to hit on one point about this last week i think it was the minneapolis fed came out with a report looking at recovery, people recovering their employment and revealed in minnesota and in the minneapolis fed district, a dramatic kimpbs in women rejoining the work force, or not, a dramatic difference between women and men and particularly even particularly a difference between lower-wage women workers and higher-wage women workers. this is a huge challenge, because in many parts of my state we have a work force

shortage it's an economic challenge as well as for families that lost that really significant wage owner. so, sheriff, could you talk about the unevenness, the women returning to the pork kwors and how you see that affects our economic recovery? >> sure. so we know that with the closure of schools and with home schooling, you know, parents have had to stay at home that burden has fallen significantly more on women than on men and next, they've had to involuntarily withdraw from the work force and that will hopefully, that will be temporary to the extent people want to return to the work force but that interrupts your career and it may be difficult to get back to where you were in the work force and replace that work life that you've had and sort of limit your ability to contribute to the economy so it's important and again,

it's not really our policies that can accelerate that but policies that bring the pandemic to an end as soon as possible will help and allow us to open the schools up will help are you right, there have been disproportionate impacts and that's one of them. >> i know i am out of time i want to toss in there. one of the key pieces of infrastructure to work for women is a child care system that the there, so that their young children can have a place, affordable place to do go. this has been a collapse on the child care system during the pandemic and something i hope to continue to work with my colleagues on and in congress. thank you. >> thank you, senator smith. senator tillis >> senator van holland, can you hear me? >> i can hear you. we can hear you. >> i had to reboot my pc sorry about that thank you for your indulgence, thank you for being here and the time we spent on the phone a few weeks back.

we have 210 million adults, americans over the age of 18 in this country and now we're at a run rate of about 1.7 million vaccinations a day now that we've had the wagon january, the first and second vaccination so i think in answer to senator or chairman brown's question, you said the most important thing we can do is ac sell rate the vaccine. now we're on pace of having well over half of the country for people who want to take the vaccine, vaccinate it by let's say june, early july time frame, back when you and senator or i'm sorry, treasury munuchin passed us, it was over 900 billion and we were talking about a bridge and in your opening statement, you also talked about an object michigan outlook in the second half, if we continue to make progress on the vaccine. i'm not financial to ask you questions about the fiscal

policy that we're dewitting and the $1.9 trillion package, but i am curious if at least a high level, do you think it would be prudent to make sure that the additional money that we expend to continue to provide that bridge or build that bridge to recovery, should it be spent on things that are truly still lative do you see still lative value, for example, money coming from the federal government that ultimately makes it into bank accounts not back into the economy on a short-term basis? >> i don't think i want to comment on the particulars of the bill clearly, some kind of support have higher multiplier effects people who get the money have a different marginal propensitys to consume >> the question i wanted to follow up on a question that senator more ran asked about cnbks in particular, with the

eviction and foreclosure moratoriums, ultimately sun setting and with the cncnbss, being linked to plans, who proactive stems should we consider as a matter of policy or can you take to avoid what may be some tough waters for that space of investments in the probably coming year >> we don't have, you know, the kind of tools that we have are not really appropriate for addressing those situations, unless they become extremely broad. i wouldn't expect that would come down to whether you wanted direct assistance >> let me get back to one other thing on asset bubbles i'm sure are you familiar with president ford's comments about his relief he doesn't see

particular risks or bubbles. do you share that view >> i wouldn't count on you know what one of my colleagues so so i guess what i would say to this we look at the really broad range of things. we talk about financial assistant we got how much leverage in the banking systemse look at funding risks and asset prices and the thing i always get asked about are asset prices and they're only one thing ultimately one thing is a situation where asset prices where movements in asset prices do not disrupt the broader financial system and i think we have highly capitalized banks and we've done a lot to shore up the parts of the financial system that didn't hold up during the prior crisis. i wouldn't comment on any particular troubles. no one can really identify them. for any particular asset, even now, people have different perspectives, and in the equity market there are some who say there's a bubble and we don't

have -- i don't have an opinion on that for this purpose >> final question, i can't see the timer, so i don't know if i'm out of time. i'm close. i think senator van holland mentioned the payment system what's the current status of the implementations, relative to the guidelines for implementation and pricing? >> we are right on trend and feeling like we'll be up and running in '23, and that's good. we said it would be '23 or '24, and now we're thinking '23 and that's really good it's a project that overall is very much on track i don't have anything for you on price, but it's on track. >> i look forward to reaching out and maybe speaking with you all about the implementation and some of the issues on pricing which have been a concern of mine thank you, chairman powell >> thank you, senator. >> thanks to senator van holland who was voting on taking committee. the senator from arizona

