and i'm sure many of you read president putin's long at the time of the syrian conflict, where he was saying the only thing we have between the world and the abyss is the rule of law, the sanctity of borders, the centrality of the u.n. security council. international law is the only basis on which to conduct human affairs. orwellian does not begin to describe it. >> doyle mcmanus from the "los angeles times." i would like to sharpen the question on what the united states is prepared to do if the ukraine says it is prepared to resist further russian incursion into its territory from the east and south. it seems to be a bit of a

chicken and egg problem here. their decision on what they are prepared to do may depend on their understanding of how much support they have. dr. brezinski, you suggested that mre's are not quite enough. we can provide nonlethal equipment him a lethal equipment, and air cover. there is the escalation. what should we do? >> in any case, we should have contingency planning for all of that post up but we should couple that with a serious communication to the russians in which we would like an alternative outcome in which we would like to be partners. but we need to let ukraine know that if they resist, they will not be alone. we do not need to let the russians know exactly what we are going to do.

but the death of the pudding is also in the ukrainians. they need to demonstrate that they value their territorial integrity and are prepared to make sacrifices to protect it. i think the russians, the way they have operated in crimea, what -- as i said before, where they are operating on a contingent basis. if there is a lot of resistance, we pull back. the same may happen in ukraine as well, particularly those district where there are some russian people living and they are demonstrating and so forth. the ukrainians themselves, first of all, have to take some clear positions regarding what they intend to do with some degree of credibility. otherwise if we don't do it, that i think we really are on the path to grievous instability and other acts totaling over two georgia. azerbaijan, the russians have a score to settle with azerbaijanis. there are large populations that

could be the object of several explosions with hatred and conflict. you open up the gate. our job is to reduce the scope of uncertainty by commitment and clarity and willingness to compromise on an intelligent level. but that also means the president has to take a visible position and speak seriously to the american people about the problem that we confront, that we and our allies confront jointly. and mrs. merkel's speech is a hopeful indication that more and more europeans are beginning to realize we are in this together.

>> anybody else want to talk about that? >> i have a question for all of the panelists. are you concerned that if the eu and the u.s. failed to take measures, will china be encouraged to do the same thing in its neighborhood? and secondly, [indiscernible] suffer from the crimean crisis? >> if i heard it all, i will start out. i think the chinese sympathies probably lag more with the russians. but i do not think they're going to enter, because they are logical on the issue of territories being shifted around, for example, to that.

i don't think you'll find the chinese standing up and shouting for the russians. >> anyone else? roger? >> in terms of the second part of the question, it is hard to understand exactly what was meant. it was a phrase and it has floated out there and there have been meetings about it. it is not altogether clear, to me, at least, what it has meant. but i think what president putin has presented the west with is a strong case for looking again at the transatlantic alliance, looking again at the defense budget, looking again at the fact that the european neighborhood is not so safe and secure that we can simply transfer our attention elsewhere. i think china has a very ambivalent response to what has happened.

it doesn't like borders changing. they have abstained. that is an indication. i do not expect a scenario of world war iii. i do not expect some chinese move on taiwan or something like that. >> right down here in the second row. >> i am from the iss. there is another country that has a common border with an eu member and a nato member, and which has an agreement with eu, and that is, moldova. it has its own crimea, which is now asking russia to become part of the russian federation. there is a game beginning out

between russia and moldova to get moldova to an agreement for an exchange of that being part of russia. what should we be doing now to prevent that particular domino from falling? because if it does, then you will have the problem for russia of territorial continuity between russia ministry and rushing crimea. and that happens to be the southern borderlands of ukraine. you may not have time to prepare that package of measures, which you told us about. if i may, just one remark. the leverage we may think russia has vis-à-vis us on iran and

syria, i remember -- and the panel were members, that during the cold war, we were able to cooperate on the issues of chemical and nuclear proliferation. that is not going to stop simply because we're going to have a big problem with russia. russia has permanent interests in doing on what is doing -- in doing what it is doing on iran. if we get into a new cold war, it is not going to stop russia from continuing to talk with us on iran. >> i agree with you on iran aspect. as far as moldova is concerned, there is another factor involved here, geography. if ukraine does not go the wrong way, the russians will not be able to pull that off. and if necessary, we and the ukrainians can deal with it. if ukraine falters, the problem is, of course moldova, but the bigger problem is ukraine itself.

that is the key strategic issue right now. how the ukraine's play at? how will the russians play it? what can we do to be clear-cut in our relationship with the ukrainian? >> american university in moscow. my question is for zbigniew brzezinski. what is your opinion on the nazi factor in ukraine? is a powerful? is immeasurable? or is it just russian propaganda? >> there probably are some neo-nazis, more accurately, in the ukraine. they are a very minor group. very similar in that respect to some neo-nazis in russia, who seem to be a little more visible actually, and even have a very prominent philosopher supporting them and instructing on that basis, mr. putin as to what his vision of the world ought to be. i think you know what i'm referring to.

>> we have not called anybody on this side over here. right there. look to your right. >> i'm mark seibold with mcclatchy newspapers. two quick questions. one, i'm wondering if any of you are surprised that putin moved into crimea. some people say we should have realized it all along, and others say, of course we were surprised. i'm curious what your personal situation was. there has been a lot of discussion about nato and how this finally brings nato back to having a purpose. i'm curious whether you think the initial response on behalf of nato and the united states sending up a half-dozen planes to poland, that sort of thing, if that is muscular enough to make an impression. >> roger?

