Fed's 'U-Turn' on Policy Is a Prudent Change of Course, Dartmouth's Levin Says

The video discusses the economic changes over the past six months, highlighting zero net growth in core retail sales. It examines the Federal Reserve's response to these trends, noting a shift away from concerns of economic overheating. The Fed's balance sheet and its implications for future economic downturns are also analyzed, questioning the tools available for future interventions.

What has been the trend in core retail sales over the past six months?

• Fluctuating growth

• Zero net growth

• Significant growth

• Decline

What was the Fed's initial concern about the economy last summer?

• Recession

• Deflation

• Overheating

• Stagnation

How have interest-sensitive sectors been affected by the Fed's policy shift?

• They have remained stable

• They have grown rapidly

• They have collapsed

• They have become more sluggish

What significant change has occurred in the Fed's balance sheet compared to 10 years ago?

• It has no treasury securities

• It holds half of all longer-term treasury securities

• It holds fewer treasury securities

• It holds only short-term securities

What challenge does the Fed face in preparing for another economic downturn?

• Trade deficits

• Lack of monetary policy tools

• Excessive inflation

• High unemployment