12 The employment rebound suggests that strong measures – such as those the Fed took during and after the crisis – can prevent even sharp job losses from becoming permanent. But the productivity slowdown suggests that monetary policy cannot, by itself, avert all of the damage. This consideration raises the question I mentioned a moment ago.
Particularly notable is the run-up in stock market wealth, the full effects of which apparently have not been reflected in overall demand, but might yet be. Monetary policymakers, balancing these various forces, forecast a continuation of less rapid growth in coming quarters. For 1997 as a whole, the central tendency of their forecasts has real GDP growing 3 to 3¼ percent.