outlook. and janet yellen will be taking to the mike 30 minutes from now. here with me, charlie gasparino. matt mccall. and nicole petallides at the stock exchange. james at the cme. >> the fed continues to taper, the fed could new to taper cut in the bond purchases by $10 billion per month as expected. statement on was identical to the last one in april. information received since the open market committee met in april indicates growth and economic activity has rebounded in recent months. indicators show further improvement, unemployment rate remains elevated. household spending writing moderately and business fixed investment resumed its advance while the recovery in the housing sector remains slow. restraining economic growth

while the extent is diminishing, inflation has been running below the longer run objective but longer-term inflation excitations have remained stable. going to skip redundant language. the quantities of bond purchases will be cut from $45 billion per month to $45 billion per month. skipping over redundant language from the previous statement, the fed reminds investors asset purchasers are not on a preset course. the fed continues to hold the federal fund rate at zero to a quarter percent. and the fed says finally the committee currently anticipates even after employment and inflation are near mandate consistent levels, economic conditions may warrant keeping the target federal fund rate below levels the committee views as normal in the longer run. language are. from the latest statement.

this was a unanimous decision 10-0 including several new members of the fed. for the economic outlook the fed has downgraded the outlook for gdp. no surprise given the terrible first quarter because of all of the bad weather now sees the gdp growing at 2.2%, had seen it growing closer to 3%. still about 3% growth going forward. it has cut its expectation for the unemployment rate to about 6.1% from 6.2, and see that getting down to about 5.6% in 2015 closer to the level of full employment. the inflation numbers have been about theip=ñ same, it expects % inflation for 2014, 1.842015 on average and 1.8 going forward in 2016. for the outlook for when it may

raise the federal fund rate, we have the blue dot our investors are watching and the survey of fed numbers on the appropriate timing of monetary policies. one fed number sees rates going up in 2015. 3c rates going up in 2016. not much of a change from the march projection be it as for target federal funds rate, the numbers a little more hawkish. short-term fed fund rate little over 1% in 2015, getting up to two and .5% in 2016. back to you. melissa: i want to bring in more of the panel. that may start with you, what sticks out to you?

>> whether the economy is 2.2, 2.5, 2.0, i don't think it matters. that is what fisher has been counting on. the general outlook is they will keep printing money or lower rates until everybody has a job. you need an employer. melissa: you heard me say james before, give me your reaction. >> the market was trending lower into the announcement. initial print was lower, the market has not come back and taken out the day's high. we are trading higher on volume here. we can move more than 17 handles by friday which means s&p could be on the all-time highs by friday if we see a continuation higher here. >> number one, the fed is receiving importance for you as an investor. this is redundancy, redundancy, redundancy.

tapering, keeping interest rates low. it remains at zero, that is for the market. the fed has been ineffectual spurring the economy the way it should be at pretty clear base n the economic forecast they don't push the number of strings. melissa: the number is down now. >> this move is not that bad, big moves to the upside, downside for the first 20 minutes we will be up and down. nothing came out of this, they are pretty bullish on everything. melissa: nicole petallides, what are they saying on the floor? >> we jumped about 30 points or so from negative territory into positive territory. now back where we started basically. the concern overall, gdp growth

has been lackluster, the unemployment rate remains elevated, but the big picture it seems they will stay on course at least for the moment. >> we know one other thing, the fed is ineffectual. i don't think they can print any more money and prove this economy. they are pushing on strength. melissa: the negative pride in the first quarter, 2.2 still seems optimistic on the year. >> there is a little bit more money in the system. >> doesn't that scare you? >> it is now five years from the crisis and still doing a policy.

>> my attorney policy is not working the way it should. absent of robust policy, i don't think we're going to get 50% growth. >> you are at levels you can only do so much until it is out there. people are not in the market, the volatility is low, what will get people to invest again? melissa: is that what you are seeing out there? >> s&p futures went from positive to negative, back to positive. we have to be careful until he gets to the press conference. melissa: you are there all the time, lis are you surprised by e way nothing seemed to change? >> the only change is the capital spending has turned back up, that is a big thing

everybody looks for. we did not see it earlier, now the fed says we are starting to see that, that is critical to the forecast. does anybody have a quote on the 10-year yield please? >> i do. what is interesting is the disconnect, melissa. how we have seen the market hovering around record highs. and yet unemployment, still the economy does not feel that it has really improved. there really is a disconnect between wall street and main street. >> what you need his policies geared toward growth. monetary policies and working anymore. now maybe look at why are people not hiring in the united states. is it because we tax worldwide

income along with only five other companies? >> you should look at this two ways. as an investor with means for your job. as an investor it is good for the market. i don't think they will raise rates be had the market should keep going up. modest growth, low interest rates, you by an index, that is generally the role. it is not working. melissa: we have to squeeze in a break. a rough road could be ahead thinks the fed policy, what are the dangers ahead? their answers will surprise you. and janet yellen speaking very shortly. we will have the news conference live as it happens. more money coming up in a

