jerome h powell : opening remarks – “ perspectives on maximum employment and price stability " opening remarks by mr jerome h powell, chair of the board of governors of the federal reserve system, at “ perspectives on maximum employment and price stability ", a fed listens event sponsored by the board of governors of the federal reserve system, washington dc, 4 october 2019. * * * good afternoon. welcome to the room where members of the board of governors and the presidents of the 12 reserve banks meet eight times a year — most recently, two weeks ago — to decide the stance of monetary policy. it ’ s a magnificent, formal — perhaps even imposing — room, with 26 - foot ceilings, a monumental marble fireplace, and a 1, 000 - pound brass and glass chandelier. it ’ s seen a lot of history since franklin roosevelt dedicated this building in 1937. british and american military leaders conferred here during world war ii. and, through the decades, our federal reserve predecessors grappled with financial turmoil and the economy ’ s ups and downs. so when my colleagues and i take our assigned places around this polished mahogany and granite table, the setting and its history lends a certain formality — dare i say, stuffiness — to the proceedings. as we kick off this 12th of 14 fed listens events, governor brainard, governor bowman, and i hope that today ’ s meeting is anything but stuffy. candid and serious, yes. but not stuffy. the reserve banks and the board have been holding fed listens events around the country as part of a comprehensive and public review of our monetary policy strategy, tools, and communications practices. almost all of the fed listens meetings, like this one, have been open to the press and live - streamed on the internet. both the breadth and transparency of the review are unprecedented for us. one reason we are conducting this review is that it is always a good practice for any organization to occasionally take a step back and ask if it could be doing its job more effectively. but we must pose that question not just to ourselves. because congress has granted the federal reserve significant protections from short - term political pressures, we have an obligation to clearly explain what we are doing and why. and we have an obligation to actively engage the people we serve so that they and their elected representatives can hold us accountable. we ’ ve invited you here because we want to better understand how monetary policy affects the lives of the people your organizations represent — union

fellow board members and i know that community banks provide essential financial services to households, small businesses, and farms in communities throughout the country. we know that community banks serve many customers that large banks do not and provide services that are not offered by large banks in many communities. this circumstance is especially true in rural areas and other small communities, where community banks are sometimes the only retail financial institutions. we understand that community bankers serve members of their local communities who are not just their customers, but also their neighbors and their friends. we know the strong links these banks have to the people and businesses in their communities provide firsthand knowledge of local economic conditions. my colleagues on the board understand, as i do, that these close ties give community bankers special insight and understanding into local needs so that they can tailor their products and services to meet those needs. although community banks largely kept to their traditional business model of prudent, local lending and avoided the excessive risk - tasking that helped fuel the financial crisis, that crisis, and the deep recession that followed, devastated many communities and the banks that serve them. the significant improvement in the economy since then has helped communities bis central bankers ’ speeches and community banks, but i am well aware that the challenges for this sector continue, and my board colleagues understand this also. we know and appreciate these concerns because the board makes it our business to regularly and extensively meet with and talk to community bankers and industry leaders. the board of governors meets twice a year with the community depository institutions advisory council, which includes representatives of community banks, thrifts, and credit unions in each of the 12 federal reserve districts. 1 the board also has a subcommittee on smaller regional and community banking, headed by governor powell and including governor brainard. 2 let me also say that the experiences, aspirations, and challenges of community banking are not new to me. before i became chair of the board of governors and vice chair before that, i spent six years as president of the san francisco fed. in this role, i was responsible for the supervision of a substantial number of community banking organizations in the nine states of the 12th district. among the things i learned from that experience is that, when it comes to bank regulation and supervision, one size does not fit all. to effectively promote safety and soundness and ensure consumer compliance without creating undue regulatory burden, rules and supervisory approaches should be tailored to different types of institutions. that is why the congress chose to exempt community banks from many aspects