>> i was not surprised in the endgame, if you like. i think the germans have very good antenna in russia, and i spoke to a senior guy at the foreign ministry there, i guess, two weeks before the annexation. he is a fairly prudent guy and he said, our impression -- and the foreign minister had just been to moscow. his impression was, he's going to go all the way. i don't think we can stop him. and i was surprised then. i said, really? and then i saw these moves that reminded me very much of belgrade and what i witnessed in belgrade. of course, the parallel is not exact. i was not surprised right at the end. in terms of the same question about the nato response, president obama is about to go

to europe. he is going to brussels, i believe, for the first time very soon, this month. the one thing i would say is that i think it is absolutely critical that there be -- that this trip be well-prepared and that there be a strong, united, vigorous statement about what has occurred. there was a mention, i think, in president obama's statement to article five of the nato treaty. but it came well down the list. i think it could have been higher up the list, just as i think the people sanctioned could have been of a more said gibbons -- of a more significant level. >> you, too, were you surprised >> yes, i was surprised. i was surprised how essentially nonviolent the russians were able to pull it off. it was well planned.

i was also surprised that the ukrainians there did not offer some sort of resistance. >> could we, should we have known about it? >> if we had paid attention, yes. but we were not paying attention. ukraine has had several elections. they have gone with the western part, the eastern part. timoshenko was put in jail. this is a country that has been troubled for a while. no, we have not paid attention to it. and i think we probably could have avoided had we been on top of the problem when it first started with the ukrainians and the eu. >> well, i'm sorry to say we have come to the end of our program. but before you go, we have one

other thing we have -- want to take note of. today is general scowcroft's birthday. [applause] [laughter] [applause] >> i'm sorry. i don't do birthdays anymore. [laughter] >> well, there is cake for everybody here and it will lead behind you as you leave. thank you all for coming and thanks from tcu. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2014]

>> just a few weeks ago, this house voted against funding for the contras. we decided against contra funding because we felt it was against american tradition to fund a private army whose goal is to overthrow another government.

we felt it was against american tradition to replace the strength of rds with the strength of our arsenal. a few weeks later, we are again facing a contra boat. -- vote. why? because daniel ortega went to moscow. i'm not happy about any nation turning to the soviets for economic help. but that does not change the contract issue. contra issue. farmer --ajority are former somoza men who never believed in freedom. a give them aid is perversion of american morality. the watch reports -- i will give you an example -- four months

killed at ashe was state owned coffee farm. she was wounded first, her face shattered by a grenade. a knife wound with the unborn fetus protruding. many other unarmed civilians were slaughtered by the contras with their throats cut during ugly. we must face this. sure there is violence on the left, to. but violence on the left and violence on the right must thought -- stop. it is not byop supporting a brutal army that wants to overthrow a government of a country the size of iwatch. -- iowa. but by doing what america does past. -- best. the way he to stop the violence

is to support the boland amendment. the hamilton amendment. let us not have the blood of the innocent our hands. let us not escalate the involvement of american troops. i say vote against the >> more highlights from 35 years of house coverage on our facebook page. america's cable companies 35 years ago and brought to you today as a public service. in a few minutes, janet yellen's first news conference. in a little more than a yeller -- our. , after that, the un security council discusses. him on re-air before national security.

on the next washington journal, a look at the role of nato with mark jacobson. the chief washington correspondent for yahoo! news to discuss foreign policy and how american residents have reached out to other world leaders. and we will focus on janet elin's plans for the federal reserve. washington journal is live on c-span everyday at 7:00 a.m. eastern. you can join the conversation on facebook and twitter. >> at the end of its today meeting. the federal open market committee says it will keep borrowing costs low. rate is noployment longer a target for interest

rates. get elin spoke to reporters. -- janet yellen spoke to reporters. >> good afternoon. i'm pleased to join you for the first fomc press conferences. like chairman bernanke before me, i appreciate the opportunity at this press conferences afford to explain the decisions of the fomc and respond to your questions. the market committee concluded a two day meeting earlier today. as you already know from our statement, the committee decided to make another modest reduction in the pace of its purchases of longer term securities. the committee also updated its guidance regarding the likely future path of the short term interest rates. interest rates. as i'll explain we're fully in the moment, this change in our guidance does not educate any -- indicate any change in committee

policy intention as set forth in this recent statement. rather the changes meant clarify how the committee anticipates policy evolving after the unemployment rate declined below 6.5%. let me explain the check outlook that underlies these actions. despite some softer recent data, the fluencies outlook towards continues progress toward our goal of maximum employment and inflation returning to 2%, remains broadly unchanged. unusually harsh weather in january and february, has made assessing the underlying strength of the economy especially challenging. broadly speaking, however, the spending and production data will somewhat weaker than we had expected in january on roughly

in line with our expectations as of december. the last time committee participants submitted economic projections. in contrast, market conditions have continued to improve. the unemployment rate at 6.7% is three tenth lower than the data available at the time of the december meeting. further, broader measures of unemployment such as the u6 measure, which includes marginally works and those working part time but preferring full time work, have fallen even more than they had lined unemployment rate over this period. labor force participation has picked up. while the committee continues to monitor developments in global financial markets caps late, financial conditions remain

broadly consent with the fluency objective. inflation has continued to run below the committee's two percent objective. given longer term inflation expectations appear to be well anchored and in light of the ongoing recovery in the united states and many economies around the world, the of a fluency continues to expect inflation to move gradually back. the committee is mindful inflation running consistently below its objective can pose risk to economic performance. the committee also recognizes, however, the policy actions tend to exert pressure on application

that -- inflation that have manifest over time. the affluency will continue to monitor data. this outlook is reflected in the individual economic projection submitted in conjunction with this meeting by the 16 affluency participants, four board members and 12 reserve bank presidents. as always, each participant's projections are conditioned on his or her own view of appropriate monetary policy. the central tendency of the unemployment rate projections has shifted down by a about two tenths sense december. now stands between 6.1 and

6.3 percent at the end of this year. the unemployment rate is projected to reach normal leonie level -- normal level by the end of 2016. the real gdp growth stands at 2.8 to 3 percent for 2014. it remains somewhat of above that of the estimate longer run normal growth through 2016. meanwhile, as i noted, affluency participants continue to see inflation moving only gradually back towards two percent over time as the economy expands. the central tendency of the inflation projections is 1.5 to 1.6% in 2014 rising to 1.7 to 2. 0% in 2016. let me now return towards a

decision to make another measured reduction in the pace of asset purchases. starting next month, we will be purchasing $55 billion of securities per month. down $10 billion per month from our current rate. even after today's action takes effect, we will continue to significantly expand our holdings of longer term security. we will also continue to roll over ensuring treasury securities and reinvest principle payments from the affluency holdings of agency debt and agency mortgage backed securities and agency mortgage backed securities. the sizeable and still increasing holdings will continue to put downward pressure on longer term interest rates. support mortgage markets and make financial conditions more accommodative helping support job creation and return of

inflation to the committee's objective. as before, if incoming information broadly supports the committee's expectation of ongoing improvement in labor market and inflation moving back over time, the committee will likely continue to reduce the pace of asset purchases in measured steps in future meetings. however purchases are not on a preset course and the committee's decisions that the pace of purchases remain contingent on outlook of jobs.

