lisa d cook : remarks to delta sigma theta speech by ms lisa d cook, member of the board of governors of the federal reserve system, at the " 110 years of deltas embracing the past while shaping the future " event, norfolk, virginia, 21 january 2023. * * * happy founders day, virginia sorors! i recently came across a picture of myself in seventh grade at the county social science fair. it appeared in the milledgeville, ga., union - recorder newspaper, which, mercifully, does not have an online photo archive. i did not know it at the time, but that social science fair picture is a milestone in my own journey, a path that has both intersected with and run parallel to those of delta as a whole and to one soror in particular - our first president, dr. sadie tanner mossell alexander. i had learned about sadie t. m. alexander the year before, when my mother initiated the nu tau chapter of delta on the campus of georgia college and state university, where she was the first tenured african american faculty member. i heard conversations about all the delta presidents, but dr. alexander struck a particular chord with me. i was fascinated by her life and work - partly for her intellect and determination, but also for the clarity she brought to my own understanding of research and its possibilities. my mother, mary murray cook, and aunts, dr. loretta murray braxton and wivona murray ward, were professors and teachers in stem ( and all deltas! ). i am grateful that aunt vone, a math teacher in the norfolk public school system for 35 years, is here with us today. as a sixth grader growing up on a college campus, i had always understood academics as essentially split between the hard sciences the women in my family taught and the humanities. sadie t. m. alexander's work imparted three important lessons that would act as a compass. first, she helped me discover the world of social sciences, an academic middle ground with the structure of the hard sciences and the seemingly infinite research possibilities it contained. second, she showed me not just what could be studied, but what kind of questions should be asked. third, she helped me understand that how we search for answers matters as much as the question itself. each of these settled on, and stayed with, me in different and illuminating ways. the first lesson was like a lightbulb - immediate, clear,

course of last year. if financial market participants appeared to be expecting policy firming to begin somewhat sooner than policymakers considered desirable or appropriate under such circumstances, the language of the forward guidance could be adjusted to shift expectations toward the somewhat longer horizon over which the committee expected the federal funds rate to remain extraordinarily low. figure 3 illustrates the potential for such a change in forward guidance to support economic activity. in the left panel, the dashed line denotes the baseline path for the federal funds rate as embedded in current financial market data, while the solid line corresponds to an alternative path in which the initiation of policy firming is postponed by one year. if policymakers viewed that alternative path as appropriate and market participants came to share that view, then financial conditions would become significantly more accommodative, even in the absence of any change in the current level of the funds rate. as shown in the right panel, a simulation of the frb / us model – a macroeconometric model developed and maintained at the federal reserve board – indicates that such a shift in policy expectations would be associated with a lower trajectory for the unemployment rate ( solid line ) and a somewhat higher path of core inflation ( dashed line ) over coming years. the effectiveness of asset purchases i will now turn to an assessment of the fomc ’ s program of longer - term securities purchases. both theory and empirical evidence suggest that asset prices and yields are affected not only by current securities purchases but also, importantly, by market expectations concerning future fomc securities holdings. this observation implies that central bank communications pertaining to any important feature of the path of the federal reserve ’ s balance sheet should influence financial conditions. event studies can therefore be helpful in gauging the financial market effects of such communications. 4 for example, table 1 reports the response of selected financial variables on several key dates associated with the fomc ’ s purchases of longer - term securities. in late november 2008, the federal reserve announced that it would purchase up to $ 600 billion in agency mbs and agency debt, and chairman bernanke provided further details in a speech one week later. on march 18, 2009, the fomc announced that the program would be expanded by an additional $ 850 billion in purchases of agency securities and by $ 300 billion in purchases of longer - term treasury securities. evidently, each of those communications was associated with substantial declines in longer - term nominal and real treasury yields and in rates on agency mbs and corporate