The Bureau of Economic Analysis reported today that the seasonally adjusted real value of the nation’s production of goods and services grew at a 5.7% annual rate during the fourth quarter. That’s great news, but…
Author Archives: James_Hamilton
A budget freeze?
Here I offer some thoughts on President Obama’s new proposal.
Why Bernanke should be reconfirmed
Econbrowser readers are well aware that there are a number of issues on which I have concerns about some of the decisions the Fed has made, such as
dropping the ball on regulation ([1],
[2]),
keeping interest rates too low for too long over 2003-2005 ([1],
[2]),
taking some real risks with the Fed’s new balance sheet ([1],
[2],
[3]), and
pretending the Fed had nothing to do with the commodity price boom of 2008 ([1],
[2]). Notwithstanding, there is no question in my mind that Bernanke should be reconfirmed as Chair of the Federal Reserve Board. Here’s why.
Inflation fears
Is it reasonable to worry about inflation in the current environment?
How the Federal Reserve earned its profit
I was curious to take a look at the details behind the following story:
The Federal Reserve Board on Tuesday announced preliminary unaudited results indicating that the Reserve Banks provided for payments of approximately $46.1 billion of their estimated 2009 net income of $52.1 billion to the U.S. Treasury. This represents a $14.4 billion increase over the 2008 results.
Haiti relief efforts
One of the organizations to which I have made a contribution is Heart to Heart International.
Links for 2010-01-13
Stuart Staniford, who earlier had been persuaded that global oil production might have already peaked, now comments on the potential for increased production from Iraq to push the peak up to a decade down the road.
King Banaian on disturbing developments in Argentina and Venezuela.
Economists comment on the role of the Fed in the housing bubble. Two in particular worth emphasizing:
Marvin Goodfriend: Interest rate policy was appropriately stimulative in the 2002-3 period. But rates should have been raised less mechanically and more aggressively in 2004-5 on grounds of the usual macroeconomic conditions…. A somewhat tighter stance of interest rate policy then could have cut off the last year or so of the house price appreciation and prevented the worst part of the subsequent adjustment.
Mark Gertler: If we could go back in history and make one policy change, I’d go after sub-prime lending. Absent non-prime lending, the likely outcome of the housing correction of 2007 would have been a mild recession like 2000-2001, and not the debacle we experienced.
More of the same
The U.S. economy continues to recover at a painfully slow pace.
Bernanke grades the Fed
Fed Chair Ben Bernanke’s observations on monetary policy and the housing bubble have received a lot of attention. Like many other commentators (e.g., Arnold Kling, Paul Krugman, and Free Exchange), I agree with Bernanke’s conclusions, but only up to a point.
Inflation in China
Why hasn’t inflation caught up with a monetary-induced boom in China?