The Economic Outlook in a Turbulent Period

It is a pleasure to be with you today, although I have to confess that I am not very alert because I had a nightmare last night. I dreamed that war had just begun in the Middle East. There was substantial uncertainty about short-term prospects for oil supplies and hence oil prices. Consequently, there was more than even the usual, substantial uncertainty about near-term prospects for the economy and financial markets — so much so that the Federal Open Market Committee had simply dropped the so called "bias" sentence from its policy directive at its FOMC meeting the week before. Financial markets were especially volatile. All that was bad enough. What gave me the nightmare, though, was that in the midst of all this uncertainty, I had to make a talk about the economic outlook to students, faculty, and alumni of the Johns Hopkins Graduate Division of Business and Management. Nonetheless, I am happy to have this opportunity to be with you, and I appreciate your invitation.