Each semsester, my intermediate macro class does an FOMC simulation. Today was the day. The have been researching current economic conditions, the speeches by Fed officials, and so forth. At the end, I polled the class on what action the Fed should take. Of my students, 13 voted to hold interest rates steady. 2 voted to raise, and 2 voted to lower the funds rate.
This is, of course, a completely unscientific poll, but they learned a lot from it. It is the first time in all the semesters that I have assigned this project that there were people favoring three different possibilities.
Perhaps you should ask what they should do six months from now. Looking in the rear view mirror is too easy.
Point taken. However, the purpose of the exercise is to put them in the role of the FOMC for a meeting--much like the Fed Challenge competitions that I have mentioned on this blog before. The idea is to get them into the data of the moment and understand what the Fed is going to do now. The culmination of the exercise is a vote on a policy directive just like the FOMC will do next week. You and I may think it's a foregone conclusion, but the average college student (even an econ major) has not been following this for years like you and I have. This is how we get them started following it.
That said, the students do end up being fairly savvy about what might be down the road. It's hard to avoid the question. But there is no consensus, just a lot of uncertainty--which mirrors reality outside the classroom, does it not?
Further consensus arrives when one looks at the 30+ high schools that participated over the past few weeks in the High School Fed Challenge in the Chicago Federal Reserve District.
All of them voted to hold steady, although there were dissenting votes in many presentations. Again the dissents seemed evenly split between a hike and cut.