the new guys does not indicate any change in the policy intention of the fomc. instead reflect changes in the conditions we face. let me explain this more fully. in december 2012, the committee first stated its guidance in terms of economic thresholds. stipulating that the current low range for the federal funds rate target would be appropriate at least as long as the unemployment rate remains above 6.5%. inflation is projected to be no more than a half percentage point above our longer run goal and longer term inflation expectations remain anchored. sense that time, progress in the

labor market has been more rapid than we had anticipated. while inflation has been lower than the committee had expected. although the thresholds served well as a useful guide to policy over the past year, last december affluency judge appropriate to update that guidance. noting that the current target range will likely be maintained well past the teemment unemployment rate climbs below 6.5%. today, the committee is further revised its forward guidance to better reflect conditions as they now stand and are likely to evolve over coming quarters. the revised formulation starts with a general description of

the factors that drive affluency decision-making. then provides the affluency's current assessment of what those factors will likely imply for the future path of short term interest rates. in particular, the committee states that in determining how long to maintain the current zero to one quarter percent federal fund rate, it will assess progress towards its objectives of maximum employment and two percent inflation. in short, the larger the shortfall of employment or inflation from the respective objective set by the fomc and the longer any such shortfall is expected to persist, the longer the target federal funds rate is likely to remain in the present

zero to one quarter percent range. the affluency will base its ongoing settlement on a wide rake of information including measures of labor market conditions, indicators of inflation pressures and inflation expectations on readings on financial developments. as i've noted the assessment of those factors is consistent with the characterization provided in previous forward guidance. the committee continues to anticipate the conditions will likely warrant maintaining the current range to the federal funds rate for a considerable time after the acid purchase

program ends. the affluency also sum limited its guidance pertaining to the period after the asset program ends and the initial increase in the federal funds rate target has occurred. the statement continues to note that in deciding on the pace for removing accommodationings, the committee will take a balanced approach obtaining its objectives. the statement now adds the committee's current anticipation, even after employment and inflation are near mandate consistent levels, economic conditions may for some time, warrant keeping short term interest rates below levels the committee use as normal in the longer run. this guidance is consistent with the task for appropriate policy as reported in the participant's

projections. which showed the federal funds rate for most participants remaining well below longer run normal values at the end of 2016. although affluency participants provide a number of explanations for the federal funds rate, remaining below its longer run normal level, many cite the impacts of the financial crises and some note that the potential growth rate of the economy may be lower at least for a time. in summary, the committee's actions today reflected its assessment, the progress in the labor market is continuing but much remains to be done on both the jobs and inflation front. unemployment is still elevated. underemployment and long term unemployment remains significant

concerns and inflation is running significantly below the affluency's objective. these conditions warrant the continuation of highly accommodative policy reflected in today's policy statement. the federal reserve's interest rate guidance and its substantial still increasing holdings of longer term securities will ensure that monetary policy remains highly accommodative promoting the affluency objectives of maximum employment and price. thank you. i'll be glad to take your questions. >> madam chair. associated press. could you give us inside how the decision was made on dropping

6.5% numerical target in the forward guidance. was there any concern expressed that there's been criticism on forward guidance, that it's confusing markets not helping them in some ways. perhaps it would have been better to go to just a lower target, say 6%. could also address the concerns raised in the dissent that by dropping this, it lowers the commitment on fighting low inflation, thank you? >> thanks. as i mentioned in my statement, the reason the committee felt the time come to revise the forward guidance, the committee think it's been effective. i think it had a useful impact in helping markets understand

our expectations and shaping their own. it is becoming as the unemployment rate gets closer and closer to 6.5%, to breaching that threshold that seems like the one that is likely to be breached, the question is, markets want to know the public wants to understand beyond that threshold how will we decide what to do. so the purpose of this change is simply to provide more information than we have in the past even though it is qualitative information, we will be looking at as the unemployment rate declines below 6.5% in deciding how long to hold the federal funds rate. as i said, we've tried to give a general formulation of what we'll be looking at which is how far are we, how large are the

shortfalls in achieving our goals. how fast do we expect progress to be. that will be the main factors we'll be looking at. we initially started with unemployment rate as a threshold that i was easy enough for the committee to say, with unemployment rate above 6.5%, we know we're not close to full employment. not close to employment level consistent with our mandate. we wouldn't dream of raising the federal funds rate target. the committee has never felt that the unemployment rate is sufficient statistic for the labor market. i think if he to choose one indicator of the labor market, the unemployment rate is probably as good as one i could find. in assessing the real state of slack in the labor market and

ultimately inflationary pressures that could result from that, it's appropriate to look at many more things. that's why the committee now states we will look at a broad range of information. so the closer we get is we narrow in oncoming closer to the target we want to achieve. we will be carefully considering many indicators of how close are we to our targets. those are the main reasons. now, you asked as well about the dissent. he endorsed the new guidance about the likely path of the federal funds rate after we begin to finally raise it.

that indicates that it's unlikely to be back to normal levels for some time. he questions whether or not the reformulated forward guidance shows sufficient commitment of the committee to its 2% inflation objective. i would simply say on my own behalf and behalf of the committee, we are fully committed to the two percent inflation objective. we do not want to undershoot inflation for prolonged period of time. as i mentioned, monetary policy operates with lags. so the policies we have in place, we think will gradually move inflation back to two percent. if the committee had real concerns, then the inflation will remain consistently below two percent. i feel confident the committee will act to prevent that.

