An Update on the Economy and the Federal Reserve’s Policy Response; 05.12.20 Loretta J. Mester: POWER Series, CFA Society Chicago, Chicago, IL (via videoconference)

The coronavirus pandemic is a global public health crisis that has inflicted pain and hardship on people all over the world. In the interests of public health, the country has taken aggressive social distancing measures to limit the spread of the virus, resulting in a shutdown of much of the economy. While the shutdown has yielded public health benefits, its effects on the economy have been swift and severe. Unprecedented times require unprecedented actions. Both the federal government and the Federal Reserve took action quickly. These relief efforts can be viewed as building a bridge to get households and businesses from the generally good economy we had in February to the other side of the pandemic shutdown period. The shutdown period has lengthened over time, driven by the course of the disease. So the bridge has to be longer than first assumed, and it also has to be wider, as more households and firms are in need of some kind of help.