A Guide to Today’s Economic Agenda

Today is a busy day for economic wonks and other economist-types in Washington. Below is a brief guide to all the action:

• At 9 a.m., the Federal Open Markets Committee — the board on the Federal Reserve that sets interest rates — starts a two-day meeting in Washington. The FOMC is expected to announce tomorrow afternoon they are holding rates near zero for an “extended period”, though more hawkish members (economists who believe that the risk of inflation means the FOMC should raise rates) may dissent. For the past two meetings, Kansas City Federal Reserve President Thomas Hoenig, a voting member of the committee, has argued against his more dovish colleagues and said the Fed should stop signaling that it will not raise rates anytime soon (axing the “extended period” language). Any suggestion that the Fed might tighten monetary policy in the second half of the year will be news-making and rate-changing.
• At 10 a.m., the Senate Permanent Subcommittee on Investigations, headed by Sen. Carl Levin (D-Mich.), meets and hears testimony from Goldman Sachs employees regarding the company’s role in the financial crisis. Planning to testify are chief executive Lloyd Blankfein, chief financial officer David Viniar, and London-based trader Fabrice Tourre, charged in the Securities and Exchange Commission’s civil fraud suit against Goldman. Expect fireworks from Levin, and a conciliatory tone from Blankfein.
• Also at 10 a.m., the bipartisan Presidential Budget Commission meets for the first time and will hear testimony from Federal Reserve Chairman Ben Bernanke. Last weekend, former Sen. Alan Simpson (R-Wyo.), called the debt commission a “suicide mission”; economists believe there is no way for the United States to balance its budget without raising taxes, and Republicans have not supported a tax increase in more than 20 years. “Americans are right to be concerned that this commission is merely a front to provide Democrats with the political cover they need to impose massive tax hikes,” House Minority Leader John Boehner (Ohio) recently argued.