Although we work through financial markets, our goal is to help Main Street, not Wall Street.
Janet YellenRead
Firms don't just try to pay as little as possible to get the needed bodies on board; when there is unemployment, they ask themselves how wage cuts would affect the behavior of the employees. Would they quit or feel dissatisfied and work less hard on the firm's behalf if they feel that wage policies are unfair?
Interpretation
Companies consider the impact of wage cuts on employee morale and productivity, rather than solely focusing on cost reduction.
In this quote, Janet Yellen highlights the importance of understanding employee behavior in relation to wage policies. While firms may aim to minimize costs by implementing wage cuts, they must also consider the potential negative consequences such actions could have on employee satisfaction and productivity, as disgruntled workers may become less motivated or even leave the company altogether.
In practice
In a business seminar discussing the importance of fair wages.
Although we work through financial markets, our goal is to help Main Street, not Wall Street.
We need to keep in mind the well-established fact that the full effects of monetary policy are felt only after long lags. This means that policy makers cannot wait until they have achieved their objectives to begin adjusting policy.
A clear lesson of history is that a 'sine qua non' for sustained economic recovery following a financial crisis is a thoroughgoing repair of the financial system.
Transparency concerning the Federal Reserve's conduct of monetary policy is desirable because better public understanding enhances the effectiveness of policy. More important, however, is that transparent communications reflect the Federal Reserve's commitment to accountability within our democratic system of government.
For decades, the pace of technological change in manufacturing has outstripped that in the economy as a whole. And, so, firms - manufacturing firms - have found it easier to continue producing by - with - reducing their workforces.
Inequality has risen to the point that it seems to me worthwhile for the U.S. to seriously consider taking the risk of making our economy more rewarding for more of the people.
This is the paradox of thrift: belt-tightening causes people to lose their jobs, because other people are not buying what they produce, so their debt burden rises rather than falls.
Printing money is merely taxation in another form. Rather than robbing citizens of their money, government robs their money of its purchasing power.
I will not let anyone tell me we must spend more money. This crisis did not come about because we issued too little money but because we created economic growth with too much money and it was not sustainable growth.
In order to deal with all the medical cost demands and other challenges in the U.S., as we look to raise that revenue, the rich will have to pay slightly more. That's quite clear.
Before the 1970s, banks were banks. They did what banks were supposed to do in a state capitalist economy: they took unused funds from your bank account, for example, and transferred them to some potentially useful purpose like helping a family buy a home or send a kid to college.
Let us never forget this fundamental truth: the State has no source of money other than money which people earn themselves. If the State wishes to spend more it can do so only by borrowing your savings or by taxing you more. It is no good thinking that someone else will pay - that 'someone else' is you. There is no such thing as public money; there is only taxpayers' money.
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