Post-Gaming the Fed Decision with Alan Greenspan
(Bloomberg) -- Federal Reserve chair Jerome Powell was not dovish enough for markets. The U.S central bank brushed off the past week of market turmoil and political pressure from President Donald Trump -- raising interest rates for the fourth time this year. Policy makers signaled they may ease monetary tightening -- trimming the number of rate hikes from three to two in their forecast for 2019. On What'd You Miss This Week, Scarlet Fu along with Tom Keene got immediate Federal Reserve decision analysis from Alan Greenspan.
The former Federal Reserve Chairman offered his economic outlook. "I don't think the recession call is exactly right," he said. "But, it is certainly the case that when you look out over the horizon, the forces that have been driving productivity growth to ever slower paces up until very recently are going to continue." Greenspan cited the rise of entitlement spending as the culprit holding back the U.S. economy from increased productivity, and by extension sustained economic growth.
For the former Federal Reserve Chair, Washington provides another hindrance to economic growth. "I think the economic outlook is being significantly affected by the poor politics," he said. Greenspan said the current state of politics in the U.S. is unlike anything he's ever seen. “I was in the U.S. government for almost 20 years and I’ve never seen anything remotely close to what we’re observing today.”
Matthew Patsky, the CEO of Trillium Asset Management, which holds an $11 million stake in Facebook, came on to talk about the rough week for the social media platform. Patsky, whose firm began advocating last month for Facebook to split the Chairman and CEO role, said the level of privacy breaches has gotten much worse than they thought. "We're certainly hoping that they take action," he said. Patksy cited the company's corporate governance structure and Mark Zuckerberg's supermajority control as both the source of the problem and a constant roadblock to corrective action. "If Mark Zuckerberg doesn't agree to it, there's a problem getting anything done," Patsky said. "We got here because Mark Zuckerberg reports to Mark Zuckerberg, and there needs to be some control systems in place."
The cannabis industry got another splashy deal with a legacy name this week. Tilray announced they were going global with the help of a division of the Swiss drug giant Novartis, which would allow the cannabis company to develop and distribute medical marijuana industry around the world. Vivien Azer, a senior research analyst at Cowen & Company, joined to discuss the importance of this deal. Azer, who the first senior Wall Street analyst to cover the emerging cannabis sector, said the move was incredibly encouraging and validates the use cases for cannabis on a global scale. "What's really differentiated is that Tilray is really the only large public Canadian LP that is really focused on pharma as a strategic partner."
Then Paula Glover, CEO of the American Association of Blacks in Energy, sat down with Scarlet Fu to talk about her work increasing diversity in the energy sector in both employment opportunities and policy decisions. The recent plunge in oil prices is good news for American consumers, because it means lower household expenses. One-third of U.S. families are already having trouble paying those utility bills, especially in low-income communities. "There's an enormous energy inequality and what I would describe as energy poverty," Glover said.
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