Cook also addressed questions on climate change, artificial intelligence (AI), and their implications on monetary policy. She acknowledged the financial stability implications of extreme weather events and the potential of AI to exacerbate societal biases. While she clarified that the Fed doesn't make climate policy or have the tools to address inequality related to AI, she noted its role in ensuring fair lending and mitigating the impact of these issues where possible.
Key takeaways:
- Federal Reserve Gov. Lisa Cook stated that the central bank is closely monitoring the stock market, particularly the 'magnificent seven' stocks, for potential financial stability risks.
- Cook emphasized the Fed's dual mandate of price stability and maximum employment, as well as its responsibility for the safety and soundness of the banking system.
- She acknowledged the potential financial stability implications of climate change, but stated that more research is needed to determine how the Fed should incorporate this into its policies.
- Cook also discussed the impact of artificial intelligence on the labor market and economy, suggesting that some restrictions on the technology could be appropriate and that the Fed has a role to play in mitigating potential biases exacerbated by AI.