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Proposal to the FOMC

Proposal to the FOMC. Current Economic Situation & Dual Mandate Performance. Source: Bureau of Economic Analysis; Congressional Budget Office . Underemployment & Unemployment Elevated. Source: Bureau of Labor Statistics. Long-Term Unemployment Especially Problematic.

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Proposal to the FOMC

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  1. Proposal to the FOMC

  2. Current Economic Situation & Dual Mandate Performance

  3. Source: Bureau of Economic Analysis; Congressional Budget Office

  4. Underemployment & Unemployment Elevated Source: Bureau of Labor Statistics

  5. Long-Term Unemployment Especially Problematic Source: Bureau of Economic Analysis; Congressional Budget Office

  6. Inflation Remains Stable Source: Bureau of Economic Analysis; Federal Reserve

  7. Inflation Expectations are Well Anchored Lehman Brothers Bankruptcy Source: Federal Reserve; Federal Reserve Bank of Philadelphia

  8. Dual Mandate Performance

  9. Economic Headwinds

  10. Source: Thomson Reuters/University of Michigan

  11. Investors Lack Confidence in Corporate Debt Source: Board of Governors of the Federal Reserve

  12. Businesses Lack Confidence in Recovery Prospects Source: Bank of America Merrill Lynch, Board of Governors of the Federal Reserve

  13. “Fiscal Cliff” Poses Broad Macroeconomic Risks Source: Congressional Budget Office

  14. European Debt Crisis Under Control, For Now Source: International Monetary Fund

  15. Source: Bureau of Economic Analysis

  16. Source: Census Bureau

  17. Source: Board of Governors of the Federal Reserve

  18. Source: Standard & Poor’s

  19. Conclusion

  20. Current Fed Policy: “If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability.” Source: FOMC Statement, October 24th 2012

  21. Our Policy: “If the unemployment rate remains above 7% and core inflation remains below 3%,the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy toolsas it sees fit. ”

  22. Policy Goals:

  23. Further Guidance Occurs If:

  24. Inflation will remain controlled

  25. Summary:

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