Prior discussion:
speaker: MR. STERN.
text: I don't have a very different view as to how things will turn out. I would reemphasize the point that has been made that it is by most comparisons a very conservative forecast, and it wouldn't be altogether shocking to me if the economy did somewhat better than that. The one thing that does trouble me a bit, looking at the national circumstances at the moment, is the state of the long-term bond market where clearly nothing favorable has been happening in recent weeks. Indeed, rates are at the levels they were before the discount rate cut back in December. 
speaker: CHAIRMAN GREENSPAN.
text: Governor Kelley. 

MR. KELLEY. "If there's anything to that, layoffs are going to decline and that should help confidence."

Full utterance: Mr. Chairman, I have very little substantively to try to offer today, but I would like to put out one notion. I am struck by the very strong consensus that I read in the press--and indeed it seems to be here as well--that the economy is likely to be "flattish" in the first quarter, that it will be a little better or that a recovery of some magnitude will occur in the second quarter, and that the economy then will move on up from there. I share that view. What worries me is that I have a bit of the contrarian in me, and I ask myself: If we have this very strong consensus, it's probably wrong, but in what direction and how? Is it too strong or too weak? Again, I'm part of the consensus, but my suspicion is that we could very well see events prove to be on the stronger side. If we were going to have a collapse, it seems to me that it would likely have been evident in the fourth quarter and would be underway now, and I don't sense that it is going on now. And the longer that doesn't appear, it seems to me the less likely that it will. It's probably too soon to rule it out, but [more strength than is projected] would seem to me to be the way things are liable to go. We have some things going for us already that should help, maybe more than we know. The short-term rates and the monetary stimulus that's in the pipeline should help. The refinancing of homes is putting more spendable income into the pockets of people every day. And I wouldn't be a bit surprised if this little uptick in long rates doesn't accelerate that [development]; and it might accelerate home sales as well. I'd also bet that the white collar layoffs have seen their peak. I think most CEOs who felt the need to lay off workers probably wanted to be able to report it in their year-end statements and got it done in the fourth quarter. If there's anything to that, layoffs are going to decline and that should help confidence. The credit crunch may be beginning to ease and the bank crisis may be beginning to ease. We're hearing here today and we read that banks are looking for good loans. My suspicion is that if they look, they're going to find them along the way. Fourth-quarter earnings of banks were better; their stock prices are up; and the loan officers' survey says that nobody is tightening anymore. So, maybe we will begin to get some relief there, although I don't think it's going to be very dramatic very quickly. On balance, I'm with the consensus but if the consensus does prove to be wrong, I think it's going to be on the up side.

Opinion: yes
About monetary policy: no