michelle w bowman : welcoming remarks - " fed listens " welcoming remarks by ms michelle w bowman, member of the board of governors of the federal reserve system, at the " fed listens : joining the labor force after covid, a discussion on youth employment ", hosted by the federal reserve bank of chicago, chicago, illinois, 22 august 2023. * * * thank you, president goolsbee. it is a pleasure to be here today to participate in our first in - person fed listens event in chicago since before the pandemic. i am really looking forward to being a part of today's conversation. when we began fed listens in 2019, the initiative was part of a broad, comprehensive review of the decisionmaking framework the federal open market committee uses when making decisions that impact the economy. since that time, we have met with people across the country from a wide range of backgrounds and perspectives, and we've learned about how our monetary policy actions affect them, their businesses, and their communities. in light of the insights we gained during those original listening sessions, we decided to expand the scope of fed listens to become an ongoing process of consultation with the public to better understand economic conditions from their point of view. these fed listens events provide us with a valuable opportunity to learn about the economy by engaging directly with those experiencing economic conditions. these conversations provide context for the economic and financial data that we monitor, and they help us look beneath the national - level data reporting to see how americans in different areas of the country are faring. so, again, i am very happy to be here in chicago with president goolsbee to learn about the topic of today's fed listens, which focuses on the experiences of young people as they enter the workforce. an important aspect of that transition to employment is whether young people are effectively prepared, and whether our economy has enough skilled workers to meet the growing demand. it's not possible for america to achieve sustained economic prosperity unless young people are equipped with the benefit of an effective education system and have access to opportunity. like many families during the pandemic, my family faced challenges with school closures and a lack of access to normal childhood activities and social interactions. as our education system works to address the lasting impacts of student learning losses and the increased emergence of mental health issues, it is critical that we recognize the challenges many are facing as they prepare to enter the workforce. the pandemic was a

stringent, forward - looking assessment of prospective losses and revenues at the 19 largest u. s. regulated financial institutions. we took the unusual, if not unprecedented, step of releasing publicly the methodology and findings of the scap, including the capital needs and loss estimates for the 19 institutions. the decision to make this information public was made in the context of a systemic crisis, in which markets were hungry for information and in which the treasury stood ready to inject capital into any of the 19 institutions that were found to need it. even so, it was much debated within the federal reserve, in part because of concerns that weaker banks might be significantly harmed by the disclosures. but i think that regularizing both stress tests and the release of information relevant to them deserves serious consideration for at least two reasons. first, in line with my earlier discussion of market discipline, releasing such information could assist investors in the difficult task of valuing loan portfolios that at present are not very transparent. second, releasing details about assumptions, methods, and conclusions would expose our supervisory approach to greater outside scrutiny and discussion. whether the result is critique or validation of our approach, the reaction of informed investors and analysts to our assumptions and methods would be beneficial. i have previously identified several ways we might increase the transparency of our stress tests. 2 there are doubtless additional possibilities. there are, to be sure, countervailing concerns. in economic times more normal than those prevailing when we conducted the scap, market participants will not be fearing the worst and banks will not have access to government capital injections as a backstop. at such a moment, the revelation that some major banks may have capital needs under a stress scenario might be unnecessarily destabilizing, though the possibility of this kind of market reaction may be lower if such information is released frequently. major unpleasant surprises would be less likely with see daniel k. tarullo ( 2010 ), “ lessons from the crisis stress tests ”, speech delivered at the federal reserve board international research forum on monetary policy, washington, march 26. frequent, detailed disclosures. in any case, i hope that interested parties will consider the merits of these possibilities and help advance the debate. there are other ways to incorporate non - governmental views into the regulatory system. we have already taken steps in this direction in conjunction with the federal reserve ’ s overhaul of its approach to supervising the largest financial holding companies. as part of this effort – and with the aim