“Retirement” doesn’t mean no work for Esther George. It also doesn’t mean a time to rip her former colleagues for not acting sooner like some politicians have done. Federal policymakers got this right, she believes.
“That was a pretty bold step to begin a rate-cutting cycle,” George -- the former president of the Federal Reserve Bank of Kansas City from 2011 to 2023 -- said of the Federal Open Market Committee’s decision to lower the federal funds rate by 50 basis points during its September meeting.
Esther George Bio
Federal Reserve Bank of Kansas City – various leadership roles in public affairs, human resources, risk management. President and Chief Executive for 12 years.
Federal Open Market Committee – former member
Harry S Truman Public Service Award Recipient
Ewing Marion Kauffman Foundation – Board Chair
Hallmark Cards – Corporate Director
Esther George Consulting – Founder
Treasurer, FIFA World Cup KC 2026 (Kansas City will host World Cup soccer in 2026.)
Washington Speakers Bureau – traveling speaker
Last December, George told American Farmland Owner that she had doubts about whether the Fed could navigate the “soft landing” that could slow down the economy without crashing the country into financial recession.
But George thinks that the Fed managed a potential economic crisis – triggered by this unprecedented global COVID-19 pandemic – about as well as possible. The economy in the United States, despite any talk about gloom and doom political fearmongering, is strong, George said.
Inflation continues its descent toward the Fed’s goal of 2% with unemployment slightly above 4%. Wage increases top price increases for many people, especially over the past one or two years.
And the stock market has been soaring for much of 2024 with record high after record high.
Investors have done especially well overall. And since more than six in ten American adults own stocks in some form -- individual stocks, mutual funds, 401 (k), or IRA – that means that many people may be doing better financially than their sticker-shocked psyche may realize.
“By and large, I think people are happy to have jobs. People are okay with where they are generally, depending on where you sit in the income strata of work,” George explained.
“If you’re in the lower income, you’re pretty stressed right now. And you are trying to make ends meet,” she said of the eternal struggle for families with limited financial means, regardless of current time period.
“Other people (those in the middle and higher income levels)…continuing to spend quite heavily, which is buoying our economy overall,” George said.
She expects the FOMC will make additional reductions when it meets in November and December. It could be reductions of 25 basis points during each meeting.
RELATED: Should you hold onto your cash instead of investing it someplace as you wonder what will happen in the November 5th election? History would indicate that might not be your best financial move, according to this CBS MarketWatch article.
George, as she does when she travels the country speaking to groups as part of the high-profile Washington Speakers Bureau, warned that federal officials are on a financially unstainable path – irrespective of actions that the Fed takes – when they refuse to act with a long-term mindset.
They focus too much on proposing what sounds good in the short-term to voters (tax cuts without spending reductions, increased spending on various programs and initiatives without spending cuts or revenue increases elsewhere, and refusal to make changes to Social Security and Medicare programs).
“People are worried about the federal government,” she said, “…how much it spends and its revenues, and whether we can sustain that in the long run.”
“I think the easy answer to that is, ‘no.’ We can’t sustain that. And something has to be done,” George said.
“People are looking for…what is the answer to that? How do we solve for what is a long-term issue for our country?”
RELATED: If you want to see the ever-worsening visual of the failure of federal elected officials to address responsible financial management of your tax dollars, check out this U.S. Debt Clock as it climbs toward $36,000,000,000,000.
