Kansas City Fed President George: The economy is well-positioned to 'recover at some point'

Esther George, President of the Kansas City Fed, joined Yahoo Finance on the virtual sidelines of the annual Jackson Hole symposium to discuss the impact of the COVID-19 pandemic on the U.S. economy and how the Federal Reserve is responding.

Video Transcript

JULIE HYMAN: The Federal Reserve's Jackson Hole Conference is going to kick off tomorrow, virtually, of course. And in focus will be how monetary policy can respond to the COVID-19 crisis. Yahoo Finance's Brian Cheung has a preview of the conference alongside an interview with Kansas City Fed President Esther George. So Brian, any clues as what the Fed can do with rates already backed up to zero?

BRIAN CHEUNG: Well, Julie, if things were normal, I would be in Jackson Hole right now in the Grand Tetons reporting. But unfortunately because of the COVID-19 crisis, this Jackson Hole Conference, which happens every time around this year, has shifted to a virtual format. But it's also dominating the discussion during this conference, which would take place tomorrow and Friday.

More importantly, how will the Federal Reserve tweak its policy with rates already near zero, quantitative easing, and the number of liquidity facilities at its launch to make sure that the economy can rebound from this crisis? Here's what Esther George, the Kansas City Fed president said about how she views conditions in her district in the Midwest.

ESTHER GEORGE: Now, it's a great question. So my job as a regional Fed president is really to engage closely with all parts of the economy in my region. And we have never done that more than we have during the last five months. When sometimes our formal statistical data may look noisy to us, talking to people on the ground really can inform how we understand how the economy's unfolding.

And as I listen to the challenges they face across our region, I think it's important to remember we came into this with a strong economy. We had historically low unemployment. And that positions us better, I think, when we look at how we come out on the other side. So assuming we get the policy mix right, assuming that the medical issues can be addressed. I think the economy is well positioned to be able to recover at some point in the future.

BRIAN CHEUNG: So you can hear, again, Kansas City Fed President Esther George speaking right there that the economy will be able to recover at some point in the future. But you have to assume that the Federal Reserve and the Congress, this policy mix is going to be right in addition to the medical response. So a number of uncertainty there.

President George also speaking in our interview on a number of other topics, namely the concern with the path of the virus itself, saying that in her district, which covers part or all of seven states, including Colorado, Oklahoma, saying that the virus originally seemed to have a low amount of cases at first but seems like there's been some variation since that point in time.

Kansas, for example, seeing record numbers of coronavirus cases this week. So a lot of concern that the virus isn't necessarily contained, which could be a big obstacle in getting that US economic recovery. But, again, the Federal Reserve conference will be taking place tomorrow with a kickoff speech from Chairman Powell in the morning at 9:00 AM Eastern time while full coverage of that right here on Yahoo Finance.