Economics Topics
Economics Topics
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Fed Watch
Amid rising worries about food and energy prices, the head of the Federal Reserve’s Chicago branch said Monday that the Fed’s current monetary policy stance balances out the risks of economic weakness and inflationary pressure.
Charles Evans, in prepared remarks for a presentation at Harper College in Palatine, Ill., said, ...
In December, the Fed had $775B worth of Treasury securities. That stock will soon have dwindled to $300B, give or take. The difference, about $475B, represents an investment by the central bank in risky assets of the US financial sector. $475B is an extraordinary sum of money. It is as if the Fed borrowed more ...
In today’s Journal, Greg Ip reports that the Fed is formally asking Congress for authority — starting this year — to pay interest on commercial-bank reserves, in an effort to gain better control over interest rates and more leverage to battle the credit crunch.
In 2006, Congress gave ...
Reuters carried the story a few days ago and somehow I missed it.
WASHINGTON (Reuters) - The Federal Reserve's Board of Governors will hold a closed meeting on Wednesday [Apr. 30] to discuss paying interest on bank reserves, one of a number of options officials have been mulling to ...
Barry Ritholtz notes:
Another Tool for the Fed?, by Barry Ritholtz: Have you ever even thought about this?
"The Federal Reserve is formally asking Congress for authority -- starting this year -- to pay interest on commercial-bank reserves, in an effort to gain better control over ...
A veteran U.S. central bank official said Tuesday he’s worried about a deteriorating inflationary environment, and suggested that when the Federal Reserve begins to raise rates, it could do so swiftly.
Tim Duy says the economy is entering an eerie calm, and the Fed is holding steady as it waits to see what will happen next:
The Calm, by Tim Duy: The flow of data suggests economic activity is entering a very unnerving period of calm, not unlike the ...
Two recent events combined to make an ominous click: The Fed is now accepting wider collateral: Bonds ...
You have to read the text carefully to see it, but Federal Reserve Chairman Ben Bernanke appears to be inching closer toward blessing House Financial Services Chairman Barney Franks approach to aiding “underwater” homeowners whose houses are worth less than their mortgages.
Bernanke rejected Dodd's request in an April 25 letter, saying it's up to Congress and the Bush administration to address diminishing profits ...
The departure of two European Central Bank Governing Council members this summer could rebalance of group that has left interest rates unchanged since last June.
Nicholas Garganas, whose term expires June 14, announced on Friday that he won’t seek reappointment as head of the Greek central bank. ...
... The Federal Reserve announced today an increase in the amounts auctioned to eligible depository institutions under its biweekly Term Auction Facility (TAF) from $50 billion to $75 billion, beginning with the auction on May 5. ...
... the Federal Open Market Committee has ...
For immediate release
Central banks have continued to work together and to consult regularly on liquidity conditions in financial markets. In view of the persistent liquidity pressures in some term funding markets, the European Central Bank, the Federal Reserve, and the Swiss National Bank are announcing an expansion of their ...
Brian Wesbury on the Fed's Loose Monetary Policy Deja Vu; see also Brian's excellent testimony in Washington on the subject;
The governor of the Bank of England, Mervyn King, opines that finance jobs shouldn't be so remunerative.
Lots of luck with that, Mr. King.
Link via my colleague, Richard Warr.
My class was right... including about who the dissenters would be. (Though they actually predicted more dissent, I cautioned them that two was probably the most you'd see in the vote.) Not that this was a particularly hard call. On the surprise meter, today's move by ...
The string of dissent at the Federal Reserve continues. Today marked the sixth straight Federal Open Market Committee meeting drawing at least one dissent. Dallas Fed President Richard Fisher and Philadelphia Fed President Charles Plosser were the opposing votes in the 8-2 decision to lower the federal funds rate a ...
Economists and others weigh in on the Fed’s decision to cut interest rates by another quarter percentage point.
In a silent, but very lucid manner the Fed chief and the committee have clearly acknowledged the very real issues with inflation expectations that have developed and the non-trivial threat ...The Federal Reserve could use proposed new regulatory powers to try to stop credit and asset market excesses from reaching the point where they threaten economic stability, the US Treasury said on Tuesday.
David Nason, assistant ...