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melissa: the fed announcing the next steps but could the policies be backfiring?

consumers getting hit with food prices at all-time highs. mortgage rates climbing higher. joining me now, steve moore. a fox news contributor. and we have wayne angell. charlie gasparino and james friedman are back with us. thanks to all of you for joining us. we are looking at what are the trouble signs ahead on the horizon? looking at food prices soaring, ground beef 16%, steak 11%, fish is higher, chicken is higher. people are getting hit at the store with food prices going higher. what is your warning sign on the horizon? >> generally you have built commodity inflation. the one thing is some of this stuff is supply oriented. i don't know if in fact stakes are costing more. melissa: it is because of the problems.

another inflation coming to consumers and the fed has no ammo. because it has been a disaster. >> i think the fed has no ammo on the economy anymore. melissa: what do you think? >> i think the fed has plenty of power to do what needs to be done if they can just get their head around the problem, and the problem is the fed was way too easy in the greenspan years and we had asset problem and that came crashing down and then people decided we haven't regulated the market enough so we moved to an overregulation of the market and so consequently lending does not increase the banks and the fed ends up with all these excess reserves. melissa:'s excess reserves is a sign on the horizon. what is your trouble on the horizon?

>> they keep on saying the monetary policy is not working. when has it ever work? the fed does not increase growth. >> my only point was when it is the only game in town, he have to valuate it. >> i think if you want to make americans really angry, tell them inflation is only 1% or 2%. they do go to the grocery store, they go to the gas pump and cities prices rising faster. americans are worried about higher prices. i think this is bullish for the market. >> i'm a child of the 70s, i worry about stagflation. it is kind of bad every quarter. you have that plus steadily bad inflation, what is janet yellen going to do eight months him now?

melissa: james friedman, what is your sign of trouble? >> looking down the road, this will be hard to retreat from the huge balance sheet as the rates are rising. melissa: that was supposed to be your breaking news. charlie does have breaking news he is reporting right now. >> i don't know this is trouble on the horizon. goldman sachs abysmal on whether to cut the fourth. you have a debate lead on whether the trading environment because the market is so screwy will ever get better. they are reluctant to make the cuts. based on how much money they're making in trading, they should cut significantly. 10% cut in the trading staff but what they are praying for is some sort of normal trading when something normal occurs in this market in terms of interest rates as that is where we are right now. as to whether to cut.

melissa: janet yellen said to hold a conference minutes from now we had what they down on the tough questions that lie ahead for her. what would you ask her? you have been great on twitter, tell me what your question is. can you ever have too much fed money?

♪ melissa: janet yellen said to speak in a few short minutes. we're looking for more details on the taper timeline as the economic outlook. if you had a chance, what would you ask janet yellen? back with me now, matt welch, let's start with you.

>> has ever been a time in making history with extended low or zero that didn't create damaging asset bubbles somewhere? >> i would ask her why she is acting like a politician. seriously, when she gives speeches now she gives i feel your pain calling out people in the audience. it is scary. you want somebody watching the prices and reacting to that, we don't need another politician in washington. >> i asked her how much did the fed contribute. if you look essentially at what happens right after the financial crisis, very convoluted fiscal policy. barack obama threatening higher taxes and doing s some stupid stainless package that he admits didn't work but the fed save us from depression. >> i would ask madame chairwoman is 2.2% real economic growth, is

that the new normal and how'd we get back the 4% growth we haven't seen her so long in this country, what do we do to get middle income families incomes rising? melissa: wayne angell. >> we got to stop this over regulatory harassment of businesses and enable businesses to make loans. when businesses make loans commercial bank lending will use up these excess reserves. until they get out of this, we are in a mess. melissa: she might say i did not hear a question in there. >> my question is when are you going to recognize a need to go straight, neutral level in regard to commercial bank lending. >> why don't you want to get rid of dodd-frank. melissa: the "wall street journal" raise a great question

on the cover talking about this idea are we in trouble down the road, we have all of this food policy. people have gone back to work have gone to really low-paying part-time jobs and yet we still have the rate of inflation, if it comes, what do we do at this point. what do you think for this one? >> we have had loose monetary policy for seven years. not to continue his argument with charlie, but this is no recovery. >> steve, we have a passive financial crisis. we are not in a depression. melissa: steve friedman, go ahead. >> she thinks her job is to get the unemployment rate as low as it could possibly go, and she doesn't -- >> that is part of her job, you know that, right?

