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Transcript: Austan Goolsbee, president of Federal Reserve Bank of Chicago, on “Face the Nation with Margaret Brennan,” Aug. 18, 2024
The following is a transcript of an interview with Austan Goolsbee, president of Federal Reserve Bank of Chicago, on “Face the Nation with Margaret Brennan” that aired on Aug. 18, 2024.
MARGARET BRENNAN: We go now to Austan Goolsbee, the President and CEO of the Federal Reserve Bank of Chicago. Before taking on that apolitical role he had previously served in the Obama administration. Good morning to you.
AUSTAN GOOLSBEE: Hi. Great to see you again, Margaret.
MARGARET BRENNAN: So, President Goolsbee, Barron’s had a piece yesterday saying that the most consequential event this fall won’t be the U.S. election, it won’t be a war in the Middle East, it will be the Federal Reserve’s decision in September to lower interest rates for the first time in more than four years. Is that a certainty? Do you think it is time to lower rates?
GOOLSBEE: I don’t think it’s a certainty, and I- I don’t like, as you know, tying our hands ahead of time when we got a lot of data to come in and everyone on the committee is going to get to speak their piece, and it’s a- it’s a committee decision. We try, as the Fed, to make clear what our reaction function is, if you want to call it that. I invite everybody to go read the statement of economic projections, which every -in our- in our world, colloquially, we call the dot plot, where we outline every quarter, what do the members of the committee individually think will be the appropriate policy for each of the next three years, and what economic conditions do they expect to correspond with those? And we’ve been making clear for quite a while what economic conditions would be appropriate for us to cut rates, for us to hold rates where they are, and things like that. And I do think that the- we set an interest rate more than a year ago at a high level because we were fighting inflation, and the economic conditions today are very different than they were when we set the rate at this level.
MARGARET BRENNAN: So, interest rates and supply of housing impact what consumers end up paying for shelter. What is going to bring down shelter costs? Because that was such a big part of the inflation number that we just saw.
GOOLSBEE: Well, look, Margaret. You know as much as anybody about this, the biggest puzzle that we’ve seen in the inflation numbers has been the persistently high inflation rate on shelter and housing, and we- we can get a little mixed up, because that official measure is very- is a very lagging indicator of what the actual housing price conditions are on the ground. So our puzzle has been why the market rents inflation rate has come down, but that hasn’t yet been reflected into the official backward looking housing inflation. So one of the things that’s going to bring it down is just- we’re going to keep getting more data, and that’s going to get incorporated into the official series. But the second is, the interest rate, how it works, how the Fed stabilizes the Business Cycle, is when it tightens the screwdriver, the interest rate goes up and the demand for housing goes down and so some of those interest rate sensitive sectors of the economy, weakness in that is partly how the monetary transmission takes place and the inflation rate softens. And it’s worth noting that last year, inflation fell by almost as much as it has ever fallen in a single year in the United States, and that happened without a recession which is unparalleled. So we’re hoping to continue some of that as we go through ’24.
MARGARET BRENNAN: That’s part of the delicate dance the Fed is doing here. Bank of America’s CEO was with us last week on- on “Face the Nation,” and he told us his economists are no longer predicting a recession, but he did say there’s a risk if the Fed does not start to move rates down. Take a listen.
(BEGIN SOUND ON TAPE)
BRIAN MOYNIHAN: They’ve told people rates probably aren’t going to go up, but if they don’t start taking them down relatively soon, you could dispirit the American consumer. Once the American consumer really starts going very negative, then it’s hard to get them back.
(END SOUND ON TAPE)
MARGARET BRENNAN: He also said corporations aren’t using their lines of credit due to the higher rates. What do you make of that caution?
GOOLSBEE: I think it’s a valid caution when rates are this high, if you take measure of how tight the Fed is as just a What’s the rate minus what’s the inflation rate, when you set a rate high like we have, and hold it there while inflation falls, you’re actually tightening. Credit conditions are getting tighter. And when we go out in the Chicago seventh district, you can hear from business leaders and community leaders around the district that credit conditions on them are tight when your bank loans and what the rates they pay and credit availability is tight. So I think he’s right. I think you got to have a caution when you see small business defaults rising like they have been rising. When you see consumer credit delinquencies, credit card delinquencies rising like they’ve been rising, those are warning signs. Now there’s, there’s some others that are more positive, but they’re, they’re definitely of concern. And if you keep too tight for too long, you will have a problem on the employment side of the Fed’s mandate.
