Prior discussion:
speaker: VICE CHAIRMAN MCDONOUGH.
text: We need to find a way to tactical symmetry--to a position where we, the public, and the markets think we are watchfully waiting but not looking for windmills to knock down. Because of the public perception of where we are, I do not think we can achieve tactical symmetry by taking no action at this meeting. However, when we discuss what action to take in a later portion of the meeting, tomorrow morning, I am absolutely convinced that it must take us to tactical symmetry, even against a strategic background of concern about inflation. Thank you. 
speaker: CHAIRMAN GREENSPAN.
text: President Poole. 

MR. POOLE. "We have the same situation in agriculture and so forth that has existed for some time and has already been commented on by others, so I have nothing to add."

Full utterance: Mr. Chairman, it's obvious that everyone around the table is "chafing at the bit" to discuss policy, and I'm going to do my part to behave in a disciplined fashion here by just discussing the outlook. In the Eighth District the story is very simple; it's the same old story. We're seeing exactly the same kinds of things that we have been seeing for a good number of months now. I make a special point of trying to talk to my contacts about what seems to be different, what seems to be on the radar screen that hasn't been there. My impression is very clearly that firms are successfully managing their labor market pressures. For example, is very concerned about the labor market situation for his company. He says that its needed employees at the Louisville hub. He says that the company is having a hard time all around the country--except in Philadelphia, Ed, by the way. He says he's having no problem in Philadelphia; I don't know why the situation there is different. higher hiring referral bonuses and retention bonuses. So, clearly, that company is concerned. On the other hand, who was quite concerned about his labor situation earlier in the spring, says that now his folks are able to find labor pretty readily though they are behind on IT staffing. What seems to be happening is that case-by-case firms are coming up against the labor market pressures and they are able to manage the situation successfully. Of course, managing the situation in some cases means that they are paying more wages or retention bonuses or something, so there's perhaps some up-creep in wages involved, although obviously it is not showing up in the national statistics. Another thing that has come on our radar screen is that our bank examiners are expressing a little concern--I want to emphasize it's a small degree of concern--about loan administration in the banks. Credit demands are strong enough and loan officers are in tight enough demand that our examiners have the sense that some of the banks they examine are simply not able to have disciplined loan administration. So there may be a bit of sloppiness in that area that could produce some problems later on. No one is very concerned about it, but I mention it because it was the first time I really had heard about that from our examiners. We have the same situation in agriculture and so forth that has existed for some time and has already been commented on by others, so I have nothing to add.

Opinion: no