President of the Federal Reserve Bank of Richmond, Jeffery M. Lacker, spoke on “How to Know When to Raise Interest Rates” Wednesday afternoon in the Brad D. Smith Foundation Hall.

Lacker’s lecture focused on interest rates, inflation and financial events after the recession in 2008.

“It must seem awfully mysterious to people sometimes,” Lacker said. “There’s always room for further education on [how interest rates work].”

Lacker, a former professor, said he wanted to focus his time on explaining why he favors raising interest rates and how the process works. After a brief introduction and overview, he “jump[ed] into the nuts and bolts.”

“We’ve been thinking since [2008] to raise rates, and that’s why I’m here,” Lacker said.

Foundation Hall was filled with students, faculty and administration. Within the first few minutes of the lecture, every seat in the hall was filled and students stood in the back to listen.

Junior marketing major Jason Sullivan said he enjoyed listening to a professional who has experience in the field.

“It’s important for the students to see how things they have been learning in classes applies to the real world,” Sullivan said. “There were some [ideas] I recognized from my econ class, so I was able to follow along well.”

Lacker emphasized that people’s expectations of the financial future impact the way interest rates and inflation rates rise and fall.

“Money is only what it can buy; you expect you’ll have something of value in the future,” Lacker said. “It depends on the value of money at that time, and expectations are important when money is involved.”

The Federal Reserve president spoke on American history of interest and inflation rates, focusing on the 20th century. He said he wants more research to be done on the current financial times.

“When you guys think of the Grateful Dead and the hippies of the 70’s, I think of a period of [high] inflation,” Lacker said.

In response to a question about the current financial recovery from the recession of 2008, Lacker spoke positively about the process.

“We’re recovering well; it hasn’t been unnaturally slow,” Lacker said.

Brooke Estep can be contacted at [email protected].