MARGARET BRENNAN: So a recession for you? Is it off the table?
GOOLSBEE:
No, look. You’ve seen the table at the FOMC committee –
MARGARET BRENNAN: –I know–
GOOLSBEE: –a huge table–
MARGARET BRENNAN: I know
GOOLSBEE: Everything is always on the table. When there’s possibility of recession. The last GDP growth number was higher than expected. So that was a that was one of the bright spots. But you always got to worry about every contingency. That’s the job of the central banker.
MARGARET BRENNAN:
I want to ask you as well about what’s happening with what people pay at the grocery store. The San Francisco Fed found that corporate markups, what some might call price gouging, are not a primary contributor to inflation. Do your economists agree?
GOOLSBEE:
Well, look this, this has turned into a campaign election kind of battleground. So I’m not–
MARGARET BRENNAN: –I’m not asking a political question–
GOOLSBEE: We’re not in elections business. I’m not going to get into that. I think that it’s worth remembering that there are dynamics at play that is over time, wages tend to move slower than prices. So if some shock hits, prices go up, then wages go up, then prices come down, then wages come down. And so if you look at any given moment, that markup sort of the difference between what’s happening to prices and what’s happening to costs that can vary a lot over the business cycle. So I just caution everybody over concluding from any one observation about markups.
MARGARET BRENNAN: Are tariffs inflationary?
GOOLSBEE:
It sounds funny to say. It depends what you mean by inflationary. Tariffs raise prices, but in terms of something that, inflationary is about the rate of growth of prices, a one time increase in costs will raise prices, but is not an extended inflationary thing. So whether you want to call that inflationary or not, they raise costs and they raise prices.
MARGARET BRENNAN
Austan Goolsbee, we want your perspective as one of the top economists in the country. I know you left politics behind, and I’ve made you a little uncomfortable by asking you some of these questions, but we want to bottom line it.
GOOLSBEE:
You’re the smartest in the business. Margaret, any time you want to talk Fed mandate, inflation or employment, I’m, I’m always, I’m always up for it.
MARGARET BRENNAN
All right. Austan Goolsbee, thank you for your time. We’ll be back in a moment.
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A teenager started hearing a strange pulsing noise, but her mild symptoms were signs of an alarming condition
When Lizzie Clark was 13, she started experiencing a strange ringing in her left ear. At first, she thought the tinnitus-like sound was a side effect from a cold. But the cold left, and the sound lingered, pulsing in time with her heartbeat.
For months, the “strange pulsing noise” was constant, Clark told CBS News. Her parents took her to see her primary care physician, then an ear, nose and throat doctor, but it wasn’t until she underwent a CT scan that doctors finally found the cause. The eighth-grader was racing in a track meet when doctors called her parents and said they had seen a growth behind her eardrum.
“I was terrified. I was 13. I was like, ‘What growth? What does that mean?'” Clark recalled. “There were a lot of questions buzzing around.”
Clark was diagnosed with facial nerve schwannoma, a slow-growing benign tumor. The first doctor she saw recommended immediate surgery to resect the tumor, but told Clark and her parents the operation would damage her hearing and permanently paralyze the left side of her face.
Courtesy Lizzie Clark
Unsatisfied with that option, Clark and her parents sought a second opinion from Dr. Pablo Recinos, a neurosurgeon at the Cleveland Clinic. He advised a more cautious route that would require careful surveillance — but might preserve Clark’s hearing and facial function.
Watching and waiting
Recinos said because facial nerve tumors tend to be slow-growing, it’s possible to wait before operating. Clark was young, and her tumor wasn’t showing signs of growth. He began working with reconstructive surgeon Dr. Patrick Byrne, the chief of Cleveland Clinic’s Integrated Surgical Institute, on a series of complex operations that could treat Clark while minimizing risk.
First, Byrne would do nerve graft surgeries that would connect the nerves on the left side of Clark’s face to those on the right side. This would rewire that side and keep Clark’s face functional, Recinos said. The nerve graft surgeries would be followed by a surgery to remove the tumor. It was a unique approach, and Clark was the first patient that Recinos and Byrne developed the technique on, Recinos said. They have since performed it on several other patients.
For several years, Clark had MRIs taken every six months. During that time, the tinnitus-like continued and a tube was put in Clark’s ear to clear fluid that accumulated and couldn’t drain naturally because of the growth. Otherwise, Clark experienced few symptoms. She even named the tumor, calling it “Teddy” so it was easier to “cope with everything.”