>> i don't know if she has given up, if she is just decided it is all up to me, but it is beyond her power. the on her power to force people to make business investments and hiring decisions. they need a reason. melissa: when you say you're worried about inflation, you get laughed at. so we created an environment to see it spark and run away or is that an unrealistic fear? >> we are not creating an inflation right now, but we keep messing around like this and the danger rises. melissa: real quick. >> it is a risk. if they don't extricate themselves from this huge balance sheet. >> if we do have some sort of stagflation or a price shock. the fed will raise rates when the economy is growing 1%? >> they have to digest the pig at some point.

melissa: thanks, that is terrific. we are minutes away, the fed chair meets the press right after this. don't go anywhere, more "money" coming up. [ male announcer ] it's one of the most amazing things we build and it doesn't even fly. we build it in classrooms and exhibit halls, mentoring tomorrow's innovators. we build it raising roofs, preserving habitats and serving america's veterans. every day, thousands of boeing volunteers help make their communities the best they can be. building something better for all of us. ♪ if ...hey breathing's hard... know the feeling? copd includes emphysema and chronic bronchitis. spiriva is a once-daily inhaled copd maintenance treatment that helps open my obstructed airways for a full 24 hours.

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seconds from janet yellen's news conference. we will look at how the markets are doing, right back where we were before this started. tres knippa, what is happening at the cme and what you're listening for in theion and answer period? >> we will listen for something that is not going to happen, some sort of admission that janet yellen see that inflation could be a problem. i wonder why don't retired people, mom and dad, why are retired people absolutely not furrowing the television over

the balcony of their condominium when janet yellen comes on and says listen, i am not going to give you anymore returns because you are on fixed incomes will keep interest rates artificially low so you won't get a return on your savings and continue to tell you there's no inflation bleach in what alternate universe, even one of the panelists in your previous section was talking about no inflation, health care costs going up, food prices going up, rand going up on houses, things like that and yet we are told there is no inflation. the retired people of the united states should be throwing a fit apart from the fact that janet yellen looks like a sweet little old grandmother. we will leave that part aside. melissa: what you listening for? nicole: prior to the announcement to the downside we went up, we went down, we had some volatility, interested to see when she says about the labor market and housing, the housing recovery remains slow. janet yellen stays on track, or

the markets will remain on track as well. if there's anything jarring to these markets. dierdre: go ahead. >> even if we don't get a big inflation, that doesn't mean there has been no cost. this is a huge reallocation of wealth. old folks living on fixed income at wealth transferred from them to people going out into more risky assets so it is a huge distortion in the economy. the interest rate is the most important price in world. when you distort it you create winners and losers even if we don't get the big inflation. melissa: janet yellen is taking the mic. let's listen in. >> the federal open market committee concluded its june meeting earlier today. as was indicated in our policy statement the committee decided to make another modest reduction in the pace of its purchase of

longer-term securities. the committee maintained its forward guidance regarding the federal funds rate target and reaffirmed its view that highly accommodative stance of monetary policy remains appropriate, today's policy actions reflect the committee's assessment that the economy is continuing to make progress toward our objective is of maximum employment and price stability. in the labour market conditions have improved further. the unemployment rate at 6.3% is 0.4 lower than at the time of our march meeting and a broader measure which includes marginally attached workers and those working part-time but prefer full-time work has fallen by a similar amount. even given these declines, unemployment remains elevated

and border assessment of indicators suggests underutilization in the labor market remains a significant. real gdp declined in the first quarter, this decline appears to have resulted mainly from transitory factors. private domestic final demand that is spending by domestic household and businesses continues to expand in the first quarter and limited set of indicators of spending and production in the second quarter has picked up. the committee thus believes economic activity is rebounding in the current quarter and will continue to expand at a moderate pace thereafter. overall the committee continues to see sufficient underlying strength in the economy to support ongoing improvement in the labour market. inflation is continuing to run below the committee's 2%