>> john, from the " wall street journal. there seems to be a slight upward drift in the expectations for rates going out to 2016. for instance a majority of officials see rates at one percent or higher. in the last forecast majority saw officials less than one percent. i wonder if you can explain why there's this small upward drift and expected rates among committee members? whether these projections are a good guide about the public about the path of rates going forward. how you reconcile this upward drift with the assurances that the committee makes in its statement that rate will stay below normal levels well into

the future? >> there's only very limited upward drift. the committee, i think the committee in assessing the economy, if you compare today's assessment with december's is virtually identical. almost nothing has changed. unemployment has come down. the labor market more broadly i think has improved a little more than we might have expected. that slightly more rapid improvement in the unemployment picture might explain, i can't speak for why write down what they do, a little bit of the upward shift in those dots. more generally, i think one

should not look to the dot plot as the primary way in which the committee wants to or is speaking about policy to the public at large. the affluency statement is the advice the committee as a policy making group uses to express its opinions. we have expressed a number of opinions about the likely path of rates. in particular the committee is endorsed to use it and it anticipate it is will be a considerable period after the asset purchase program ends before it will be appropriate to begin to raise rates. we will be looking at next fall. i think that's important guidance. looking further out, let's say if you look at toward the end of

2016, when most participants are projecting that the employment situation, the unemployment rate will be close to their notions of mandate consistent or a longer run normal level. what you see -- i think if you look this time, if you gaze at the picture from december or september which is the first year that we showed those slots through the end of 2016, is the massive points that are notably below practice the participants believe is the normal longer run level for nominal short term rates. the committee today for the first time endorsed that as a committee view. i think that's what we should be paying attention to. i would warn you that these dots

are going to move up and down over time, a little bit this way or that. the dots move a little bit in december relative to september. i really don't think it's appropriate to read very much into it. more generally, the end of 2016 is a long way out. monetary policy will be geared to evolving can bees -- conditions in the economy. as those views evolve, the committee views on policy will likely evolve with them. that's kind of uncertainty that the committee will want eliminate completely from its guidance. because we want the policy we put in place to be appropriate to the economic conditions that will prevail years down the road.

>> that one particular paragraph which says that the committee anticipates a lower than normal rate even once you return to the long run. i understand correctly. it means once you hit the longer run unemployment rate 5.4%, once you get two percent inflation rate, the mortgage should not then anticipate the longer run 4% fed funds rate. that would be question number one. question two, doesn't that suggest a shallower glide path once you take off. >> it does suggest shallower glide path. what the committee is expressing here, i would say is its forecast of what will be appropriate from years from now.

based on the understanding that we'll develop about what are the economic forces that has been driving economic activity. we've had a series of years now in which growth has proven disappointing. members of the committee have different views about why this is likely to be true that the funds rate, when the labor market is normalized and inflation is back to our objective, may be have slightly different views on exactly why it's likely to be the case that interest rates will be little lower than they were in the longer run. but for many it's a matter of head winds from the crises that have taken a very long time to dissipate and likely to continue being operative. some examples i would say is we

have households are under going balance sheet repair. there are under water mortgage holders, difficulties in gaining access to credit for example through home equity lines of credit. for some that makes it difficult to finance small businesses. mortgage credit is very difficult for those still to get without credit scores that improve somewhat over time. but it's not back to normal. for some fiscal policy is somewhat tighter than would be expected over the next several years. for some it's head winds from the global economy play a role as well. the general assessment is that

even after we've had an accommodative monetary policy for long enough to get the economy back on track in the sense of meeting our objectives, the stance of policy that will be appropriate through accomplish that won't be easier or involved somewhat lower than would be normal short term interest rates. eventually years later most people think they will go back up. as you said, that suggest the path will be gradual. i do want to emphasize this is a forecast. this is the committee's forecast based on its understanding of the economy at this time. as we watch the economy over the next several years that could evolve. >> hi washington post. you mentioned in your testimony on capitol hill that the fed was trying to assess the balance of

effects versus weakness in the economy as the reason for the slow down in growth in the first quarter. you guys mentioned specifically, does that mean that the fed analysis has come down or you still concerned there could be something else going on? you guys also lowered your forecast for gdp growth this year. >> certainly the analysis that we've done, we did spend a lot of time discussing how it's affected businesses and households in various parts of the country. certainly weather has played an important role in weakening economic activity. ....

around here a little bit, but if

we take december to march, committees views are largely unchanged. [captions copyright national cable satellite corp. 2014] [captioning performed by national captioning institute] >> hello. i am with the l.a. times. you have been on and you have served with the fed previously. i am wondering now in the past few weeks, as chairwoman, what has been different about being on the fed and your responsibility as chair? >> thanks. i am very lucky i have had a lot of fed experience to draw on. as i approach this role, because it is complicated and now in many ways, in terms of management and responsibility, to assure the federal reserve ofes progress on its schools

getting the economy back on on ournd making progress financial stability and regulation objectives. i feel the weight of responsibility keenly in the new role i have and i am very committed to making sure i've provide leadership necessary for the federal reserve system to move forward on these goals. in terms of the conduct of business, it is pretty much the same as usual. -- or havevisioning been so far any radical changes in how the federal reserve does its business. the includes operating fomc. >> robin harding from the financial times. given the new qualitative

guidance does not give any information about how you will trade off your unemployment and inflation objectives, how will the risk of higher inflation versus faster progress of unemployment as we get closer to unemployment? thank you. >> so far, we have not had the trade-off to make because inflation is running well below our objectives. remainseasure, there substantial slack in the labor market. aboutoffs and worrying doing more were less because we have conflicting objectives, this really has not been an in our discussions about how to conduct policy now. as we get closer to meeting our goals, it could become an element. we have given

guidance in this statement, and perhaps more guidance in our so-called consensus statement of longer run goals and monetary policy and strategies that would now reaffirm for three years in a row that the committee would take a balanced approach in situations where our objectives conflict and we are faced with between inflation and unemployment. when we first put our threshold into effect, we envisioned a possible situation where such a where we could arrive, might face a situation where unemployment was quite high, namely over 6.5%. and inflation might drift close to two. our threshold-based guidance gave more concrete indication we

would tolerate inflation running a little over two percent with unemployment sufficiently high before moving the federal funds rate off of zero. concretetent the guidance is useful, i do not believe it is a situation -- if i thought that was a situation we are likely to encounter in several years, we probably would have revived -- revise our forward guidance in a different way. as eliminating the language because it does not seem like a situation that is at all likely. i would point you to the final statement in this statement that the fomc does not see this guidance as indicating any change in our policy intentions. how we wouldde

make trade-offs between our inflation and employment objectives, if we were to face -- asituation area situation. first, you said something that happened by next fall, on a path until next fall, it was unclear if you are speaking -- >> i simply meant to say that if we continued to reduce the pace of our asset cases in the manner we have, in measured steps, the program would be winding down next fall. >> in this coming fall, not the fall of next year. >> this coming fall.

