What Would a Trump Presidency Mean for Fed Policy?

The video discusses the influence of the President on economic policy, highlighting the Fed's focus on employment and price stability. It explores the economy's internal growth factors and the potential impact of fiscal stimulus on monetary policy. The discussion includes possible adjustments to monetary policy in response to fiscal changes and market reactions, emphasizing the uncertainty surrounding political decisions.

What are the two main factors that determine economic growth according to the Fed?

• Labor force growth and productivity

• Government spending and taxation

• Interest rates and inflation

• Stock market performance and consumer confidence

What is the Fed's legal mandate as discussed in the video?

• To manage the stock market

• To ensure high employment and price stability

• To control government spending

• To regulate international trade

How might a large fiscal stimulus affect the Federal Reserve's actions?

• It would lead to immediate interest rate hikes

• It could alter the Fed's forecasts and policy adjustments

• It would cause the Fed to lower interest rates

• It would have no impact on the Fed's policy

What is one potential outcome of implementing a fiscal stimulus according to Professor Blanchflower?

• Immediate reduction in interest rates

• A decrease in government debt

• An increase in unemployment

• The Fed selling off some of its assets

What is a concern for markets regarding the December decision mentioned in the discussion?

• The decision is irrelevant to market stability

• The decision will not affect interest rates

• The decision will definitely lead to higher taxes

• The certainty of the decision is only at 70%