Fed's Bullard holds virtual discussion on the economy
- Virus shock to US economy unlike any other
- main disruption to economy will be in Q2
- still feels main disruption to economy will be in Q2 if situation is managed properly
- Fed has intervened effectively to maintain financial market functioning, stave off crisis on that front
- US fiscal support has been quite strong
- Fed provided support so crisis doesn't become financial
- Europe is hit by virus: US is 2nd
- pandemic crisis a stress test for Euro and the European project
- economy does not have a pause button, if closures extend to long new problems will develop
- past pandemics have not necessarily led to a long period of economic decline at times followed by strong growth
- coronavirus testing could end the crisis
- government could pay production costs of tests
- broader testing, using existing technology, likely to end crisis sooner than waiting on a vaccine or other more complete remedies
- US cannot afford to stay on hold until there is a complete and total resolution of the virus such as a vaccine
- still possibly you get 20% unemployment
- would view 3rd quarter as a transition quarter
- hoping economy opens up with some confidence
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