I was astounded not only by the outcome of the U.S. presidential election but also by the response of financial markets.
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Category Archives: Federal Reserve
Implications for the Agricultural Economy of Fiscal Policies Proposed by President Elect-Trump
In short: Rural areas will not like what they get from a combination of expansionary fiscal/counter-cyclical monetary policy.
Guest Contribution: “The Fed and Inequality”
Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared on October 25th in Project Syndicate.
Donald J. Trump on Fed Policy
From the Monday debate:
The Dollar, Tradables, and Monetary Policy
One argument for tightening monetary policy is derived from the argument the Fed needs to raise rates to close a “confidence gap”. Instead of psycho-analyzing the markets, I think it better to focus on data.
Term Spreads Today
A couple months ago, we were worrying about a yield curve inversion signalling recession. Now there are anxieties about surging long yields, as — apparently — inflation fears loom. It seems to me a little perspective is necessary.
Donald J. Trump: “The interest rates are kept down by President Obama.”
The entire quote is here.
“Policy Challenges in a Diverging Global Economy”
That’s the title of the volume of proceedings of the 2015 Asia Economic Policy Conference, edited Reuven Glick and Mark M. Spiegel.
Fed tightening cycles
Last December the Fed began what it thought at the time was a new cycle of tightening. Fed Chair Janet Yellen’s statements last week suggest the Fed still sees this plan as underway. A comparison with historical tightening cycles sheds some light on why so far the Fed hasn’t followed through.
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Too systemic to fail
Bryan Kelly at the University of Chicago, Hanno Lustig at Stanford and Stijn van Nieuwerburgh at NYU had an interesting paper in the June issue of American Economic Review that used option prices to measure the magnitude of the implicit U.S. government guarantee of the financial sector during 2007-2009.
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