objective and the committee remains mindful that inflation running persistently below its objective could pose risks to economic performance. longer-term inflation expectations appear to be well anchored as part of the ongoing recovery in the united states and many economies around the world the committee continues to expect inflation to move gradually back toward its objective. the committee will continue to assess incoming data carefully to ensure policy is consistent with attaining fomc's longer run objectives of maximum employment and inflation of 2%. this outlook is reflected in the individual economic projections submitted in conjunction with this meeting by the fomc participants. as always each participant's projections are conditioned on his or her own views of

appropriate monetary policy. the central tendency of the unemployment rate projections is slightly lower than in the march projections and now stands at 60 to 6.1% of this year. for mayor participants generally see the unemployment rate declining to its long run normal level by the end of 2016. the central tendency for gdp growth is 2.1 to 2.3% for 2014. down notably from the march projections. largely because of the unexpected contraction in the first quarter. over the next two years the projections for real gdp growth remain somewhat above the estimates of longer run normal growth.

fomc participants continue to see inflation moving gradually back toward 2% over time as the economy expands. the central tendency of the inflation projections is 1.5 to 1.7% in 2014 rising to 1.6 to 2% in 2016. as i noted at the outset the committee decided today to make another major reduction in the pace of asset purchases. starting next month, we will be purchasing $35 billion of securities per month, down $10 billion per month from our current rate. after today's action takes effect we will continue to expand our holdings of longer-term securities and we will also continue to roll over maturing treasury securities and reinvest principal payments from the fomc's holdings of agency

debt and agency mortgage-backed securities and agency mortgage-backed securities. the sizable and still increasing holdings will continue to put downward pressure on longer-term interest rates, support mortgage markets and financial conditions more accommodative helping to support job creation and a return of inflation to the committee's objective. today's announced reduction in the pace of asset purchases reflects the committee's expectation that progress toward its economic objectives will continue. if incoming information broadly supports the committee's expectation of ongoing improvement in labor markets and inflation moving back over time towards a longer run objectives the committee will likely continue to reduce the pace of asset purchases in measured steps in future meetings.

however, as i have emphasized before, purchases are not on a preset course and the committee's decisions about the pace of purchases remain contingent on its outlook for jobs and inflation as well as its assessment of the likely efficacy and cost of such purchases. let me turn to the framework we will be applying as we consider interest-rate policy. in the determining how long to maintain the current zero-1% target range for the current federal funds rate the committee will assess progress both realized and expected ford its objectives of maximum employment and to present inflation. this brought assessment will not hinge on any one or two indicators but will take into account a wide range of information including measures of labor market conditions, indicators of inflation

pressures and inflation expectations and readings on financial developments. based on its current assessment of these factors, the committee anticipates that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends especially if projected inflation continues to run below the committee's 2% longer run goal and longer-term inflation, longer-term inflation expectations remain well anchored. once we begin to remove policy accommodation is the committee's current assessment that even after employment anti-inflation on mandates consistent levels economic conditions may for some time warrant keeping the target federal funds rate a low level of the committee's use as normal in the longer run.

this guidance is consistent with the paths for appropriate policy as reported in the participant's projections which show the federal funds rate for most participants remaining well below longer run normal values at the end of 2016. fomc participants provide a number of explanations for the federal funds rate target remaining below its longer run normal level, many cite the residual effects of the financial crisis. these include restrained household spending, reduced credit availability and diminished expectations for future growth and output and income is consistent with the view that the potential growth rate of the economy may be lower for some time. let me reiterate that the committee's expectation for the paths of the central federal funds rate target is contingent

on the economic outlook. if the economy proves to be stronger than anticipated by the committee, resulting in a more rapid convergence of employment and inflation to the fomc subjective -- objectives, increases in the federal funds rate target are likely to occur sooner and to be more rapid than currently envisaged. conversely if economic performance disappoints, resulting in larger and more persistent deviations from the committee's objectives, increases in the federal funds rate target are likely to take place later and to be more gradual. before taking your questions of life to provide an update on the committee's ongoing discussions on the mechanics of normalizing the stands and conduct of monetary policy. to be clear, these discussions are in no way intended to signal

imminent change in the stance of monetary policy. represent prudent planning on the part of the committee and reflect the committee's intention to communicate plans to the public well before the first step in normalizing policy become appropriate. the committee is confident that it has the tools it needs to raise short-term interest rates when it becomes appropriate to do so and to control the level of short-term interest rates thereafter. even though the federal reserve will continue to have a large balance sheet for some time the committee's recent discussions have centered on the appropriate mix of tools to employ during the normalization process and the associated implications for the degree of control over short-term interest rates, functioning of the federal funds market and the extent to which

