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STEVE CHIOTAKIS: Right now we’re gonna ask the big question, on this day the Federal Reserve meets to discuss monetary policy. The central bank will look at whether there’s anything left to be done to kick-start a very slow recovery. David Weiss is chief economist at S&P. He’s with us live from New York this morning. Hi David.
DAVID WEISS: Hi. Good morning.
CHIOTAKIS: All right. What’s the Fed looking at as it pertains to policy decisions they may make? What are some of the numbers that they’re looking at?
WEISS: Well, the last six weeks, the numbers have been coming in a little bit better. It looks like definitely like there’s a recovery is going on, it’s just a very slow recovery. Housing starts this morning were just the latest example of numbers coming in a bit better than expectations.
CHIOTAKIS: What are the Fed’s options, David? They can’t take interest rates much lower. What else can they do?
WEISS: They can’t take interest rates below zero. Their option is quantitative easing, which means lowering other interest rates rather than just short term by buying long-term government bonds, mortgage-backed paper, corporate bonds and anything else they can find.
CHIOTAKIS: I want to ask you about this report that came out yesterday, saying the recession ended in June of 2009. Is that a testament, do you think, to Fed policy of the past or maybe just a bit of luck?
WEISS: Well probably some of both. It’s mostly natural timing of the cycle. Eventually recessions end because people have to start spending money again. Timing’s about right. It always takes the NBER about a year to determine that the recession’s over.
CHIOTAKIS: All right. David Weiss talking to us from S&P. David, thanks.
WEISS: Thank you.
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