Thank you. It’s a particular pleasure to be with you this morning. The subject of my talk today is the outlook for the economy and Federal Reserve policy. I’ll start with a look at the national economy, focusing on why the recent recession was so severe and why the recovery has been relatively anemic. I’ll then talk about prospects for growth, employment, and inflation. Finally, I’ll discuss what the Federal Reserve is doing to bolster the recovery. My remarks represent my own views and not those of others in the Federal Reserve System. Let me begin by saying that I’m encouraged by recent signs of a stronger, self-sustaining recovery. I’m especially glad to see that the economy is adding jobs at a pretty decent clip. Still, we have a long way to go. The Fed’s mandate from Congress is to promote maximum employment and stable prices. 1 Inflation generally has been subdued over the past few years. But, more than four years after the recession began, the unemployment rate is still 8.3 percent, leaving us far short of our employment goal. The Fed has acted vigorously to boost the economy. It’s critical that we keep doing so in order to achieve our statutory mandate. I’d like to start with a little bit of history. We are in the aftermath of the worst financial

Thank you. It’s a particular pleasure to be with you this morning. We live in a rapidly changing and ever-more-competitive global economy. It’s vital that every region understand and leverage its special attributes and competitive advantages. SPUR has long been on the forefront of thinking about these questions for San Francisco. We’re very lucky to have such a far-sighted group working to keep our city successful. Of course, it’s not possible to make sense of what happens in the Bay Area without considering the larger economic environment in which we are situated. So this morning, I’m going to talk about that broader economic context. I’ll start with a look at the national economy, focusing on why the recent recession was so severe and why the recovery has been relatively anemic. I’ll then talk about prospects for growth, employment, and inflation. Finally, I’ll discuss what the Federal Reserve is doing to bolster the recovery. My remarks represent my own views and not those of others in the Federal Reserve System. Let me begin by saying that I’m encouraged by recent signs of a stronger, self-sustaining recovery. I’m especially glad to see that the economy is adding jobs at a pretty decent clip. Still, we have a long way to go. The Fed’s mandate from Congress is to promote maximum employment and stable prices. 1 Inflation generally has been subdued over the past few years.