the federal reserve transacts with financial institutions outside the banking sector. the committee is constructively working through the mini e issues related to normalization and will continue its discussions in upcoming meetings with the expectation of providing additional details later this year. thank you, i will be happy to take your questions. >> there is every reason to expect fact the pc inflation rate followed by the fed looks likely to exceed your 2016 consensus forecast next week. does this suggest the federal reserve is behind the curve on inflation? and what tolerance is there for higher inflation at the federal reserve and if it is above the

2% target, how is that blowing through a target the same way you blew through the 6.5% unemployment target in the day becomes soft targets? thanks. >> thanks for the question. i think recent readings, the cpi index have been on the high side but i think the data we're seeing is noisy. it is important to remember broadly speaking, it is evolving in line with committees expectations. the committee as expected a gradual return in inflation for its 2% objective and i think the recent evidence we have seen abstracting from the noise suggests we are moving back

gradually over time to our 2% objective and i see things roughly in line with where we expected inflation to be. if you look at the projections that were submitted this time you receive very little change in inflation projections of the committee. >> what about the tolerance of hierarchy? >> the committee has emphasized we had a 2% objective for as a longer-term matter for pc e inflation and we would not willingly see a prolonged period in which inflation persistently runs low were objective or above our objective and that remains true. says that hasn't changed at all in terms of the committee's tolerance for permanent

deviations from the objectives and you see the data coming in extracting from the noise in line with we expected and continue to see a gradual pickup over the next several years toward our 2% objective. >> robyn harding from the financial times. can you comment a little more on the decline and a long run interest rate protection. is that more to do with temporary head winds from the recovery or something more permanent about the economy and if that is a has declined to 3.75%, do you think there is potential for this rate to go lower yet? >> you do see a very slight decline this time with longer-term, and longer-term interest-rate projections. i would caution you we had

turnover in the committee for new participants, and departed and that can create changes in the projections, small changes that are difficult to interpret but it is fair to say there has been a slight decline and the most likely reason for that is there has been some slight decline as i mentioned in my opening statement of projections pertaining to longer term growth and typically estimates of the longer run normal federal funds rate, short-term interest rates moved in line with projections. >> the washington post. my question on the flip side is

about your outlook for unemployment. your predecessor has said that the fed has been too pessimistic about the level of the unemployment rate and today you guys lower your outlook again. can you tell me a little more about how you see the unemployment rate devolving to me your forecast, why you believe the rate of decline will start to level off and what an unexpected drop might mean for the first rate hike. >> it is true that unemployment has declined more than the committee expected and you do see a small downward revision in the committee's projections, at least the central tendency for the unemployment rate. first of all, the labor market has continued to broadly improved. we have seen continued job growth at a pace that is

certainly sufficient, diminishing labour markets overtime. over the last three months for example, employment, payroll employment has been rising around to 30,000 jobs per month and we're running close to 200,000 over the last year so is in no way surprising to see a decline in the unemployment rate. that said, many of my colleagues and i would see a portion of the decline in the unemployment rate as perhaps not representing diminution of slack in the labour market. we have seen labor force participation rate decline and while i think most of us would agree that there has been and will continue to be decline in the labor force participation rate for demographic reasons, i think a portion of the decline

we have seen in the unemployment rate probably reflects a kind of shadow unemployment where discouragement, cyclical part of more labor force participation. if that is correct, we may see as the economy picks up steam and we see further recovery in the labour market let's call them discouraged workers, will return either to unemployment or to employment and as labor force participation begins to stabilize the unemployment rate will come down less quickly and i think for a number of people, that is a component of the forecast. you asked about implications for the paths of policy and i say the guidance we have given, our

forward guidance, the timing of liftoff, actual progress we see and the progress we expect to see going forward in terms of achieving both of our goals. and 2% inflation objective. so we are not going to look at any single indicator like the unemployment rate to assess how we are doing meeting our employment bowl. we will look at a broad range of indicators. that said as i try to emphasize in the opening statement there is uncertainty about monetary policy, the appropriate path of policy, the timing and pace of interest rate increases, will respond to unfolding economic developments. if those were to prove faster than the committee expects it would be logical to expect a

more rapid increase in the fed funds rate, the opposite holds true and if we don't see the improvement projected in baseline outlook, the opposite would be true and the pace of the timing in case of interest-rate increases would be later and more gradual. >> the wall street journal. some fed officials and market commentators have noted market conditions recently have looked oil little bit like they did last spring before a period of turbulence, volatility is very low and stock and bond markets, risk premiums are very low and in particular, market expectations for interest rates, short-term interest rates look below the fed's own projections.

