Dallas Fed's Kaplan: medium term picture is a challenge

The head of the Dallas Fed, Roger Kaplan, spoke over the weekend at the Hoover Institution Conference in Stanford.

Key highlights

The US economy is very positive and we're making good progress to meeting our objectives. 

He adds the medium-term picture for me is much more challenging.  He cites sluggish workforce growth and tepid growth and productivity. 

The path of debt to GDP "we think has reached unsustainable levels". 

He feels that "this at a minimum will squeeze out the ability of fiscal policy in the next downturn" and "create headwinds for the next recovery". 

While the trade and immigration may have been threats the economy years ago, today they may be opportunities. 

Low natural interest rate which neither spurs nor slows down the economy, means the path of rate hikes is likely to be much flatter than we are accustomed to. 

Pricing power of businesses is challenging.