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tv   Janet Yellen 3 Percent Growth Quite Challenging  CSPAN  July 13, 2017 11:34am-11:44am EDT

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during their celebration. we'll have that live at 12:30 eastern here on c-span 3. right now we'll go back to this morning's hearing with federal reserve chair janet yellin appearing for a second day on capitol hill. as she speaks to the senate banking committee about the country's economy. >> promoting economic growth remains a top priority for this committee and congress. i've been encouraged to see federal agencies and stakeholders evaluating current laws and regulations. since the last humphries hawkins hearing in february, there have been numerous developments that will impact economic growth legislation. senator brown and i have solicited the public for economic growth proposals and more than 100 submissions from stakeholders have come in. they are listed on the committee's website for those who may be interested and we're working together now to put together legislation dealing
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with it. the committee has held numerous hearings focused on economic growth with financial companies and regulators. federal financial regulators issued their second report and the treasury department issued it first report on core principles of financial regulation. in addition, members on both sides of the aisle have expressed interest in finding ways to help our economy improve. support for bipartisan legislation promoting economic growth continues to build. particular interest has been focused on finding bipartisan solutions to tailor regulations, change the threshold exempt certain firms from stress testing, fix the volcker rule and simplify small bank capital rules. a few of many issues raised to the committee in recent months. imposing enhanced standards designed for the most complex systemic firms on institutions that are not systemic has real world implications.
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i regularly hear from idaho businessmen and women concerned about access to business loans that would create jobs and promote a healthy economy. the $50 billion threshold particularly is an area which we should kraes. there are different ways enhanced standards could be applied at all too many have questioned whether the $50 billion threshold is appropriate. chair yellin and governor reserve powell, acting crom controller, former federal reserve governor and former comptroller curry have expressed support for changing $50 billion threshold. in addition to the $50 billion threshold governor powell shared specific areas where the fed believes some laws and reg glazes can be changed to alleviate burden including the volcker rule, stress tests and resolution plans, among others. i look forward to working with the fed on these issues and welcome any additional color
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that you chair yellin can provide on areas where the fed and congress may act together to further reduce burden. with respect to housing reforming the housing finance system is one of my key priorities this congress. i've repeatedly stated the status quo is not a viable option. the current system is not in the best interest of consumers, taxpayers, investors, lenders or the broader economy. i was encouraged the federal reserve governor powell gave a speech last week in which he said that the status quo is unsustainable. he also noted that as memories of the crisis fade, the next few years may present our last best chance to finish these critical reforms. with respect to monetary policy the fed has raised interest rates four times since 2008. overall the fed maintains an accommodative monetary policy with a balance sheet that stands at $4.5 trillion in assets.
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last month the federal open market committee issued an addendum to its policy normalization principles and plans detailing how the fed will gradually reduce its assets. i welcome more comments from chair yellin about the state of the economy and the path of monetary policy. the committee continues to work to find bipartisan fixs to address many issues outlined here today and i look forward to working with chair yellin, the federal reserve and the members of this committee. senator brown. >> thank you, mr. chairman, for holding this hearing. it is wonderful to have you here and thank you for your service. since your last appearance before this committee the fed has increased the federal funds rate twice, employers continue to create jobs, although a slightly slower pace than last year, and wages have increased modestly. the fed continues to lay out its plans to sell off security that it purchased during the crisis, the biggest banks are making
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record profits, important to remember that, the biggest banks are making record profits, just past the fed's 2017 stress test. at the same time too many americans continue to struggle to make ends meet, worry their children will not have the economic security they once had, life expectancy in many parts of the country is falling, something more or less unpress tented in recent history. that tells us something about our economy. so i'm troubled by what i'm hearing from the administration, from some republicans and from some in the banking industry. even though a fifth of homeowners with a mortgage are still seriously under water in cities across ohio, you and my colleagues have heard me say on this committee that the zip code my wife and i live in in the city of cleveland, 44105 had ten years ago more foreclosures the first half of that year than zip code in the united states of america. i see the difficulty that people
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in my neighborhood and my zip code have in rebuilding their lives. even though the wealth gap between white and black families has widened the administration seems to want to let wall street gamble with the financial futures of working families once again. cutting protections and for working americans is back in style in parts of washington from the treasury department's report to the financial choice act to the house's financial appropriations bill, we face a slate of nominees for watchdog politicians who are with great apology to president lincoln who are of wall street, by wall street, for wall street. ten years ago chairman bernanke sat in the seat you occupied after describing the economic conditions in the housing and business sectors he told our committee, he spoke about concerns about subprime mortgages and global economic trends an consumption and labor data but concluded, quote,
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overall the u.s. economy, this was ten years ago, overall the u.s. economy appears likely to expand at a moderate pace over the second half of 2007, with growth then strengthening a bit in 2008. we must not forget what actually happened next. the financial devastating financial crisis. working families in ohio and nevada and maryland and arkansas and all over working families across this country can't forget that. they're still digging out. nor can we forget it collective amnesia on this panel aside. i mention this not as a criticism of chairman bernanke, he had plenty of company in missing the signs of an impending crisis and collapse but when it happened he took aggressive action, all of you did, to confront the crisis. he learned the lessons that came at such a high cost. after the crisis we put rules in place that strengthen the capital position of the banks, provided more stable liquidity,
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improve protections for consumers and for taxpayers. lobbyists are using the success of these reforms as proof that they should now be gutted. they're arguing the results of the fed stress test prove that we can now relax the rules. having passed the test once, they want to make the test easier. i'm sure every college student you taught in your long distinguished academic career, madam chair, i'm sure every college student you taught and struggled in class would have wanted the same thing, but they unlike our nation's biggest banks, would have been too embarrassed to ask their professor. the financial crisis was caused in part by watch dogs who were busy focussing on bank profit instead of insure banks treating their consumers fairly and had enough capital to weather a downturn. everyone can agree there are parts of wall street reform that could be improved. of course there are. our focus should be on growing a stronger economy for everyone and every part of the country,
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from idaho to ohio and beyond and particularly in communities too often forgotten in this town, that means protecting consumers and improving the economic security of communities of color and strengthening the working and middle class families who felt the devastation the most, the devastation of 2008's financial crisis. it means lowering the cost of health care and investing in infrastructure and expanding educational opportunities and job training. that's how you spur long-term economic growth that lifts up all americans. whether instead weakening safeguards to boost bank profits, in crossing our fingers that wall street will invest some of those profits in the real economy we hope, we hope instead of just passing it along to their shareholders won't prevent another crisis, only hasten the next one. madam chair i look forward to hearing your answers to our questions. thank you. >> i'll begin and first chair yellen, in a sh


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