down the bondnd buying program, could you tell us how long of a gap we might expect before rate hikes again? -- begin? >> the language we use is considerable. this is the kind of turn that is hard to define. probably something around the order of around six months or that type of thing. it depends what the statement is saying, it depends what conditions there are. see where the labor market is and how close we are to our full employment goal. that will be a complicated assessment not just based on a single statistic, and how rapidly we are moving toward it,

really close and really fast? or are we getting closer but moving slowly? the statement and what it emphasizes, this is the thing language we used in december and january, we use the language, especially if inflation is running below two percent objective. principle tries to capture the notion. if we have a substantial shortfall in of inflation, if is persistently running below our two percent objective, narrow and -- that is very good reasons older for longer. >> the committee passes vice-chairman said recently if the economy decided it was not growing at all, those would be the kind of changes in the outlook that would warrant changing tapering. is that an accurate description

of what you mean? anything between zero and five? secondly, there is a lot of research showing short unemployment seems to be responsible for the level of inflation. is that the fed posses you at this point? >> the numbers you cited would be extremes. i would not go to such extremes. way i would put it is this. the first is we need to assess the labor market continues to be on demand and we seem reasonably that wille outlook

not get us back. second of all, we need to see coming back to the inflation again, inflation is low. we believe the evidence is consistent with it is moving up over time. within a longer comfortable making the assessments. they no longer seem reasonable make thecing to extensions and asset purchases

to the current plan. five percent and one percent are extreme numbers. i want to feel confident making those two statements. with respect to the issue of short-term unemployment, is more relevant for inflation of the labor market. to adopt any notion that says the stock is an accurate read on how inflation is determined. this is something our committee will look at, especially as otheroyment goes down and labor market indicators simultaneously improve. we have looking at a broadly -- range of indicators. mentions where we

see slack in the economy. >> you have spoken in the past about margin last year how you supplement your view about the labor market. layoffs and things like that. involvedour dashboard in speaking in the past few which indicators, positive andata, negative indicators, thank you. >> i have spoken in the past

about indicators i would like to to thein addition unemployment rate. we will certainly look at border measures. my statement. five percent of the labor force working part-time on an involuntary basis, that is a high number relative to the measured unemployment rate. to my mind, it is a form of slack that adds to what we see in the normal unemployment rate and is unusually large. down and moving in the right direction and is moving even more than recently. i watched marginally detached

workers ms chair has been immensely high and can be very stubborn in bringing down. that is something i watched closely that remains exceptionally high. from somethingn like 45% high 30 posses it is in my dashboard labor force participation. suggests due to factors, labor force participation will be coming down and there has been a downward trend for a number of years. component inclical the fact labor force participation is depressed. economy against to strengthen the, we could see labor force participation latin out for a time as discouraged

workers start moving back into the labor market. that is something i am watching closely. there are different views on this within the committee. it is hard to know definitively what part of the labor force participation is structural versus cyclical. something to watch closely. i mentioned in the past, measures of labor market turnover. usually going directly into another job. i think in many ways as a sign of the economy. reduce willingness to quit their jobs. quit rates are now below normal prerecession levels but on the

other hand, they have come up over time and we have seen improvement. the job opening rate has also come up. the hires rate remains extremely depressed and i think that is a market.a weaker labor these measures do not retain the identical measure of improvement, if you ask about my -- word, the dial on virtually all of those things is moving in the direction of improvement. the final thing i mentioned is wages. verygrowth has been really low. there has been one isolated measure of wage growth that presents an uptick, but most increase are at very low levels. growth, andivity

two percent inflation, one would probably expect to see something between perhaps three percent and four percent wage inflation would be normal. it has been running at two percent. not only is it depressed, signaling weakness in the labor market, it is certainly not flashing an increase which might signal tightening or meaningful on inflation, at least over time. i would say we are not seeing that. >> light angers from cvs. for tens of millions of americans, the recovery is a long time covering. thoughts on why the recovery is so slow and why the economy is not creating more.

>> the short answer is we have lived through a devastating financial crisis that has taken an exceptional toll on the economy in many different ways, from housing to leaving a huge number of homeowners with living in homes with mortgages that are underwater. it has had a highly negative affect on their credit ratings and ability to access credit. it has left his mrs. with cautious attitudes that we see in business investment spending which is very strange. we have had weakness in the global economy and a very tight fiscal policy at home after stimulus at the onset of the recession, we have had a good deal of fiscal consolidation in

the united states. at a time when fiscal policy of normally, in the past, would have been surfing to create jobs, fiscal policy from that standpoint has served as a headwind for the country, and especially at the federal level but also state and local levels as well. we have had a disappointing recovery and monetary policy is tried to do what we can to offset that. the linkages are not as strong or quick as we might ideally like them to be. >> thank you. i would like to take you back to last summer when there were hints by the fed that they were going to taper and long-term interest rates spiked.

