Fed Reserve hears from Main Street
Americans are worried and several witnesses told Fed Chairman Jerome Powell on Friday of the challenges they face in an uneven economic recovery.
Powell and other policymakers heard a myriad of concerns at a virtual “Fed Listens” event. Concerns included missing house payments, the need for businesses to return to pre-pandemic levels, workforce issues and a supply chain crisis.
In its opening Remarks, Powell told listeners, “Most of you are grappling with altered workplaces, from safety protocols with unclear half-lives, to fundamental changes in how your industries operate, from l feeding people when they come out of the movies. “
“The business plans have been reworked, the outlook has been revised and the future remains tainted with uncertainties.”
Powell and policymakers mainly listened during the hour-long event and did not describe any new economic or monetary policies.
The economy and the lasting impact of the pandemic on economic recovery were at the forefront in the minds of community and business leaders.
Mortgage loans in arrears
Patricia Garvia Duarte. the chief executive of an Arizona-based nonprofit that helps low-income residents buy homes is worried about delinquent mortgages for low- to moderate-income people.
Small business still struggling
Small business owners have told Fed policymakers they are still struggling to keep the doors open.
North Carolina restaurateur Cheetie Kumar recounted how her small, family-run restaurant in Raleigh struggles to stay open before adding, “We can’t keep getting into debt.”
She explained that the restaurant, the Neptune’s Parlor, which she owns with her husband, has hiring problems because workers worry about Covid and find childcare issues that cause some to change careers .
The missing links in the supply chain
A few links are still missing in the supply chain, said Gina Dingman, president of Everest Real Estate Advisors in Minneapolis, Minnesota.
She said prices remain high, impacting all businesses from manufacturing to construction.
She said, âDevelopers now have to go out 12-18 months to get devices for construction. Sometimes buildings are ready for delivery to tenants, but there are no devices because we hadn’t anticipated the supply chain issues.
Chad Moutray, chief economist for the National Manufacturers Association, agreed, saying supply chain issues and higher costs are expected to last until 2021.
“It is clear that some of these costs are going to remain quite high compared to pre-pandemic levels, including wages once they increase they are unlikely to come down again,Â», Declared Moutray.
Powell was joined by vice president of oversight Randal Quarles and governors Michelle Bowman and Chris Waller.
The president told the group that the central bank was reviewing “tons and tons of data.” Still, âit doesn’t really live on for us until we hear your stories. “
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