When a photo of herself was taken in her junior year of high school, Clark noticed her smile was crooked and her face was becoming asymmetrical. Shortly afterward, she began to experience mild facial paralysis. That brought Clark and her parents back to the Cleveland Clinic. Recinos and Byrne decided those symptoms meant it was time to start operating.
Courtesy Lizzie Clark
Clark had the first nerve graft surgery in 2021, followed by another operation in early 2022. The procedures led to some improvement in Clark’s facial asymmetry and paralysis, which had become so severe her left eye couldn’t close properly. In December 2023, scans showed that the tumor had grown and was threatening to reach Clark’s brain stem. Delaying the removal surgery was no longer an option.
“Excited for it to be over with”
Despite the years of preparation, there was no guarantee that Clark wouldn’t lose some hearing or facial movement function after the removal surgery. In fact, Clark said she was told she would likely lose hearing on her left side, because of where the operation had to take place, and wake up with a “drastically different” appearance. There were also concerns she’d have trouble speaking as she recovered. It wasn’t that different from the results she had feared when she and her parents saw their first doctor years before. Clark had hoped to wait until she finished college to get the operation, but there was no longer any time to delay. She made arrangements to take off the first semester of 2024 and scheduled the surgery for August.
Courtesy Lizzie Clark
“I wasn’t scared, like I was at the beginning. It was more like a calm relief that the tumor was going to be gone, that there weren’t going to be any more problems,” said Clark. “I was ready for the tumor to come out. I had accepted the fact I was going to use my hearing. I was talking to my parents about potentially doing an ASL class. I knew it was going bg to be an adjustment, but everyone was excited for it to be over with.”
At 5 a.m. on Aug. 8, 2024, Clark arrived at the Cleveland Clinic for the removal surgery. Clark was so scared she hadn’t slept the night before, and her mother cried as her daughter was wheeled into the operating room. They knew the operation was going to be long and arduous, and that Clark’s world would look different when she woke up.
Recinos said that the 22-hour operation went smoothly. Neurotologist Dr. Anh Nguyen-Huynh operated around Clark’s ear and hearing structures to reach the tumor. Once there, Recinos cut Clark’s facial nerve and removed the tumor. Finally, Byrne reconstructed the area where the surgery had taken place. Clark spent another eight hours sleeping off the effects of anesthesia.
When Clark woke up, 30 hours after being wheeled into surgery, the first thing she heard was her parents speaking.
“I’m like ‘That’s strange. I can hear them both out of both my ears,'” Clark recalled. “I told them ‘I can hear you.’ My mom said, ‘Is that the meds talking? Or can she actually hear us?’ I’m like, ‘Yeah, I can hear you guys.’ That was a sense of relief.”
Regaining function and looking forward
While Clark was drowsy and in some pain, she didn’t have any difficulty speaking. Her facial function wasn’t limited, but in fact was improving: A few days after the operation, she noticed the left side of her mouth was curving back up to its natural position and her eyelid was closing better.
Recinos said the nerve grafts before the removal surgery led to the more successful result. The nerve graft had time to regenerate and resettle in her face, he explained, allowing Clark to maintain facial function.
“It was a surprise to everyone that my face was working as well as it was, considering they just cut out my main facial nerve,” said Clark. “My face doesn’t look 100% like it did five years ago, but it’s better than the alternative.”
Courtesy Lizzie Clark
Clark is now waiting to return to classes at the beginning of the spring semester. She’s on a pre-pharmacy school track, inspired by having spent so much time with medical professionals. A pathology report found that Clark didn’t have a schwannoma like she was initially told, but a meningioma. Both types of tumors are slow-growing and can recur, so Clark will have regular follow-ups to make sure there is no new growth, Recinos said.
Clark said that she hasn’t heard the ringing in her ear since waking up from the operation. That left when “Teddy” was removed, she said.
“Going to bed and hearing that whooshing noise, or when it was dead quiet and I could hear it, was really annoying me,” she said. “It’s very nice that it’s gone.”
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Trump expected to attend Saturday’s Army-Navy game alongside key allies, nominees and Daniel Penny
President-elect Donald Trump will huddle with allies and a Republican cause célèbre at Saturday’s Army-Navy football game, a chance to take in one of most stories rivalries in college sports while spotlighting his emerging national security team.
Trump is expected to be joined by Vice President-elect JD Vance, embattled Pentagon pick Pete Hegseth, potential backup defense option Florida Gov. Ron DeSantis and others for the 125th matchup between service academies. Elon Musk is also expected to attend.
