BUFFALO, N.Y. — Friday marked was another down day on Wall Street as investors fear that the latest report of strong hiring by employers could cause the Federal Reserve to raise interest rates more aggressively to cool down the economy and inflation.
They worry that, in turn, could trigger a recession for the economy.
So with all that, New York Federal Reserve Bank President John Williams was in Buffalo, and 2 On Your Side was there to hear him speak.
Buffalo State economics professor Fred Floss spoke of his significant role, along with his staff, in monitoring and helping to stabilize Wall Street behavior with the Fed's ability to use up to $8 trillion in securities, which could be put into or pulled out of the market at times.
"His job really is to oversee the stock market in New York City and to make sure that markets are moving appropriately, and that their policies are carried out," Floss said. "So he's probably the most important of the regional (Federal Reserve Bank) presidents."
Williams was actually here in the Buffalo area for the past two days to get an assessment of our Western New York regional economy by meeting with local business and government leaders. We basically got a thumbs up.
Taking center stage before students at Buffalo State on Friday morning, Williams spoke about the difficult battle against inflation. He is one of those who hopes that a policy of higher interest rates and other strategies will work just enough to cool off spending and ease inflation, and those higher prices we're seeing for just about everything.
It's a delicate balancing act to also not be too aggressive with interest rate hikes, which could cause the economy to stall out, so this is his prediction of success as a leading economist.
"I do see us on the right trajectory of the economy slowing somewhat, at the same time, bringing inflation down over the next couple of years," Williams said. "Right now the focus is really about getting inflation back down to 2 percent, and doing that in a way that hopefully keeps the economy growing as best as we can."
Williams added this international point on inflation.
"We're seeing really a global high inflation, different than the 60s, 70s or 80s. And we're all working on our own to make the decisions to bring the economy back in balance between supply and demand," Williams said.
"We're all working to figure out how to bring inflation down. But is an extraordinary kind of thing to see almost all the central banks in the world like the Fed raising interest rates, raising them very quickly."
But even with that national economic responsibility, Williams was primarily again for a survey of the regional economy. He noted how local leaders and companies have gone beyond our traditional manufacturing base and tried to develop a strong stable workforce.
"There's been a lot of effort over the previous decades to diversify into medicine and medical fields and education Into other types of manufacturing and services," Williams told the students.
"The importance of investment in K-through-12 education, early childhood education, college and graduate education, job training in the trades, and I think those are investments that are happening, are actually crucial to have."
Also on our border community status, Williams remarked: "The international trade issue has been so challenging in the last couple of years. Basically, policies on both sides of the border, but especially on Canada's, restricting the movement of people. That's been a strength for this region, and as we get more and more people, hopefully tourists coming back and forth."
Buffalo State economics professor Fred Floss spoke with Williams as he moderated the session with students.
"He thinks that Buffalo is coming out of the pandemic and that we have a lot to look forward for," Floss said, "so that's a really important thing from somebody outside the area. I was happy to hear that."