what lessons, looking back at what lessons have you learned and are you confident you will not repeat those mistakes again? >> there are quite a number of things happening at that time. it is probably true monetary may have played a role touching off the market reaction but the market reaction was aacerbated by the fact we had very significant online to of trays and other leveraged that investors had taken, perhaps thinking the wasl volatility exceptionally low and perhaps lower than was safe for them to have assumed. ways, the fact the term

has come up in interest rate so it has had ah negative effect on the recovery which is evident in housing and the slowdown, perhaps it has diminished some financial instability risk that may have been associated with these traits and speculative activities unwinding during that is we will and we were trying but we will and will continue to try to communicate as clearly as we possibly can about how we will conduct monetary policy to bs steady and determined and transparent as we can to provide as much clarity as is reasonably certain given the economic developments in the

economy are themselves uncertain. as hard as we cannot to be a source of instability here. >> masher, abc news. drivers last spring and summer of home prices and home sales was that sense that interest rates were going up and were spiking. a year later, we're looking at a flat interest rate picture as far as homebuyers are concerned. is there any sense on your committee that staying on this level loses its punch the longer we remain here? if i am thinking about going out and building a home, why should i do that today as opposed to waiting a few more years and months before interest rates go up? >> the level of interest rates remains by historic levels. the level of household formation

is and has been very depressed for some time. a lot of kids were shacking up with their families. they would probably like to be places andnd wiring their own, and apartment order home. potentialemographic there for a new household that would generate either single or multifamily. the level of rates matters. the fact that there alone now is something that should serve as a backlus as people coming to the housing market. we have not yet seen the pickup uper interest rates went last summer, but i do expect housing activity to begin to expand more rapidly later on.

xdo not think it is only the dictation i have to live now, or things will be more expensive later, that spurs those decisions. >> hello. k davidson from politico. much has been made about the fact you and your predecessor agreed and shared many of the same policy views. can you tell us one way in which your chairmanship will be >>ferent and ben bernanke's? we are committed to the same set of goals. as i indicated, my goal, and i

will throw myself into this as wholeheartedly as i can, is to make as rapid progress as we possibly can in getting the recovery back on track in putting americans back to work and back in jobs. and moving up to levels of the committee's target of two percent. my predecessor was devoted to that also. strengthening the financial progress.a work in he made large inroads in strengthening the financial system. there is more work to be done. i have a long to do list. to seeigh priority further work done in addressing too big to fail. we have a to do list of things we want to accomplish and in

assessing threat to financial one ofty because neither us, no one wants to live through a financial crisis like the last one. we want to be extremely aware of emerging threats to the financial system. i have not answered your action by saying i will be different, but i think he had a good agenda and it is one i shared and it is to be vice watch chair and this agenda i continue to do. >> i wanted to talk about international developments and the crisis in ukraine. is the crisis a headwind for the u.s. economy and are there risks to the u.s. economy and the u.s. banking system directly and indirectly, and did the russians move $100 billion in u.s.

treasury securities and the last couple of weeks to avoid sanctions? those securities are held by the fed. thank you. >> let me start with the last piece of your question first. ,ovements in custodial accounts they are something i am not in a position to comment about. in terms of the situation in the ukraine and russia, it is something we are monitoring very close to. -- closely. andiscussed the linkages exposures of the u.s. banking system to the ukraine and russia are not large, that we are not , butmeaningful impacts now obviously there are geopolitical risks here that it is very important for us to be attentive

to and keep our eye on. we are not seeing a broader global financial repercussions. if this were to escalate, that would be something on our radar screen. we are not seen that now. >> you have spoken about how unemployment is more than just statistics to you. when you make that statement, who do you have in mind and what do you do to keep in touch with the human side, with the impact of the economic crisis and slow recovery we have had? >> i would the surprised if anyone in this someonesn't know

touched by unemployment and difficulties getting jobs and that is true of me and my family and friends as it probably is for many of you. ofpoke to a broad range business context and tried to stay in touch with what is happening to real people and the economy. we do a lot of work and development and have groups come and talk to us and explained to us how communities have been affected by the economic situation and the housing crisis. francisco, wesan had programs there and work closely in low income communities that have been very badly affected.

to study what kinds of tograms that can be affected try to understand what kinds of advice to those in the community developing lending field to help . i do try to listen to people who try to represent communities experiencing the worst of the crisis and stay in touch with it that way. against funding because we felt it is against american tradition to fund a

private army whose goal is to overthrow another government. we felt it is against american tradition to foster killing of civilians. we felt it is against american tradition to abandon the strength of our ideas and replace them only with the .trength of her arsenal a few weeks later, we are facing a country vote. -- contra vote. daniel ortega went to moscow. nationt happy about any turning to the soviets for economic help. that is not change the issue. contrasident calls the feeding -- freedom fighters. the vast majority are men who never believed in freedom. to give so-called humanitarian

army is ainhumane perversion of american morality. i have the report. example.ve you an four months pregnant, was killed at a state owned coffee farm i the contras. -- by the contras. a knife will and in her side. -- wound in her side. pregnant, was killed at a state owned coffee farm i , yes, but we must face this. there is violence on the left, oo., violence on the left and violence on the right must stop. the way to stop it is not by supporting a private renewal army who wants to overthrow the government of a country the size

of iowa, but by doing what america does best. negotiating a peaceful settlement. the way to stop this violence is .o support the amendment the blood of the innocent on our hands. let us not escalate the involvement of american troops in central america. vote against the michael amendment. >> find more highlights on her facebook page. america'seated by table companies 35 years ago and brought to you today as a public service. night, microsoft cofounder bill gates talks about poverty, global health issues, and the u.s. education system. andng a recent interview,

he said that in the next 20 there should be fewer than 10 countries and poverty. here is a little of what he said. you offer an incredibly bold prediction. you say that there will be almost no poor countries remaining by the year 2035. what do you mean by that? , is gdprimary measure per person. we do not have a substitute measure. banku take that, world codifies countries with over 1200 per person per year as moving up into a middle income bracket. 45 countries still are not low income category. by 2035, saying is

there should be less than half -- less than 10 and they will mostly be places like north korea, where you have a political system that creates or they are

we see what could be called 21st century revisionism. attempts to turn back the clock to draw new dividing lines on

our map, to monopolize markets, or simply rip up the international rule book and to use force to solve problems rather than the international mechanisms that we have spent decades to build. we have thought that such behavior had been confined to history. but it's back, and it's dangerous because it violates international norms of accepted behavior. it exports instability. it reuses the potential to cooperate and build trust, and ultimately it undermines our

