WASHINGTON (Reuters) - The severe sort of recession that hit the United States in 2007-2009 is not that rare historically, a top Federal Reserve official said on Thursday, suggesting policymakers need to better understand how to operate with interest rates at rock bottom.
San Francisco Fed President John Williams presented a paper on monetary policy at the so-called zero lower bound to kick off a Brookings Institution event, where Fed Chairman Ben Bernanke would later speak.
Williams did not comment on current monetary policy.
Instead he said recent economic events are not rare or unprecedented, as many have characterized them. "History teaches us that very large downturns are not only possible - they are probable," Williams was to say according to prepared remarks.
"When looked at through the lens of the postwar U.S. experience, the depth and duration of the recent recession may appear extraordinary," he said. "However, a broader look at economic history and events around the world teach us that deep and long-lasting downturns are not that rare."
In response to the Great Recession, the Fed has kept interest rates near zero since 2008 and has promised to keep them there for a while to come. It has also bought some $3 trillion in bonds to lower borrowing costs in financial markets.