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March 19, 2014

In December 2012, the Federal Reserve announced the advent of the Evans Rule — that the Fed will keep the federal funds rate low either until unemployment falls below 6.5 percent, or inflation rises above 2.5 percent.

Today, Fed Chair Janet Yellen and the rest of the Federal Open Market Committee ditched that rule, announcing that the central bank will continue to keep rates low, even though unemployment is now at 6.7 percent, just 0.2 percentage points away from the target.

That's a great idea. Why? The Evans Rule was never really fit for the purpose; 6.5 percent is a totally arbitrary level. The Fed's mandate calls for "maximum employment and 2 percent inflation." The current employment rate is not — as I have argued — "maximum employment." The natural rate of unemployment is variable, and with growth still relatively weak, there is considerable room for more jobs growth. And with inflation remaining almost a full percentage point below the 2 percent target, there really is no need to tighten right now. More stimulus — and lower unemployment — is merited.

The other decision Yellen announced today — reducing the quantitative easing bond-buying programs by another $10 billion to $50 billion per month — was entirely to be expected given February's strong employment growth. Tapering is a gradual process. If unemployment fails to fall further, further tapering can be delayed or reversed. Or, if inflation picks up, tapering can be accelerated.

All in all, a good start for Janet Yellen. John Aziz

6:18 a.m. ET
Brendan Smialowski/AFP/Getty Images

A series of opinion polls in the past week have shown President Trump's approval rating ending its summer slide and edging up a few points, following his handling of Hurricanes Harvey and Irma and his nods toward bipartisanship. In Gallup's weekly tracking poll, Trump is up to 38 percent approval, from a low of 35 percent in late August, following his comments on the white supremacist violence in Charlottesville. A new Politico/Morning Consult poll has Trump at 43 percent, after hitting 39 percent last month, and a Marist poll from last week clocked Trump at 39 percent approval, from 35 percent in August.

Different polls have Trump recovering among Republicans and/or independents, but staying essentially unchanged among Democrats. His decision to end the Deferred Action for Childhood Arrivals (DACA) program polls poorly, but he got good marks for his handling of recent natural disaster. Trump's RealClearPolitics average is 40 percent, up 2.5 points from last month. All those numbers are historically low for a first-term president. Peter Weber

5:29 a.m. ET

Stephen Colbert began his interview with Hillary Clinton on Tuesday's Late Show with the title of the book she is out promoting: "What happened?" Clinton said it was painful trying to figure that out, but she thought it a worthwhile endeavor so that what happened in the 2016 election "doesn't happen again." She said she was as candid as she could be about the mistakes she made, but also dove into misogyny, voter suppression, the "unusual behavior" of former FBI Director James Comey, and the Russians. "I believe so strongly that they think they succeeded in messing with our democracy," Clinton said, and she thinks they did, too.

Russian President Vladimir Putin didn't just want Donald Trump to win, she said, he wanted to destabilize and undermine American democracy, divide the country, and wreck its faith in its intuitions. "I think that they believe they had a good outing in 2016," she said, "and I think they will be back in 2018 and 2020 unless we stop them." Clinton said she's been told Putin also had a personal grudge against her, but she doesn't take it personally, then she gave a brief psychoanalysis of Putin's anger issues, insecurities, and problems with women.

The fact that she was a female secretary of state and potential president did "seem to get him a bit agitated," she said, and he showed his discomfort with "manspreading" every time they met. She did find one topic that warmed him up, however.

Colbert broke out the chardonnay for the second part of the interview. But first, Clinton tried to clear up some comments she made about the legitimacy of the election. "Nobody's talking about contesting the election, including me," she said, suggesting that if the various investigations find evidence of Trump's team colluding with Russia, people who don't appreciate that mobilize and vote, because the ballot box "is where we settle our political differences, and that's where it should be." You can watch what she felt Trump should have said at the U.N. instead of the "very dark, dangerous" speech he gave below. Peter Weber

4:29 a.m. ET

President Trump is "on a trip to a very hostile region: New York City," Stephen Colbert said on Tuesday's Late Show. He's in New York for the United Nations General Assembly, and on Tuesday, he gave his first big speech to the U.N. "Of course, the U.N. was founded after World War II in hopes of creating a lasting peace, so naturally the highlight of the president's speech was threatening thermonuclear war," Colbert said. And while threatening to annihilate North Korea, "Trump doubled down on his new nickname for Kim Jong Un," Colbert said, puzzled. "Rocket Man? Mr. President, please don't give our enemies nicknames that make them sound cooler. 'I will destroy Commander Jetpack, and Adm. Ice Cream Sex Machine.'"

Trump also griped that America wasn't getting its money's worth with the U.N., and Colbert agreed. "He's right, we're paying top dollar and we're nowhere near world peace," he said. "I mean, I just saw some guy at the podium say he's going to destroy North Korea."

Kim Jong Un didn't immediately respond to his new nickname and the public threat to wipe him out, but The Late Show imagined him hitting back at Trump with an Elton John parody record that would actually be pretty amusing, if real.

Colbert also caught up on Special Counsel Robert Mueller's investigation into Russian election meddling and the Trump campaign. He had a lot of fun with his own nicknames for Trump lawyer Ty Cobb, who blabbed about internal Trump lawyers fighting at a steakhouse, next to a New York Times reporter. Colbert ran down all the news about Paul Manafort, and said that while Mueller's investigation is reportedly moving with unusual speed, "we don't need unusual speed, we need high speed, we need maximum warp ... I'm talking Law & Order speed." And if you're not familiar with the pace of justice on the long-running cop drama, Colbert has you covered. Watch below. Peter Weber

3:46 a.m. ET

Trevor Noah said that if you're excited about the United Nations General Assembly this week, you either don't live in New York City or you really like delayed-gratification "diplomatic shade"-throwing. But Tuesday's big event, he said on Tuesday's Daily Show, was President Trump's inaugural address to the U.N. body, "and expectations were high." The White House promised a "deeply philosophical" speech, but Trump was just Trump. Noah summed up the "Trump Doctrine": "The only way to grow together is to grow apart — It sounds like Donald Trump is trying to break up with the U.N. without getting into a fight."

