Former NY Fed President Bill Dudley does not think Fed will move to negative interest rates. If they do it will scare people.

Video Transcript

BILL DUDLEY: There's a FOMC meeting a while ago where they said, they reported that all participants were opposed to moving to negative interest rates, and nobody was even slightly interested in it. I think the assessment of the FOMC, Federal Open Market Committee, is just that the cost of moving to negative interest rates exceeds the benefits.

And I think after showing so much reluctance to even contemplate moving to a negative interest rate, if they were actually to do so, I don't think it'd be reassuring to people. I think we would actually take that as a sign that the outlook was even worse. You know, the last thing you want to do is introduce a new policy that scares people. You want people, when you introduce a new policy, you want people to be more reassured, and I don't think moving to negative interest rates, at this juncture, would be helpful in terms of supporting economic activity.