Prior discussion:
speaker: MR. FORRESTAL.
text: My hunch is, although our forecast and the staff forecast are based on no fiscal change, that we're going to get fiscal stimulus probably above what the President has suggested. And that suggests to me that the GDP forecasts are probably on the low side; if we get that fiscal stimulus, the economy will probably do better. Having said that, I do think our decision today should be based on our assessment of what the situation is going to be ex fiscal policy. Thank you. 
speaker: CHAIRMAN GREENSPAN.
text: President Black. 

MR. BLACK. "But on the other side of that, I think the substantial further easing in monetary policy we engineered in November-December could easily produce a more rapid recovery than we are expecting here, particularly if a fiscal package is enacted early in the year or relatively early in the year."

Full utterance: Mr. Chairman, I don't have much to add to this very excellent presentation the staff gave us and the fine coverage in the Greenbook. Our projections really are not significantly different. We do expect a little more real growth and a little greater slowing in the rate of inflation. But the broad profile is pretty much the same, with some pickup in the rate of increase of the recovery in the second quarter--but only to a very moderate rate in comparison with what has happened in past recoveries--and continued deceleration in core inflation, even though we are projecting that the overall CPI will come in a tad higher this year than it did last year. Insofar as the risks of error are concerned, I guess a carefully reasoned analysis would say that they are about equal on both sides. Certainly, there are some downside risks: the heavy overhang of commercial real estate; the corporate restructuring; the balance sheet adjustments that are taking place; the restraint on credit. Also, all these temporary dislocations that have taken place as a result of declining rates of inflation could produce another year of lower-than-expected growth. But on the other side of that, I think the substantial further easing in monetary policy we engineered in November-December could easily produce a more rapid recovery than we are expecting here, particularly if a fiscal package is enacted early in the year or relatively early in the year. For what it's worth, my instinct is that the upside risk is probably a little greater than the downside risk mainly because of the actions that we took in the fourth quarter. We engineered a very significant easing in policy; it has not at this point had a very positive effect upon the economy; the stock market really seems to think [it will] over the next several quarters. Moreover, we're seeing a decided change in the comments that we hear from our contacts around the District. There is not much hard evidence yet that things really have improved, but the outlook for the next six months or so is decidedly better than it has been over the several times we've made contacts; it's quite a shift away from what we heard [unintelligible]. It always seems to me that the pessimism is the greatest right at the bottom of a recession. So, since it looks a little better now than it did a while back, I hope that means that we're beginning to come out of this a little faster than most people seem to think.

Opinion: yes
About monetary policy: yes
Stance toward easing (NLI): contradiction