Noah did find something to like, however, at least on its face. "From a global perspective, it is refreshing to see an American leader who's not going to dictate to the world," he said. But that's only true for Trump "unless he doesn't like how other countries are run." That list includes Venezuela, Cuba, Iran, Syria, and "ever the showman, he saved the end of the world for last," Noah said, playing Trump's threat to North Korea. "I don't know what's more insane: the fact that Donald Trump just stood in front of the United Nations and threatened to wipe out a country of 25 million people, or the fact that he followed that up with 'Rocket Man,'" a "little catch-phrase joke."

"Honestly, when you watched this address, it felt less like a presidential address to the U.N. and more like an insult comic roasting the world," he said. And with a little music and change of scenery, it almost worked. (The annihilation threat still bombed.)

On Tuesday's Late Night, Seth Meyers was puzzled by Trump's nickname for Kim Jong Un, too, but not because it insults a leader with nukes. "Why are you calling him 'Rocket Man'?" he asked. "That's not a diss, that's a cool nickname. You're making him sound like a character from Top Gun." The graphics are pretty eye-catching. Meyers also discussed the Russia investigation and GOP health-care bill, and you can watch below. Peter Weber

2:47 a.m. ET

Tuesday's magnitude 7.1 earthquake in Mexico has killed at least 248 people, Mexican civil defense chief Luis Felipe Puente said early Wednesday, including at least 117 people in Mexico City, where the mayor said buildings collapsed in 44 locations. The earthquake's epicenter was about 76 miles southeast of the capital, near Raboso in Puebla state, the U.S. Geological Survey says, and Puente put Puebla's death toll at 43, plus 72 in Morelos state, 12 in the area outside central Mexico City, 3 in Guerrero and 1 in Oaxaca. Mexican President Enrique Peña Nieto said at least 22 people, including 20 children, have been found dead in a collapsed school in Mexico City, and 30 children and eight adults are still missing.

Peña Nieto said late Tuesday that rescue efforts are ongoing and the main focus for the government, but that 40 percent of Mexico City and 60 percent of Morelos have no electricity. The 7.1 temblor struck 11 days after a massive magnitude 8.1 quake hit off the coast of Mexico, killing at least 98 people, and exactly 32 years after a terrible earthquake struck Mexico City, killing thousands. You can see footage of some of the damage, swaying buildings, and shattering windows in the CNN report below.

And for an eyewitness account, Richard Justin Permenter spoke with The Associated Press from Puebla on Tuesday. Peter Weber

2:05 a.m. ET
Chip Somodevilla/Getty Images

On Tuesday evening, Sen. Lamar Alexander (R-Tenn.), the chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee, said that he was ending bipartisan negotiations for a bill to stabilize health insurance markets and make a few changes to the Affordable Care Act, because after four hearings and involved negotiations, his group had "not found the necessary consensus among Republicans and Democrats." The unexpected decision appears aimed at shoring up support for the Senate GOP's last-ditch plan to repeal ObamaCare, sponsored by Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.), by removing any alternative legislation.

Sen. Patty Murray (D-Wash.), the top Democrat on the HELP Committee and Alexander's main negotiating partner, said she is "disappointed that Republican leaders have decided to freeze this bipartisan approach and are trying to jam through a partisan TrumpCare bill," adding that she is still committed to reaching a bipartisan deal. Alexander said that especially since Graham-Cassidy gained steam, appetite within his party for his bill was very low. "I know how to get bipartisan results, but I'm not a magician," he said.

Republicans expect to start voting on Graham-Cassidy next Wednesday, Axios reports, before a Sept. 30 deadline for passing a health-care bill with only 50 votes, with no Democrats. The Congressional Budget Office won't have its analysis on how much the bill would affect coverage or its costs for consumers until October. On Tuesday, a group of 11 governors, including five Republicans and independent Gov. Bill Walker (Alaska), urged the Senate to drop Graham-Cassidy, joining AARP, the American Medical Association, the American Hospital Association, and other patient advocacy groups, plus Jimmy Kimmel.

Sens. Susan Collins (R-Maine) and Rand Paul (R-Ky.) are believed to be opposed to the bill, and Sens. Lisa Murkowski (R-Alaska) and John McCain (R-Ariz.) are seen as the key votes on the measure — three GOP no votes, and it doesn't pass. Haley Bird at the Independent Journal Review notes:

Graham-Cassidy would convert ObamaCare's subsidies and Medicaid payments to block grants to states, allowing each state ample leeway to decide coverage rules and patient protections, plus cut Medicaid sharply and change its structure. Graham argues that it's the last barrier to "socialism." Peter Weber

1:02 a.m. ET

Hillary Clinton was on Stephen Colbert's Late Show on Tuesday, and before the interview ended, he presented her with a gift. Colbert explained that he did a live show on Election Night, and as it became clear that President Trump would win, the audience looked like it was at a funeral. "One of the things I regret least about that night, but I do regret, is that we had a whole packet of unused Clinton victory jokes," he said. There was "a really, really nice video shot by Katy Perry — now that the femitariat was taking over, how men would be regulated to subservient positions," he explained. Colbert didn't tell any of the jokes, but he did show Clinton — and, eventually the audience — a slightly blurred (for the audience) photo of naked men who were ready to come out on Election Night with a message for the nation. You can catch a glimpse of the photo, and Clinton's reaction, below. Peter Weber

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