Salisbury University Students Win Fed Reserve Challenge

SALISBURY, MD --A team of five Salisbury University students imparted economic advice to Fed Chairman Alan Greenspan and members of the Federal Open Market Committee (FOMC) last week. The presentation won the sixth annual College Fed Challenge, a competition that involves researching and analyzing data on current and near-term economic conditions to recommend whether to raise, lower or maintain interest rates. The participating teams included 10 universities and colleges from the Federal Reserve District of Richmond.

"Several of these campuses have larger economic departments. I'm very proud of our students' achievements," said Dr. Ying Wu of SU's Department of Economics and Finance and an advisor to the group.

The team consisted of five members: coordinator Zachary Richards of Brandywine, Andrew Doyle of Chevy Chase, Bryan Shone of Gaithersburg, Zelaleme Tamre of Silver Spring and Tyler Wickline of Waldorf, all in Maryland.

In their presentation, they advised that the federal funds rate should remain unchanged for the near future. They stated, "Although we are not currently experiencing deflation, it is looming. The combination of deflation and heavy debt would greatly complicate economic recovery and reduce the effectiveness of monetary policy." They discussed their concerns over a potential war with Iraq and considered the important consequences of changes in consumer confidence, oil prices and the financial markets. After the 20-minute presentation, the students defended their analysis in a 15-minute Q&A session.

Afterward the students said the competition helped them connect what they learned from the classroom with the real world. They feel the Fed Challenge provided an opportunity for them to experience the "fun" and power of economics, a subject that is traditionally dubbed a "dismal science."

The Federal Reserve-sponsored competition, which is in its sixth year, was held November 18-19. Shippensburg University and the United States Naval Academy were selected as finalists. Honorable mention was given to Gettysburg College, Loyola College, McDaniel College, Mount St. Mary's College, St. Mary's College, University of the District of Columbia and the University of Maryland Eastern Shore.

The Baltimore Branch Office of the Federal Reserve Bank of Richmond will hold a formal awards ceremony and luncheon reception in January for the winning students and their families.