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BCHS students find success in Fed Challenge

Filed in BCHS, District by on June 6, 2017

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The next time Federal Reserve Chair Janet Yellen has to make a decision on interest rates, she may want to check in first with the five Bethlehem seniors who were semifinalists in this year’s New York Fed Challenge. 

They are Corbin BalsanBowen ChenMcKenzie KochJaskiran Dhinsa, and Richard Sweeney who, working as a team and with advisor Jason Majewski, defended months of research and economic analyses in support of recommendations they were making on whether the nation’s central bank should raise or lower the target federal funds rate, or leave it unchanged.

In doing so, the team advanced to the semifinals of the competition, held annually in lower Manhattan, to help students better understand monetary policy and bring real-world economics into the classroom. And though the BC team stopped short of reaching the finals of the 2017 New York Fed Challenge, these students did something some of the other teams could not: accurately predict how the Fed would act on interest rates. Twice.

“We studied a variety of economic data including GDP, unemployment, inflation, markets and other externalities to propose a recommended action for the Fed to take on,” said senior Corbin Balzan, who looks to continue his study of economics at Emory University.

The first round of competition took place March 13, at which time the BC team, with reams of data in hand, argued that the Fed should consider raising rates. On March 15, the Fed did just that.

The BC team’s performance in March, which included a 12-minute presentation on the economy and a 13-minute Q&A with judges who were also analysts and other employees of the Federal Reserve, helped them advance to the next round of competition in April. Meeting regularly to prepare and analyzing new economic data, the group returned to the competition on April 20 to do it all over again and issued another recommendation: Hold the line on interest rates. On May 3, the Fed announced it would not raise or lower interest rates.

“I guess the judges did not agree with our recommendation at the time but it turns out the policymakers did,” said senior Richard Sweeney, who will attend Harvard in the fall. “That feels pretty good.”

The Bethlehem team finished in the top eight of more than 50 teams competing and were the only team from upstate New York to reach the semifinal round.

Teamwork and hard work

Mr. Majewski, who teaches economics at the high school, said the team began their work on the Fed Challenge last October and all the work was done outside of class.

“The Fed Challenge participants develop an ability to think analytically, make powerful presentations, and think on their feet,” said Majewski. “This group had these abilities to begin with and just got stronger as they went along.”

Senior Bowen Chen, who will enroll at Brown University, said the group analyzed a lot of data going back to the housing bubble in 2008 and looking forward.

“Each one of us focused on a particular research topic but I think what helped us the most was that we had great teammate skills,” said Chen. “Working together helped us build a really strong argument for our position.”

Mr. Majewski said the teamwork was particularly important when the group earned a spot in the second round of competition.

“Between the two presentations, they had to adjust their outlook and policy suggestions based on new economic data,” said Majewski. “It was a lot of work and I am extremely proud of what they accomplished.”

Jaskiran Dhinsa, who will attend Cornell University, said she had known a little about the Fed Challenge from her brother, who was a team member last year, but that competing as part of this year’s team had helped her learn about economics, monetary policy and more.

“I did not have a background in economics before I started, but now I realize how economics impacts everything,” said Dhinsa. “Also, I plan to go into Public Health Science and that involves policy making. The Fed Challenge gave me a great introduction to that.”

Richard Sweeney echoed Dhinsa’s feelings about the subject matter that became a passion project for the five seniors.

“You can’t escape economics,” said Sweeney.

Happiness as an economic indicator

McKenzie Koch, who will attend UCLA in the fall to study biology, agreed saying, “Economics was kind of a fearful word to me.” 

“It’s not anymore,” she said, and to prove it, dropped an economics term into the conversation to describe how much she enjoyed being a part of this year’s Fed Challenge team.

“I got a lot of ‘utils’ hanging out with this group,” said Koch, as she and her teammates smiled and laughed.

In economics, utils (pronounced like yodels, but with a “u”) is a term used to describe units of happiness, or the personal benefits a course of action provides.

It turns out the students were not the only ones who racked up utils with their senior year Fed Challenge experience.

“This group had the right combination of work ethic, social skills and great personalities and I just enjoyed working with them,” said Mr. Majewski. “I have had strong students overall but this year’s senior class is special. I just love coming to school.”