Some quick links on the flash crash, China’s rare earth elements monopoly, Larry Summers, and economics at UCSD.
Author Archives: James_Hamilton
Another disappointing GDP report
The U.S. economy managed to keep growing in the third quarter, but well below what’s needed for a normal economic recovery.
Negative real interest rates
What message should we take from negative real interest rates?
Richard Clarida’s retrospective on the financial crisis
I earlier discussed several of the presentations at the monetary policy conference at the Federal Reserve Bank of Boston last week. But missed in the popular coverage of the conference was an insightful discussion by Columbia Professor Richard Clarida that expressed very nicely the conclusions that I have come to as well on the events that led us into these problems.
Arguments against QE2
Having earlier reviewed some of the reasons in favor of additional quantitative easing (QE2), I’d like to acknowledge some of the dissenting views.
More than one tool for the Fed
One theme that emerged from the monetary policy conference at the Federal Reserve Bank of Boston on Friday and Saturday is that, as I stressed in my discussion of the recent FOMC minutes, the Fed is not thinking of large-scale asset purchases as the only tool available in the current environment.
More discussion of options for the Fed
I’m in Boston today at a conference at the Federal Reserve Bank. Fed Chair Ben Bernanke spoke this morning and this afternoon I presented results from my research with Cynthia Wu. I hope to have time later this weekend to say a little more about some of the presentations and discussion. But for now let me provide a link to an interview with CNBC on some of these issues.
Why is the Fed doing this?
Most observers now seem convinced that the Federal Reserve will shortly implement QE2, a second round of quantitative easing. It’s worth taking a look at what QE2 is and is not expected to accomplish.
The market moves ahead of the Fed
Over the last month, a consensus seems to have emerged that (1) the Fed has the ability to depress long-term yields further, and (2) the Fed has the intention to implement such measures. That raises the possibility that recent market moves represent a bet already placed by market participants on the basis of the logical implications of (1) and (2).
Hangin’ in there
Recent economic indicators tell more of the same story– disappointingly weak growth.