When will the next crisis hit?
It’s time to look at how the economy will perform in the coming years, according to a report released Monday.
The report, from the Center for Economic and Policy Research, was prepared by economists with the nonpartisan Federal Reserve Bank of St. Louis.
It is the first time the Fed has taken the step of releasing a report on economic forecasts, said Paul Volcker, who led the Fed during the crisis and now is its chairman.
It is not clear what will happen if the Fed begins a new round of quantitative easing, which it has been doing for nearly a year.
But Volcker said that could create a problem for markets.
If the Fed starts to raise rates too soon, Volcker predicted, there would be more downside risk for stocks.
“The market will go back to the fundamentals,” Volcker told reporters on a conference call.
This is a good time to buy stocks because we’re in the midst of the worst economic crisis since the Great Depression, he added.
Volcker also said that there was good news on the horizon.
The Federal Reserve said Monday that it expected growth in spending, the economy’s ability to recover from the recession and job growth in 2017 to be near their historical averages.
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