Straight From DC

Inflation, debt ceiling addressed as Yellen, Powell testify before Senate

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Federal Reserve Chair Jerome Powell said the Fed will consider acting more quickly to counter rising inflation and Treasury Secretary Janet Yellen reiterated the importance of Congress dealing with the debt ceiling. Their comments came as they testified in front of the Senate Banking Committee Tuesday.

The committee hearing came just days before the temporary suspension of the debt ceiling ends. Last month, Congress passed a bill that allows the government to continue paying its debts through Dec. 3. Votes on the matter came following a long standoff in the Senate over the debt ceiling.

“I cannot overstate how critical it is that Congress address this issue. America must pay its bills on time and in full,” Yellen said in her prepared testimony. “If we do not, we will eviscerate our current recovery.”

Last Month, Yellen warned that without a hike in the debt ceiling, the U.S. government could default on its debt obligations for the first time soon after Dec. 15.

“In a matter of days, the majority of Americans would suffer financial pain as critical payments, like Social Security checks and military paychecks, would not reach their bank accounts, and that would likely be followed by a deep recession,” Yellen said.

As Yellen discussed the debt ceiling, Powell was grilled by Senate Republicans on inflation, which Powell said himself, “will linger well into next year” in his prepared remarks.

“I’ve been warning about the risks of higher and more persistent inflation since January,” Sen. Pat Toomey (R-PA) said in his opening statement. “Unfortunately, the Fed has decided to continue its emergency monetary policy, adding fuel to the inflationary fire, long after the economic emergency had passed.”

The Fed has begun reducing its monthly bond purchases at a pace that would end those purchases in June. However, Powell testified that Fed officials will discuss tapering more quickly when it next meets in mid-December.

“It is therefore appropriate, in my view, to consider wrapping up the taper of our asset purchases … perhaps a few months sooner,” Powell said. “We understand that high inflation imposes significant burdens, especially on those less able to meet the higher costs of essentials like food, housing, and transportation.”

Annie Andersen: THE CLOCK TO DECEMBER 3 IS TICKING… THAT’S WHEN THE TEMPORARY SUSPENSION OF THE DEBT CEILING ENDS. 

TESTIFYING BEFORE THE SENATE BANKING COMMITTEE TREASURY SECRETARY JANET YELLEN 

REITERATED THE IMPORTANCE OF CONGRESS DEALING WITH THE DEBT CEILING. 

Janet Yellen: ”I cannot overstate how critical it is that Congress address this issue. America must pay its bills on time and in full. If we do not, we will eviscerate our current recovery.”

Annie Andersen: CONGRESS PUT THE ISSUE ON HOLD IN OCTOBER. 

NOW IT’S BACK ON THE TABLE  AND CONGRESS ISN’T ANYWHERE NEAR AN AGREEMENT ON HOW TO PROCEED. 

MAJORITY LEADER CHUCK SCHUMER HAS SAID HE WANTS A BIPARTISAN AGREEMENT.

Sen. Chuck Schumer: “We must pass the debt debt limit we cannot let the full faith and security of his full faith and credit of this country uh a lapse and we hope to do it in a bipartisan way.”

Annie Andersen: HOWEVER REPUBLICANS WANT DEMOCRATS TO DO IT ON THEIR OWN THROUGH RECONCILIATION… 

SENATOR LINDSEY GRAHAM TWEETING: “IT’S IMPERATIVE THAT SENATE REPUBLICANS DO NOT AID AND ABET THE RAISING OF THE DEBT CEILING”

YELLEN HAS GIVEN DECEMBER 15 AS THE DAY WHEN THE COUNTRY COULD RUN OUT OF MONEY TO PAY ITS BILLS. 

WANT TO KNOW MORE ABOUT THE DEBT CEILING?

CHECK OUT MY PIECE ON IT, JUST HEAD TO OUR WEBSITE AND SEARCH FOR AMERICA? A DEADBEAT. 

STRAIGHT FROM DC, I’M ANNIE ANDERSEN

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Federal Reserve Chair Jerome Powell said the Fed will consider acting more quickly to counter rising inflation and Treasury Secretary Janet Yellen reiterated the importance of Congress dealing with the debt ceiling. Their comments came as they testified in front of the Senate Banking Committee Tuesday.

The committee hearing came just days before the temporary suspension of the debt ceiling ends. Last month, Congress passed a bill that allows the government to continue paying its debts through Dec. 3. Votes on the matter came following a long standoff in the Senate over the debt ceiling.

“I cannot overstate how critical it is that Congress address this issue. America must pay its bills on time and in full,” Yellen said in her prepared testimony. “If we do not, we will eviscerate our current recovery.”

Last Month, Yellen warned that without a hike in the debt ceiling, the U.S. government could default on its debt obligations for the first time soon after Dec. 15.

“In a matter of days, the majority of Americans would suffer financial pain as critical payments, like Social Security checks and military paychecks, would not reach their bank accounts, and that would likely be followed by a deep recession,” Yellen said.

As Yellen discussed the debt ceiling, Powell was grilled by Senate Republicans on inflation, which Powell said himself, “will linger well into next year” in his prepared remarks.

“I’ve been warning about the risks of higher and more persistent inflation since January,” Sen. Pat Toomey (R-PA) said in his opening statement. “Unfortunately, the Fed has decided to continue its emergency monetary policy, adding fuel to the inflationary fire, long after the economic emergency had passed.”

The Fed has begun reducing its monthly bond purchases at a pace that would end those purchases in June. However, Powell testified that Fed officials will discuss tapering more quickly when it next meets in mid-December.

“It is therefore appropriate, in my view, to consider wrapping up the taper of our asset purchases … perhaps a few months sooner,” Powell said. “We understand that high inflation imposes significant burdens, especially on those less able to meet the higher costs of essentials like food, housing, and transportation.”

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