The Fed decided to cut rates to 2%. Here's the statement:
Press Release
The Federal Open Market Committee decided today to lower its target for the federal funds rate 25 basis points to 2 percent.
Recent information indicates that economic activity remains weak. Household and business spending has been subdued and labor ...
The Federal Open Market Committee decided today to lower its target for the federal funds rate 25 basis points to 2 percent.
Recent information indicates that economic activity remains weak. Household and business spending has been subdued and labor markets have softened further. Financial markets ...
It’s time for Ben Bernanke, a noted basketball buff, to show Wall Street his pivot move.
After an unprecedented three-month period of fastbreak policy easing and credit market intervention — when the Fed threw half-point and even three-quarter-percentage-point cuts in the fed funds rate at the economy and ...
Greg Ip of the WSJ:
Source:
Fed Weighs Pause After Next Rate Cut
Inflation Worries Loom as Economy Continues to Stall
GREG IP
WSJ, April 24, 2008; ...
LIBOR is normally close to the Fed Fund Rates which is sitting at 2.25%. Typically the ...
Greg Ip says:
The Federal Reserve is likely to cut its short-term interest rate by a quarter of a percentage point next week -- but then may be ready for a breather. ... If it does cut rates, the Fed could signal in the statement accompanying the ...
Tim Duy looks for - and finds - signs we are nearing the bottom of this cycle:
Time to Think About The Other Side?, by Tim Duy: It is easy to fall into “the world is ending” trap. But economic downturns do not last forever, and the current ...
The Bank of England will announce Monday a scheme which will see it lend money to banks in return for collateral in a bid to help the troubled U.K. mortgage market, U.K. Chancellor of the ...
The Bank of England came under further pressure to act quickly on the mortgage crisis today, as the Council of Mortgage Lenders reported that mortgage lending tumbled 17pc in March.
The trade ...
This week I’ll go over the forms of lending ...
Federal Reserve Bank of Philadelphia President Charles Plosser, who is a voting member of the Federal Open Market Committee and dissented last month when the Fed cut rates, addressed concerns about inflation in a speech at Drexel University, where he warned of rising inflation and said ...
Frankfurter Allgemeine has an article saying that Axel Weber, Bundesbank president, hinted at an ECB rate increase (yes, increase). The ECB was concerned about the rise in food prices, he said, and would have to evaluate whether the present monetary stance is consistent with price stability.
Two major Australian retailers are on the brink of collapse thanks to sustained Reserve Bank interest rate hikes which have knocked the economic life out of our suburbs.
Sporting goods and apparel chain Paul's Warehouse is facing ...
Today's CPI release has generated certain expectations (documented here, here, and I expect in pretty much every story covering the March inflation numbers) that a 50 bps cut in the overnight rate target is in the offing next Tuesday. Those expectations may very well be fulfilled - ...
The New York Federal Reserve accepted $24.999 billion of bids in its swap of Treasury securities for agency and agency mortgage collateral Thursday. Bids totaled $35.1 billion in the Term Securities Lending Facility auction, for a bid-to-cover ratio of 1.40, the New York Fed said Thursday. The ...
Setting aside the 100 largest banks, the share of commercial real estate loans in bank loan portfolios nearly doubled over the past 10 years and is approaching ...
In a speech in Charlotte, N.C., Federal Reserve Vice Chairman Donald Kohn today discussed risks to the financial system due to the changing nature of banks’ businesses, from securitization to asset-management for hedge funds. Mr. Kohn called on banks to improve their risk management through greater due diligence and stronger ...
Anyone who believes that the Fed can pretend that heavily damaged mortgage securities are worth more than toilet paper and literally build a $200 billion loan portfolio upon them does not understand finance. Just because Ben Bernanke declares something to be "valuable" does not bestow value upon ...
This section is worth repeating:
[R]esearch ... reveals that the single best predictor of subprime delinquency rates is the pace of house price changes. ...
Janet Yellen, president of the Federal Reserve Bank of San Francisco, said in a speech today that the housing sector “will be a major drag” on the economy into 2009. She also says “it would not be surprising” to see businesses slow or even cut spending this year due to ...
John Berry says the Fed needs to be given the power to oversee investment banks:
Fed Needs Permanent Investment Bank Oversight, by John M. Berry, Commentary, Bloomberg: ...Federal Reserve examiners now are operating inside the nation's biggest investment banks, and by all accounts the banks ...