security. not just nato's or ukraine's security, but also russia's. if the rules don't apply, if agreements are not honored, certainly russia also stands to suffer the consequences. russia was among those who committed in 1994 to respect ukraine's territorial integrity and sovereignty. russia pledged not to threaten or use force against ukraine. by turning its back on that agreement, russia has called

into question its credibility and reliability as an international actor. and its steps to annex crimea are a clear violation of the united nations charter. russia must honor its international commitments, cease all military activities against ukraine, and seek a peaceful political solution. including through direct dialogue with the government of ukraine, because on its current course, russia is choosing increased international isolation. there are no quick and easy ways to stand up to global bullies

because our democracies debate, deliberate, and consider the options before taking decisions. because we value transparency and seek legitimacy for our choices. and because we see force as the last, not the first, resort. the only way to address such challenges is for europe and north america to stand together. this is what we have done from the start of this crisis. nato's clear position has been to condemn russia's military actions in ukraine to stand firmly in support of the government in kiev and to make clear that president putin's decisions to escalate the

situation have consequences. as a first step, we have suspended joint planning for a maritime mission for the destruction of syria's chemical weapons. this would have been the first joint operation of the nato-russia council. we also decided that no staff level, civilian or military, meetings will take place with russia for now. and we have put the entire range of nato-russia corporation you should review. nato foreign ministers will take decisions when they meet in brussels early next month. at the same time, we have kept the door open for political dialogue in the nato russia council to give russia an opportunity to engage.

we have also taken measures to strengthen nato's readiness. they include more assets for our baltic air policing mission, surveillant nights over poland and romania and heightened awareness. allies have taken further steps to impose diplomatic and economic consequences. these are not our preferred choice. they are inevitable and appropriate consequences of russia's choices. no one wants to turn away from our cooperation with russia, but no one can ignore that russia has violated the very principles

upon which that cooperation is built. so business as usual is not an option. ladies and gentlemen, in times like this, when the security of the euro-atlantic area is challenged, the north atlantic alliance has not wavered, and it will not waver. for 65 years, we have been clear in our commitment to one another as at llies and the global security system to which nato is rooted. our transatlantic foundation is our strength, and it has given us the ability to consult,

cooperate, and cope with any crisis. this does not mean that nato is the only solution to every crisis in the euro-atlantic region, but i do believe it is part of every solution because the alliance provides three elements that are crucial for facing modern security challenges and that are vital for europe's and america's defense. these are political legitimacy, tried and tested structures, and military strength. now, first, political legitimacy. the combined and voluntary will

of 28 of the world's strongest sovereign democracies is an extremely powerful source of political legitimacy. something that unilateral action or coalitions of the willing simply cannot enjoy. this carries over into our missions and operations. it attracts partners whose political support and military contributions add to our broader international legitimacy. our mission in afghanistan is a clear example. it has included 50 countries. all 28 allies and 22 partner nations. that's one-fourth of all the world's countries.

the biggest and most effective coalition in recent history. a coalition that only nato could have gathered and commanded. and that leads me to my second point. nato provides tried and tested political and military structures. we have a unique permanent forum for political consultation where north americans and europeans meet every day to debate and decide how to ensure our collective security. just two weeks ago we met at poland's request to consult within the framework of the washington treaty. this allowed us to immediately address the security concerns of one of our members and to

reaffirm our solidarity. our political and military structures also provide us with a permanent crisis response system so we can react quickly and effectively to any concern with political measures, with military measures, or an appropriate mix of the two. we also have the permanent nato military command structure. so when we decide to take any military action, we have the right framework with the right skills and the right people already in place. we have headquarters that can be deployed quickly to command

operations and missions. we have reaction forces on standby. and we can bring the necessary military contributions together quickly from nato allies as well as from over 40 partner nations on five continents. time and again when an ally has felt its security under threat, we have come together and quickly provided the necessary support. after 9/11 when we deployed surveillance planes here to the united states, during the syria crisis when we deployed missile defense systems to turkey, and today when our surveillance aircraft are monitoring our borders in eastern europe.

now, imagine that nato did not exist. every time a crisis broke out, a political and military framework would have to be built from scratch. political consensus would have to be forged. partners found, military plans developed, and capabilities designed, delivered, and deploy. this would be costly. in terms of effectiveness, in terms of money, and in terms of time. indeed, once the necessary elements for a response were in place, it could be too late to stem the crisis. so, our standing structures save time. they save effort. and they save taxpayers' money.

they bring other advantages, too. they allow us to harmonize military requirements across the alliance. they support the equipping, training, and exercising of our troops. and they have helped us to build the most capable and connected military forces in history. and this is my third point. nato's unique military strength, it is a force multiplier. and it allows every ally, even its most powerful one, to pack a bigger punch. let me point out a few of the ways that american security has benefited from nato's collective strength. again, afghanistan is a good

example. in 2010, as american forces searched, european allies searched, and partners searched, too. over the past ten years, for every two u.s. soldiers who have served in afghanistan, one european soldier has always served with them. some 400,000 european soldiers have rotated through afghanistan to help make sure it would never again be a launching pad for international terrorism. in libya, three years ago, european allies, canada, and nato partners played a crucial role in enforcing an arms

embargo, maintaining a no-fly zone, and protecting the people from attacks by their own leader. today in kosovo, over 30 european and nato partner countries are keeping the peace. and off the coast of somalia, ships from four allied navies, spain, turkey, italy, and the netherlands, are sailing with u.s. ships. patrolling against pirates, and keeping vital sea lanes safe. european nations are helping to ease america's security burden in other ways, too. for example, the european union is running its own counterpiracy operation. and several european nations have stepped up to respond to the growing instability in

africa. in particular, in mali and central africa. so, nato makes a unique contribution to our security because only nato brings together the world's most capable democracies in a permanent integrated political and military structure. and only nato delivers the political legitimacy and military strength that no one nation or ad hoc coalition can deliver on its own. it comes down to a simple truth. shared security is better than solitary insecurity. and it's cheaper, too. it's why nato is a great

defender of america, a great deal for america. and it's why nato matters to america. that said, i am the first to stress that europe must do more. i take every opportunity to point out that there should be a fairer sharing of the costs and the responsibilities. both between north america and europe and within europe. and developments in ukraine are a stark reminder that security in europe cannot be taken for granted. and that neither europe nor