and what is your read on market activities and are you concerned about complacency and markets, what is your view on market expectations with the rate hike that the fed laid out. and where the fed is on that. >> i start by saying volatility, both actual and expected in markets at low levels, the fomc, no target for what the level of volatility should be. and levels of volatility, may induce risktaking behavior that for example in tales excessive

buildup in leverage or maturity extensions, things that can pose risks to financial stability later ron that is a concern to me and to the committee. the number of reasons that have been cited for what is going on in the marketplace, and i don't know if overconfidence or complacency, i would say it is important as i emphasized on my opening statement for market participants to recognize, there is uncertainty about what the path of interest rates, short-term rates will be and that is necessary that uncertainty that the path of the economy will be, i want to emphasize as i have the fomc will adjust policy to what it actually sees unfolding in the

economy over time and necessarily gives rise to a certain revel of uncertainty about what the path of rates will be and it is important for market participants to factor that into their decisionmaking. you asked about -- our forecasts, projections for the fed funds rate. you do see a range of disagreement among participants there. by the time you get to 2016 there is a considerable range of opinion and i think in part that reflects the uncertainties that i am talking about, participants do see different pieces of recovery, different trajectories for inflation. and it is appropriate for them to adjust their thinking about -- about what policy should be for their own view of how the

economy will evolve over time. around each of those, i think every participant who is filling out that questionnaire has considerable band of uncertainty around their own individual forecasts. >> new york times. you have spoken about the sense that the recession has done permanent damage to the economic output and reduce gradually over time your forecast of long-term growth. i am curious to know to what extent you think stronger monetary and/or fiscal policy could reverse those trends. of this duck with slower growth? is there something you can do about it? if so what? if not, why? >> i think part of the reason we are seeing slower growth and potential output may reflect the fact that capital investment has

been very weak during the downturn, and the long recovery we are experiencing so diminished contribution from capital formation to growth does make a negative contribution to growth and as the economy picks up i certainly would hope to see that contribution restored. on course, we have had o

unemployment and the network can contact then they have that are helpful in gaining employment can begin to erode over time. we could see what is known as individuals, because they haven't had jobs for a long time, find themselves permanently outside the labour force. my hope and expectation is as the economy recovers we could see some repair of that, many of those individuals who are long-term unemployed or those who are now counted as out of the labour force would take jobs if the economy is stronger and would be drawn back in again but it is conceivable that there is some permanent damage there too to them to their own well-being, their family's well-being and the economy's potential. >> thank you, madam chair. i believe you mentioned in your

opening remarks tighter credit. i am wondering what you think of the possibility that the federal reserve itself with regulations that it has to impose under dodd-frank is partially responsible for that and second the current trend toward litigation. i recently read something where the largest banks in the u.s. paid $51 billion in fines so far and obviously the number is rising, why would anyone loan to a near prime borrower and if you look at federal reserve bank of new york research, here we are five years into the expansion that people below 700 are having a worse credit experiences so it probably isn't because unemployment is declining but banks simply don't want to take the risk. as the nation's top bank regulator what can you do to fix

that? >> i first would start by saying i think it is essential in the aftermath of this crisis, and strengthen financial with elation. the financial system is more robust and reduce systemic risk. we can see what the costs of the financial crisis were and i don't think any of us should want to see that repeated sell i think the regulations we put in place, most of which follow from dodd-frank, are highly appropriate to create a more robust financial system, will be a safer and sounder one for the economy going forward. and we are making progress on doing that. putting regulations into place we have tried to to face the man in a way that gives long enough

lead times to make sure that in strengthening the financial system we don't produce a credit crunch, by and large my own assessment that credit is broadly available in the economy. and i would agree with much of what you said when it comes to mortgage credit. thanks at this point are reluctant to lend to borrowers with lower like those wars - --fico scores. their concerns about the risk and it is difficult for any homeowner who doesn't have pristine credit these days to get a mortgage. that is one of the factors that is causing the housing recovery to be slow. it is not the only one but i would agree with that assessment