Developments In Financial Markets Can

Over The Years, The U.s. Economy Has Shown A Remarkable Ability To Absorb Shocks Of All Kinds, To Recover, And To Continue To Grow. Flexible And Efficient Markets For Labor And Capital, An Entrepreneurial Tradition, And A General Willingness To Tolerate And Even Embrace Technological And Economic Change All Contribute To This Resiliency.

I Served Seven Years As The Chair Of The Princeton Economics Department Where I Had Responsibility For Major Policy Decisions, Such As Whether To Serve Bagels Or Doughnuts At The Department Coffee Hour.

While Rising Delinquencies And Foreclosures Will Continue To Weigh Heavily On The Housing Market This Year, It Will Not Cripple The U.s.

To Avoid Large And Unsustainable Budget Deficits, The Nation Will Ultimately Have To Choose Among Higher Taxes, Modifications To Entitlement Programs Such As Social Security And Medicare, Less Spending On Everything Else From Education To Defense, Or Some Combination Of The Above.

The More Guidance A Central Bank Can Provide The Public About How Policy Is Likely To Evolve The Greater The Chance That Market Participants Will Make Appropriate Inferences.