Federal Reserve press conference, 2020-04-29 — Chair Jerome Powell

Question (Steve Liesman, CNBC): Mr. Chairman, question—Steve Liesman with CNBC. I’ve got two questions here. First of all, why aren’t you announcing or conducting a specific quantitative easing program? And—and maybe you could explain what the context is now of the purchases that will be made and the amounts that are to come. The second question I have is, are—is the Federal Reserve really taking enough risk to help households and businesses here, in that you just said that the programs that are out there may be best for those who are able to repay loans. But—so don’t you have a series of programs essentially lending only to those able to repay, which is essentially helping those who may need it the least? Thank you.
Answer: So, let me say again, in terms of—of asset purchases and—and other measures, we—we do think our—our policy stance is appropriate now. We’ve had discussions, as I’ve mentioned, over time and done quite a bit of thinking about what we might do in the future. We think, for now, our policy stance is appropriate. We’re not going to change it now. And we’re really waiting to see more from the economy. There are a range of potential paths the economy could be on, and I think as—as the time approaches for—then we’ll—you know, we’ll address your first question, which is about asset purchases. So—but that’s not something we’re doing today. It’s—it’s something that we have talked about, and, you know, for now, we like our current policy stance. In terms of risk, so, you know, we operate under the laws that Congress passes. And there are a number of aspects under section 13(3), and you can see that they’ve permitted us to, I think, move very quickly and move into areas where we’ve never been before and do so quite aggressively. So I—I think we’re going places and providing help in places where we never have, and I’m glad that we are. I think it’s appropriate that we are. Nonetheless, these are lending powers. And if you read section 13(3) of the Dodd- Frank—or, the Federal Reserve Act, and I know you have, it does require that—that we be secured to our satisfaction, and—and we can’t lend to insolvent companies. You know, it’s clear these are lending powers, and we are—we are ultimately bound to—to implement the laws that Congress gives us. We—we do not make grants. We can’t make grants. And I—the reason I raised that in my remarks is that I just want to be clear on that. We—you know, we can do what we can do, and we will do it to the absolute limit of those powers. We will—we’ll keep at it. And you—I just want people to know that we’ll—we will be at it with—with the legal authorities that we have until we get through this thing. We will keep using our authorities. But there are authorities that we don’t have, and there may be a need for those authorities to be used as well as ours.