Hi, I'm Dan Premack.

Welcome to a special weekend edition of Axios Recap, tied to an Axios deep dive on the Federal Reserve.

This episode is sponsored by the Northern Trust Institute.

Our goal over the next 15 minutes is to explain what the Fed does and why it matters more than ever.

A few things to know. First, the Fed deals with monetary policy, whereas Congress and the president deal with fiscal policy. Or put another way, the Fed's

decisions are mostly about things like money and credit, whereas elected officials make

laws about taxes and spending. Two, that bright line between

monetary and fiscal policy has been dimming, particularly as the Fed and Treasury Department

have worked together to curtail the pandemic's economic impact. Plus, the Fed, currently led by

Chairman J. Powell, has begun addressing less traditional areas like climate change and racial

inequality. Third, and this is the most important, Fed policy over the past year has been

credited and criticized for the massive run-up in asset values, from stocks to housing to

everything in between. In other words, the Fed is the answer to how could stocks keep going up

if the economy has so many problems. So in 15 seconds, we will dig into all things Fed, its recent

leadership, and how its influence could evolve with Axios business reporters Felix Salmon

and Courtney Brown. But first, this. We're joined now by Axios's Felix Salmon and Courtney Brown.

Felix, let's start with you and the most simple question. What is the Fed designed to do?

The Fed is designed to do two things. It has two mandates. One is to keep prices under control, stop inflation from ravaging the economy.

And number two is to help the economy get to what's known as full employment.

Anyone who wants a job can get a job.

And it doesn't have a massive toolbox to get those two things, but it does

control the money supply, which is pretty big. So it uses that. It uses its ability to set

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