Also planning to attend is Daniel Penny, a military veteran who was acquitted of criminally negligent homicide this week in the chokehold death of an agitated subway rider in New York. Penny was invited by Vance, who accused prosecutors of trying to “ruin” Penny’s life by charging the Marine veteran in the death of Jordan Neely in 2023.
Trump, who attended Army-Navy games as president-elect in 2016 and during his first terms, has been making an increasing number of public appearances before his inauguration on Jan. 20, 2025. He was accompanied by his family and Vance on Thursday as he rang the opening bell for the New York Stock Exchange after being recognized as Time magazine’s person of the year.
Trump spent the weeks after the Nov. 5 election holed up at his Mar-a-Lago resort in Florida assembling a team to help lead his next administration. He and his aides have become bullish about Hegseth’s chances of winning Senate confirmation. The Army combat veteran and former Fox News host’s chances of becoming defense secretary had appeared in peril amid allegations of excessive drinking, sexual assault and his views on women in combat.
Peter Kramer/NBC via Getty Images
DeSantis, a former Navy lawyer who competed against Trump for the Republican presidential nomination, is among the possible replacement candidates Trump has considered if Hegseth’s bid fizzles.
Trump senior adviser Jason Miller said Friday in a Newsmax interview that Hegseth has “made it through the gauntlet.” Miller predicted Hegseth will be confirmed.
“This is someone who’s literally been shot at on the battlefield,” Miller added. “That’s the type of person who I want leading the (Department of Defense) because as we make these decisions about whether or not to put American troops into harm’s way, I want someone who knows at a personal level what that’s like before you go and send some young man or young woman into battle.”
House Speaker Mike Johnson, R-La., is also expected to attend the game and bring with him a contingent of other GOP lawmakers vying for face time with the incoming president weeks before Republicans take control of the three branches of the federal government.
Johnson said he intends to discuss with Trump plans for a legislative package that could move through Congress next year with a simple majority in the face of expected Democratic opposition.
Vance said Friday that Penny, a fellow Marine veteran, had accepted his invitation to be in Trump’s suite on the Army side. Penny was cleared of criminally negligent homicide in Neely’s death after a judge had dismissed a more serious manslaughter charge last week because the jury deadlocked on that count.
The case was a flashpoint in the long-standing debates over racial justice and as well as failures by New York City to address homelessness and mental illness, both of which Neely had struggled with.
“Daniel’s a good guy, and New York’s mob district attorney tried to ruin his life for having a backbone,” Vance said in a post on X. “I’m grateful he accepted my invitation and hope he’s able to have fun and appreciate how much his fellow citizens admire his courage.”
Hegseth planned to be in a suite with some Medal of Honor recipients, according to a person familiar with Hegseth’s schedule.
Trump’s picks for Navy secretary, John Phelan, a businessman who never served in the military, and for Army secretary, Dan Driscoll, an Iraq War veteran and former senior adviser to Vance, also are expected to attend, said the person, who was not authorized to publicly discuss those details and spoke on condition of anonymity.
Kickoff is after 3 p.m. EST at Northwest Stadium, home to the NFL’s Washington Commanders, in Landover, Maryland.
Governor Wes Moore proclaimed Dec. 14, 2024, as Army vs. Navy Game Day in Maryland.
“Today is not just about one of the greatest rivalries in college sports – It’s about what brings us together. I am proud to be part of the long tradition of service that defines our state and our country; one that transcends background, ideology, race, and family history,” said Moore.
Army (11-1) is ranked 19th in The Associated Press Top 25 after beating Tulane on Dec. 6 to win the American Athletic Conference — the first league title of any kind in the team’s 134-year history. Navy (8-3) was ranked earlier this season after starting with six straight victories.
The Navy Midshipmen and the Army Black Knights have faced each other on the football field every year since 1930, including when the United States was fighting in World War II.
Winslow Townson / AP
Army will pay tributes to soldiers who fought in a pivotal battle 80 years ago that occurred as Adolf Hitler launched a last-ditch effort to push back American and Allied forces in Europe. The Army’s 101st Airborne was among the units that fought Axis troops amid freezing weather.
Now, Army’s Black Knights are hoping to honor that dogged determination on the field today. Their uniforms on the field are inspired by the snow and trees the soldiers were surrounded by, and reflect the tenacity of the soldiers, who refused to surrender and were able to fight off the enemy.
