The financial system today is much stronger today than 10 years ago, when the financial crisis began, and in better position to handle needs of both households and businesses – largely through efforts of the Federal Reserve, the chairman of the board of the central bank indicated Thursday.
“Ten years have now passed since the depths of the financial crisis — a painful part of our history that cost many Americans their jobs, their homes, and, for some, their hopes and dreams,” Fed Chairman Jerome H. (Jay) Powell said in remarks at the Rhode Island Business Leaders Day in Washington, D.C. “In addition to holding interest rates low to support the recovery, we have taken many steps to make the financial system safer,” he said.
Powell pointed to, in particular, holding the largest banks to higher standards in the amount of capital and liquidity they hold and in the ways the banks assess and manage the risks they take.
“I am confident that the system today is stronger and in a far better position to support the financial needs of households and businesses through good times and bad,” Powell told the assembled business leaders, according to his prepared remarks. “We continue to work to sustain these fundamental improvements while also ensuring that regulation is both effective and efficient.”
He earlier in his remarks noted the “very good signs” of a strengthening economy: growth at a “healthy clip,” low unemployment, rising number of people working, higher wages, inflation low (and stable). But not everything is perfect, he said.
“The benefits of this strong economy have not reached all Americans,” he said. “Many of our country’s economic challenges are beyond the scope of the Fed, but we are doing all we can to keep the economy strong and moving forward. That is the best way we can promote an environment in which every American has the opportunity to succeed.”