america can come up with the solution alone. that's why i will continue to remind european nations that they need to step up politically and millitarily to hold the line on defense cuts, to increase their defense spending, and to work together to fill key capability gaps, including missile defense, cyber defense, and joint intelligence surveillance and reconnaissance. later this year, in wales in the united kingdom, we will hold our next nato summit. we need to take tough positions in view of the long-term strategic impact of russia's

aggression on our own security. our commitment to the security of allies is unbreakable. we will bring our isef mission to a close and prepare our future partnership with afghanistan. we will ensure we have the right capabilities we need to address the modern threats we face, like cyber attacks and missile proliferation. and we will strengthen our partnerships with like-minded countries in our neighborhood and around the world. our wales summit will move us along a path we have paved together to ensure our alliance is even better suited to meet the collective security requirements of every allied

nation. including your own. and fit to face any challenge the future may hold. ladies and gentlemen, as recent events have shown, we continue to face critical security challenges, and new challenges are emerging all the time. an environment where countries decide they can redraw the geopolitical map, use the cyber domain to cause harm, or attack innocent people because of political and ideological disagreement. we must stand united in the face of all those challenges which make our world more dangerous and unpredictable. our common history shows us the

way. in june, we will commemorate the 17th anniversary of the d day landings. i remember my own visit to normandy together with my family. seeing the beaches, where so many allied troops, european and american, gave their lives for freedom. walking past the rows of whitehead stones that mark those soldiers' graves. those brave soldiers who stormed the normandy beaches knew then what we must not forget now, that sharing security today means preserving freedom, democracy, and prosperity for tomorrow. that's the spirit in which nato

was founded. and that's why nato matters for the united states and for all the allies today and in decades to come. thank you. [ applause ] okay, are the mics working? sorry about the technical interruption. secretary-general, thank you so

much for those very spirited and important remarks. it's very much, as we open up to the audience, a spirit of anniversary. as you were speaking about d day, it wasn't just the normandy beach landings, it was also the russians be part of that alliance on the eastern front. and it's also all of the anniversaries of the siege of stalingrad and other issues. our world war ii history was a time that we shared. unfortunately, it's also about the 160th anniversary of another series of crisis in the crimea. i started to remember that the crimean war actually broke out around 1854, so again, 160 years ago. that was also over a miscalculation, misunderstanding about russia's interest then and what was the ottoman empire and the role of slavs and the orthodox christians that end up with another series of events that's led to not just

recriminations, but unfortunately military action on and around that same peninsula with lots of strange people on different sides. the balaclava, which we've seen in crimea on those various outposts. so as mr. putin reminded in his speech the other day, history, depending on where you want to pick it up, is never very far away. but today you've also said some very important things about the future, as well as about the present. i think there's going to be a lot of questions about the things that you've said. we have many members of the diplomatic corps in washington, d.c. the think tanks, which we are very glad to see. students from other universities close by. many other academic analysts and members of the press corps. so i'd like to hold it open now to the floor. i'll try to take, if it's okay with you, a couple of questions at a time. we've got exactly half an hour. so again, if people could keep those short and we'll start with

this gentleman here at the front, if you could wait until a microphone comes to you. please identify yourself and then the lady behind you. >> i'm michael gordon, "new york times." sir, the united states has sent a dozen f-16s and several hundred service personnel to poland as a reassurance mission. but if nato is trying to send a message of resolve, shouldn't the reassurance mission be a nato-led effort involving multiple countries on land, sea, and air, in poland, the baltic states and the black sea. and also, ukraine has been seeking support for its military. shouldn't nato consider providing intelligence support, logistical support, and advisers to help strengthen the ukrainian military and deter possible russian militaryvention. this is the greatest crisis since the cold wars and something more required than suspending a joint maritime operation and stopping staff level meetings. >> thanks.

if the microphone could go to the lady just behind you with the glasses. >> thank you. laura jakes with associated press. this is a good segue from michael's question. you mentioned ongoing nato missions in kosovo off the somali coast and of course in afghanistan. as nato now focuses on european security as a result rf russof s aggressions, how will that affect strategy in other missions, particularly afghanistan? thank you. >> thank you. secretary-general? >> to start with the latter, we have the capacity -- does it work? yeah, now it works. we have the capacity to deal with several missions and operations at one at the same time. and i don't think events will not have any impact on our

engagement in afghanistan. we follow the plans as already outlined, which means completion of the isef combat operation by the end of this year, and provided we get a signature on the security agreements, deployment of a nato led training mission from the first of january 2015, and there will be no change in those plans. on nato engagement in the crisis, yes, if we take the baltic air policing, the united states took a quick step to augment their contribution to a baltic air collision, which is highly appreciated. the good news is that this

initiative will now be followed by other nato allies. a couple of days ago, the uk announced that they will contribute to augmenting or enhancing air policing over the baltic states and other announcements will follow, so you're right, it should be and it is and it will be a nato mission. the same goes for the deployment of awax planes over romania and poland. these are part of a nato operation. but having said that, it's normal practice that individual allies can take immediate steps and then it's followed by a more

broad nato mission. and i envisage further steps to reassure allies to strengthen deterrents and a collective defense in light of what we have seen. and then on ukraine, which is the second part of your question. we have intensive meetings in the ukraine commission. i have met the ukrainian prime minister. the ukrainian foreign minister. they have forwarded a number of requests. we are now looking into those requests, and i would expect foreign ministers to take decisions on enhanced partnerships, increased assistance to ukraine when foreign ministers meet on the

first and second of april. i agree that we should step up our assistance to ukraine and i'm sure it will happen. >> thanks. i'm trying to collect questions. i see hands coming up. the gentleman here at the aisle. if people keep their hands up, i'm trying to keep track, please. thank you. >> you have explained very effectively the logic of suspending cooperation under the nato-russia council. how would you respond to two counterarguments to that? the first being that that cooperation is as much a nato interest as it is a russian interest. and the second, perhaps more important counterargument, that perhaps it is precisely a moment of conflict and disagreement