Martin Feldstein says the Fed has cut the federal funds rate enough, further cuts will hurt the domestic economy more than they will help, and the cuts would have a negative impact on developing economies:
Enough With the Interest Rate Cuts, by Martin Feldstein, Commentary, WSJ: ...
One of the few positive developments from the housing bubble is that many mainstream economists have recognized the pernicious role played by the Federal Reserve. Indeed, some analysts on CNBC have discussed the outright abolition of the Fed. The case against the Fed is straightforward: In an attempt ...
There is nothing fundamentally broken on Wall Street that a little regulation and incentives for participants to be slightly more honest couldn't fix, said Federal Reserve Chairman Ben Bernanke said Thursday.
Bernanke's comments put him at odds with former ...
ONE benefit of the Federal Reserve’s rescue of Bear Stearns is that public outrage has aroused the political system to action in mitigating the foreclosure crisis.
Never mind ...
In the Term Auction Facility TAF, the Fed (via auction) swaps cash for questionable securities. This facility is for banks.In the Term Securities Lending Facility TSLF, ...
(Via David Beckworth at Macro and Other Market Musings, April 11:
Previously I discussed how much of what you learned in your money and banking class is now outdated given the many policy innovations by the Federal Reserve since last summer. Stephen Cecchetti now has a nice summary of ...
Fed 2002 Transcripts: Inflation Fight Personal
For Fed Vice-Chairman Roger Ferguson, keeping inflation low was a pocket book issue: Since in some sense Ive mortgaged my house based on keeping inflation low and stable, I think its pretty important that we understand that. This is the only ...
The 2002 transcripts include a stenographer’s markers for laughter in the Federal Open Market Committee meeting room. And the nation’s top economists didn’t just laugh at then-Chairman Alan Greenspan’s jokes. On the laugh track in 2002:
January 29, 2002: What the FOMC drinks during downtime
CHAIRMAN GREENSPAN. ...
At his first meeting as a Fed governor, future Chairman Ben Bernanke quickly established himself as a source of one-liners if not decisive policy advice:
As we search for the signal of an incipient recovery, we have heavy noise coming from two sides, he said in his first ...
I get tired of getting yelled at in comments for saying that the Fed should help to rescue financial markets, so I'm going to let Alice Rivlin say it this time. But I do agree with what she says:
Tim Duy says, given the way things stand at the moment, to expect a quarter point cut in the target interest rate the next time the Fed meets:
Looking – Again – For 25bp, by Tim Duy: Market participants are once again split on the outcome of the next FOMC ...
Stormy quotes Greg Ip at the Wall Street Journal:
The Federal Reserve is considering contingency plans for expanding its lending power ...
is considering contingency plans for expanding its lending power in the event its recent steps to unfreeze credit markets fail.
Among the options: Having the Treasury borrow more money than it needs to fund the government and leave the proceeds on deposit at ...
The Federal Reserve is considering contingency plans for expanding its lending power in the event its recent steps to unfreeze credit markets fail.
Among the options: Having the Treasury borrow more money than it ...
In a speech in San Antonio, Federal Reserve Bank of Dallas President Richard Fisher outlines causes of the latest financial crisis and recaps the central bank’s response. He compares the housing bubble to Texas’ 1980s boom and bust, starting with high oil prices and ending in widespread bank failures. ...
As reported by The Wall Street Journal, one of the more remote contingencies the Federal Reserve has considered is a mirror image of the Term Securities Lending Facility: it would take the mortgage backed securities pledged to it by dealers in return for ...
Federal Reserve governor Randall Kroszner said Wednesday that recent, aggressive steps by policy makers and financial institutions over the last six months are likely to prevent the U.S. from seeing a repeat of the lengthy and painful economic mess that Japan suffered through during its infamous lost decade during the ...
Since the Federal Reserve began rolling out ever more creative steps to unfreeze credit markets, it has sold or pledged a growing portion of its portfolio of Treasurys in order to put loans on its balance sheet to banks and securities dealers backed by mortgage-backed securities and other shunned collateral. ...
Click image for video or visit Bloomberg video.
Volcker Says Fed's Bear Loan Reaches Edge of Legal ...
