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Fed Chairman Jerome Powell says Dogecoin and Gamestop Hype highlight ‘foam in stock markets’ – Economy Bitcoin News



Federal Reserve Chairman Jerome Powell discussed a number of topics this week, such as inflation and central bank digital currencies (CBDCs) following the multi-day Federal Open Market Committee (FOMC) meetings. The central bank’s chief executive was asked about feverish stocks such as Gamestop stocks and the cryptoactive dogecoin. Powell said the Federal Reserve aims to provide financial stability, but notes that there are some things in the capital markets that are a little frothy.

Fed chairman for inflation: Committee seeks inflation moderately above 2%

This week, FOMC meetings have shown that the US Federal Reserve plans to continue its policy easing policies until it is satisfied with the economic effects of the pandemic. The FOMC meetings were also followed by press conferences where Fed Chairman Jerome Powell answered questions from a variety of news agencies. Powell discussed benchmark interest rates and inflation, while also being asked about digital currencies and things like Gamestop stocks and the recent dogecoin (DOGE) rally.

First, Powell was inundated with questions about inflation, and a reporter stressed that some people think that “the Fed might let things get out of hand with the new political stance.” The reporter asked the Fed chairman whether the central bank would be able to get ahead of inflation before it gets well ahead of the 2% target. Powell noted that since the Fed has been able to maintain inflation below 2% for some time, he stressed that “the committee has been seeking inflation moderately above 2% for some time.”

Powell further noted:

[The Fed is] strongly committed to achieving our goal of maximum employment and price stability.

Despite China’s leadership creating a central bank’s digital currency, Powell says’ USD is still ‘the world’s reserve currency’

The Fed chairman was also asked about the US falling behind countries like China in the process of creating a central bank digital currency (CBDC). “We feel a commitment to understand the technology and all the political issues very, very well,” Powell said in response to the CBDC questions.

“The central bank’s digital currencies are now possible, and we will see some of them around the world,” Powell added. “And we need to understand if this is something that would be a good thing for the people we serve. How would it work in our system? And there are some very, very difficult questions to answer, and we are involved in a serious program to understand both the technology and the political issues. ”

The chairman of the Federal Reserve explained that the dollar is still very strong in his eyes, and he stressed that the USD is “the world’s reserve currency.”

“This means that the dollar is used in transactions all over the world, far more than any other currency. And it’s because of our rule of law, our democratic institutions, which are the best in the world, our economy, our hardworking people, all the things that make the United States the United States, ”Powell said.

Gamestop shares and Dogecoin

A reporter noted the hype that has surrounded certain markets such as dogecoin (DOGE) and Gamestop stocks. The journalist said people are looking for “returns in this market” and he wondered if the Fed felt responsible for the current financial stability in America. “Is there a concern about financial stability from the Fed’s perspective at this point?” the reporter asked the Fed chairman. Powell responded, saying that the financial stability that the Fed provides is quite broad, and the central bank does not skip over a particular topic and then moves on to the next.

“Financial stability for us is real, we have a broad framework. So we do not just jump from one thing to another, ”Powell replied. “I know a lot of people just look at asset prices and they look at some of the things that are going on in the stock markets, which I think reflects foam in the stock markets. But really, we are trying to stick to a framework for financial stability so that we can talk about it in the same way every time, and so that we can be held accountable for it, “the Fed chairman added.

Just as Powell has previously protected the mega-banks by referring to the so-called “strength” of financial founders, he positioned the Wall Street banks again as strong financiers this week.

“Utilizing the financial system is not a problem. We have very large capitalized large banks, ”Powell emphasized at the press conference.

What do you think of Jerome Powell’s comments about inflation, CBDCs and capital markets being frothy? Tell us what you think about this topic in the comments section below.

Brands in this story

2% inflation, America, CBDC, central bank digital currency, China, Doge, dogecoin, Dogecoin (DOGE), Fed, Fed Chair, Federal Reserve, Foam, GameStop, Gamestop stocks, inflation, jerome powell, US, USD

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