Congressman Ron Paul (R-TX) is apparently proposing that the U.S. Treasury simply refuse to pay interest and principal on the $1.6 trillion in Treasury securities currently owned by the Federal Reserve. Dean Baker, Greg Mankiw,
Steve Williamson, and
Stephen Gandel all seem to think it’s not a totally crazy idea. Here’s what I think they’re missing.
Author Archives: James_Hamilton
Hanging in there
Higher oil prices slowed the economy in the first half of this year. But I don’t expect things to get a whole lot worse.
The effectiveness of quantitative easing
This week I attended a conference hosted by the Federal Reserve Bank of St. Louis on quantitative easing. The purpose of the conference, as explained by Bank President James Bullard in his opening remarks, was to answer Stanford Professor John Taylor’s challenge to provide research of real-time usefulness to policy makers. The conference featured analyses by 5 different research teams of the effects of recent quantitative easing measures adopted in the United States and United Kingdom.
Links for 2011-06-29
Some quick links to recent analyses of health care costs, oil price shocks, and forecasting commodity prices.
The Strategic Petroleum Reserve drawdown
The International Energy Agency announced on Thursday that its 28 member countries had agreed to release 60 million barrels from their combined strategic stockpiles. The U.S. plans to contribute half of this total, all in the form of sweet crude. Thirty million barrels represents about 10% of the U.S. strategic petroleum reserve of 293 million barrels of sweet crude oil, and about 4% of the entire 727 million barrels stockpiled in the U.S. SPR.
Making jobs priority one
It is looking unlikely that there will be more stimulus from either fiscal policy or monetary policy. Former President Bill Clinton has called for suggestions for other policy options that might be helpful. Here are a few ideas along those lines.
Monetary policy since 2000
I just returned from the annual conference of the
Society for Financial Econometrics
hosted by the University of Chicago. One of the many interesting papers described changes in Federal Reserve policy over time.
A game of chicken
Making a political game out of the debt ceiling is playing with fire.
Links for 2011-06-13
Some items I found interesting:
- Tyler Cowen outlines what I see as the responsible approach to the U.S. federal fiscal challenges: slow the growth of government spending.
- Some undergraduates at Rutgers University have developed a nice site to track economic indicators. And Bill McBride has an invaluable summary of which ones really matter.
- From the Federal Reserve Bank of Boston: Oil and the Macroeconomy in a Changing World: A Conference Summary.
- The Office of Personnel Management on shifting costs of Postal Service retirement funding to U.S. taxpayers.
- And Glenn Reynolds warns beware of bimbots.
Chinese oil demand
Stuart Staniford notes that the number of trucks and passenger vehicles in China has been growing at about 23% each year.