ByWillAtkinson.com

Richmond Federal Reserve Bank president Jeffrey Lacker (left) met with students before the speech. Winthrop president Anthony DiGiorgio (right) attended the lecture.

Five days prior to Pres. Bush’s announcement of Ben Bernanke as the incoming Federal Reserve chairman, Richmond Federal Reserve Bank president Jeffrey Lacker advised Winthrop students and faculty on the new Fed leadership.

Lacker said the new administration will not be a “sharp departure” from Alan Greenspan’s policies. With Greenspan’s 19-year tenure, Lacker said the Federal Reserved learned a great deal about the “theory and practice of monetary policy.”

Over 200 students filled the Barnes recital hall Oct. 20 to hear Lacker speak. The speech was part of the ongoing College of Business Administration lecture series.

The crowd reaction was positive.

“The Fed does a great job,” Business professor John Robbins said. “We need them there to help regulate the money supply.”

There are 12 district Federal banks, Richmond being one. The banks implement Federal Reserve policy by controlling the money supply and regulating member banks.
Lacker addressed the effects of Hurricane Katrina.

“Economic growth was strong after Katrina and the areas not affected by the storm seem to be holding up pretty steady,” Lacker said. “The concern in the near term is the extent to which energy prices pass through into the overall price level.”

Lacker also expects activity in the housing market to “drift down” over the next couple of years. He also addressed the relationship between college students and the Federal Reserve.
“The main thing [college students] should know is that we push interest rates around so as to keep interest rates low and steady,” Lacker said.

He said that when interest rates go up, student loans, credit cards and auto loans get more expensive. Students thinking about salaries after graduation need to be aware of interest rates, said Lacker.

The 50-year-old Lacker was named the Richmond Federal Bank president in 2004. He formerly held teaching positions at the College of William and Mary and Purdue.

Lacker declined to comment on the Federal Reserve’s impending update of interest rate policy.

Winthrop president Anthony DiGiorgio serves as director of the Charlotte board of the Richmond bank.