Confidence is a key part of what's happening in the economy and the market. You shouldn't underestimate the importance of symbolic moves like these.
Confidence is a key part of what's happening in the economy and the market. You shouldn't underestimate the importance of symbolic moves like these.
At a minimum, this will hit consumers' pocketbooksand perhaps their confidence. Before Katrina, Goldstein estimated that consumers' annual fuel bills this year would average about 250 more for gasoline and 400 more for home heating oil and natural gas than in 2004. Now he reckons those amounts will go up 30 percent to 75 percent. Costlier energy could adversely affect consumer spending, corporate profits and inflationor all three. We could be reaching a tipping point on consumer psychology, especially when people get their home heating bills, ... Those will be big.
Consumers are reeling from the high energy bills and that has to be watched very carefully. Another month of falling consumer confidence would be disturbing.
The Fed chair doesn't matter a lot to the average person in normal times. He matters an awful lot when things aren't going well -- when the financial markets freeze, or there's a 911 or Y2K or Iraq war. When people lose confidence, the Fed chairman is vital to restoring confidence and ensuring functioning financial markets and economy.
© 2020 Inspirational Stories
© 2020 Inspirational Stories