Although we work through financial markets, our goal is to help Main Street, not Wall Street.
Janet YellenRead
If strong economic conditions can partially reverse supply-side damage after it has occurred, then policymakers may want to aim at being more accommodative during recoveries than would be called for under the traditional view that supply is largely independent of demand.
Interpretation
What this quote means
Policymakers should consider being more supportive during economic recoveries, as strong economic conditions can help recover from past supply-side damage.
In this quote, Janet Yellen suggests that traditional economic views may underestimate the interplay between supply and demand during economic recoveries. Instead of treating supply as separate and independent from demand, she argues that creating accommodative policies during recoveries can help to leverage strong economic conditions to heal supply-side issues that have arisen in the past.
Themes
EconomicsPolicymakersSupplyDemandRecoveries
In practice
Example use cases
In an economic conference discussing how to respond to recessions and recoveries.
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Inequality has risen to the point that it seems to me worthwhile for the U.S. to seriously consider taking the risk of making our economy more rewarding for more of the people.
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