There seem to be some misconceptions about the monetary consequences of actions that the Federal Reserve has taken to address liquidity needs.
Author Archives: James_Hamilton
Forward rates and inflation expectations
Forward rates on Treasury bonds tell an interesting story about the market’s reaction to the Fed’s interest rate cut on Tuesday.
50 it is
For the first time in 5 years, markets were actually unsure what the Fed was going to do, with yesterday’s fed funds options calling it an even chance that the Fed would settle for a 25-basis-point cut or go all the way to 50. Capital Chronicle had prepared amusing posters as to just how to interpret a 25-basis-point as opposed to a 50-basis-point cut. Fifty it was, disappointing perhaps knzn who wanted a 175-basis-point cut, but delighting economic researchers like Refet Gurkaynak and Eric Swanson who both emailed me their high spirits at finally getting another data point for what happens when the Fed surprises the markets.
Economic indicators of success in Iraq
Some economists have been interpreting economic developments as shedding light on the success of the military surge in Iraq. I think one needs to use a bit of caution in drawing conclusions from such evidence.
Catch the wave
I keep trying to warn my friends in the Federal Reserve about the tsunami that’s coming their way.
The commercialization of space
Google seems to be thinking big.
OPEC production quotas
How should we interpret yesterday’s announcement from OPEC?
By how much will the Fed cut rates?
Once again we’re seeing a big divergence between what the markets expect the Fed to do and what the Fed expects the Fed to do.
Jobs numbers disappoint
Was that the other shoe we just heard drop?
Open thread on declining Saudi oil production
An article I wrote on Saudi Arabia’s Ghawar oil field appears in the latest issue of Atlantic magazine. I’m putting up this post primarily to provide a forum for readers who might want to offer comments on that discussion.