Fed President: “A Stock Market Correction Could Actually Be A Healthy Thing”

Much of this morning’s interview between CNBC’s Steve Liesman and Dallas Fed’s Robert Kaplan was pre-scripted and uneventful, representing the latest canned discussion of the Fed’s rate hike and normalization plans. Specifically, the former Goldman partner and current Dallas Fed preident once again laid out a noted course for a fairly aggressive path of rate hikes coupled with reductions in the central bank’s balance sheet for the remainder of the year.
Still, there were two notable highlights.
First, Kaplan doesn’t think that’s because the economy is about to take off. Instead, the regional Fed president sees growth likely continuing on the path of about 2% and not the 3% or higher GDP boom forecast in President Donald Trump’s budget.
“Two things drive GDP: growth in the labor force and growth in productivity,” he said. ”

This post was published at Zero Hedge on May 30, 2017.