>> thank you, chairman brown and thank you to ranking member toomey for holding this meeting and chairman powell, good to see you. thank you for joining us today when i hear from arizonans the first question is not about the federal funds rate and not about the dual mandate or the money supply curve because right now ariz arizonans want to reopen our schools safely so my hope is that we'll get critical relief and -- [ no audio ] to think about the future and not just the present crisis. we want a strong, economic recovery and that means ensuring the fed work compliments the legislative, forts the federal open market committee quote, it would be

appropriate to maintain the accommodative target until labor market conditions would reach levels consistent with employment and is on track to moderately exceed 2% for some time so the fomc summary of economic projections from december showed that most members' projections of the unemployment rate lie between 3.9 and 4.3% does that mean that the fomc will not view the u.s. as having reached consistent with maximum employment until the unemployment rate is 4.3% or less >> yes, it means more than that, too. when we say maximum employment, we don't just mean the employment rate, we mean the employment rate and we mean it as a percentage of a population which also takes onboard relatively high levels of participation. we look at wages we look at many things and a broad range of indicators. >> i see

now the statement lists three conditions for raising rates full employment, 2% inflation and projections of 2% plus inflation. are all three of these necessary for the fomc to consider raising its target for the federal funds rate >> yes, they are >> oh, thank you that's very helpful. i appreciate you clarifying all of that for all of us. as we build to re-open the economy and re-open safely we will see pent-up demand in the hardest hit sectors on hotel, tourism and restaurants. as you know, pent-up demand can cause sector-specific price inflation and it is very different than persistent economy wide inflation so taking overly aggressive action on a short-term, limited problem risks cutting off relief before it reaches arizona families and that's because such action would increase interest rates on student loan, mortgages and other household debts when

families can be supported. what tools would the fed utilize to ensure that you effectively distinguish between temporary sector-specific and the real deal >> we are aware of the history of inflation and how it got under control and how it got out from under control i would say looking at the current situation we do expect that inflation will move up in part of what you mentioned which is enthusiastic spendsing as the economy re-opens and we don't expect that it will be particularly large or persistent particularly from a sort of one-time amount of spending due to the current situation, so we'll be watching that carefully to make sure that's right, but we'll be doing that patiently, and we would expect that the longer run inflation dynamics that we've seen for more than a quarter century where inflation

expectations are grounded and inflation doesn't move up in bad times and we think those won't go away overnight. we think they'll persist they may well evolve and we would expect inflation to perform somewhat in keeping with the history of the last few decades. >> thank you, chairman powell. again, i appreciate you being here today mr. chairman, let's work together to get the economy back on track and ensure that everyone benefits from this recovery thank you, and i yield back. >> thank you >> all right thank you senator sinema senator from wyoming is next. >> thank you, mr. chairman chairman powell, thanks so much for appearing before the committee today. i have two questions first one centers on energy. as you know, demand has dropped for energy since the pandemic started, but economists are projecting greater demand later this year and into 2022 even

while production declines under the current administration's actions to restrict oil, gas and coal development my question is this. are inflationary risks weighted to the upside or down side if a demand shock occurs and reduced production cannot keep up? >> for a long time --for a lon time the situation you described, let's say hypothetically that it does push up energy prices in the near-term that would -- that would move through headline inflation, but it wouldn't necessarily raise prices and it wouldn't change the rate of underlying inflation >> would a balanced energy approach, more balanced than we are looking at right now be more appropriate until the supply returns to normal?

>> i -- i don't -- we don't really take positions on energy supply those are issues for our elected representative, notably including you, and i know you're an expert in the energy space. i'll switch my questions then to innovative payment instruments the fed now and other instruments like stable coins and central bank digital currencies have the potential for much higher monetary velocities so how will this impact the monetary transmission mechanism and collateral availability in the markets? >> well, we don't think that -- we don't think they'll have much of an effect on monetary transmission, actually we've had tremendous amount of payment sector innovation for a long time, really, and monetary policy transmission continues to be about what it is. we change interest rates and

that works its way through the economy and that supports economic test and restrains it and we don't think there will be a tight connection between now and the stable coins in the world. i would agree with you, it's important to have collateral and what we see in the markets is -- is far from a shortage of collateral there seems to be ample collateral if you just look at the rates that are being paid. >> could higher velocities from inon vattive payment instruments lead to a refocusing of the monetary transmission mechanism away from the securities markets and towards a more of a bank-focused transmission mechanism based on demand deposits >> again, we don't see -- the premise might be right we don't think there's much reason or evidence to expect the

showing that -- that these innovations will have much of an effect on velocity or on transmission, for that matter. we should talk about this online it's a very interesting question, actually we only see the premise, but i'd love to hear more. >> i look forward to those conversations. one more question. do we need a central counterparty for the clearing of treasurys? >>. >> interesting question and that's a proposal. we're doing a lot of thinking these days along with colleagues of other agencies about the structure of the energy market given what happened during the acute phase of the pandemic when there was so much selling pressure and there wasn't the capacity to handle it and one way to do that would be to have central clearing and it certainly has benefits and i've been a big fan of central clearing in other parts of the economy and it's something that we're looking at i don't know that it will wind