Former Federal Reserve Chairman Paul Volcker roundly criticized the central bank’s extraordinary response to the financial crisis that’s been gripping markets since late last summer in a speech Tuesday.
The former official, in an address before the Economic Club of New York, had no less scathing words for the financial ...
Then he changed. During his tenure as Chairman ...
According to the minutes of last month's Federal Open Market Committee meeting released Tuesday, members said prospects for both economic activity and near-term inflation had deteriorated. ...
Some members ... thought it likely that U.S. economic activity ...
Many Federal Reserve officials appear to be bracing for a recession. Minutes of their March 18 policy meeting, released today, said some officials believed that a “prolonged and severe economic downturn could not be ruled out” due to credit constraints and weakening housing markets. The Federal ...
At maverecon Willem Butier counter's Alan Greenspan's latest claim the he and the US Fed not be held responsible, in large part, for our current mess. Butier lists eight "tragedies" of Fed policy/practice:The Greenspan Fed (August 1987 - January 2006) did indeed contribute, through excessively lax monetary policy, to the ...
In today’s Journal, Greg Ip examines former Fed Chairman Alan Greenspan’s legacy, which has come under attack amid the current crisis roiling the economy. Below are some excerpts:
Hailed three years ago as “the greatest central banker who ever lived,” the retired chairman of the Federal Reserve now ...
The WSJ has an interview with Greenspan in which he defends himself against his critics, many of whom were former acolytes. The WSJ discussion focuses on the views of the critics who only recognized Greenspan's failings in retrospect.
Critics who saw Greenspan's errors at the time felt it was a ...
I find it interesting that on his bio, you have to wade through all his corporate positions past and present before finding out the guy is chairman of the Federal ...
The Fed failed to identify the twin bubbles of the last decade — in the stock market and in real estate — and we have to ...
Robert Shiller says changes in the institutional structure of the financial system such as the breakdown of the traditional lines between what is and what isn't a bank require the Fed to reevaluate and expand its role in managing the economy. I agree, and I also agree that Ben Bernanke ...
One of the hottest (if not the hottest) intra-Austrian debates today is between what is sometimes referred to as deflationists and inflationists/stagflationists. This is not a policy debate of course, as all Austrians is anti-inflation, but rather a debate about whether the current recession will be associated with deflation or ...
Janet Yellen, president of the Federal Reserve Bank of San Francisco, offered a sobering view of the growth outlook in her latest speech. Ms. Yellen, who falls on the dovish end of the Fed spectrum, said the economy should improve in the second half with a “sluggish performance for the ...
With day after day of bleak news regarding the credit crunch -- and in particular, articles that constantly remind us that the Fed's recent actions haven't been tried since the Great Depression -- the average American is understandably perplexed. And although what I'm about to admit may not ...
Note: the IMF chart on page 13 is incorrect. This is the same error Bear Stearns made last year: see Bear Stearns and ...
The International Monetary Fund recommended in a housing study released today that central banks in countries with more developed mortgage markets such as the U.S. should take home prices into account when crafting monetary policy. However, monetary policy shouldn’t directly target housing prices, it said.
“Given the uncertainty surrounding both ...
The Fed wants to increase liquidity. But given the weakening in economic activity, this is not easily done. Obviously, if the Fed were to decide to set the interest rate target to nil, then it could have the freedom to pump as much money as it likes. But ...
In a Q&A back in March, Mark Thoma proposed that the Fed should simply buy up distressed assets, rather than simply accept them as collateral:
If it were my choice, If I were king of the Fed, I'd do more. First, I'd trade for any financial assets at a price ...
The Fed has added 3 new monetary policy tools on their webpage. Numbers 1-3 are in every economics textbook. Number 4 was new back in February when I first checked with my macro class. Numbers 5 and 6 were added in March.
Open Market ...
The Bank of England will need to cut rates gradually, probably allowing some slack to develop in the economy, if it is to reach its inflation target medium term, its Executive Director for Markets said Wednesday.
How does the current economic crisis compare to the Great Depression? Should Congress do anything to help homeowners and the states? Members of the Joint Economic Committee were looking to Ben Bernanke for guidance today.
As Rep. Elijah Cummings (D., Md.) told the Fed chairman: “You’re ...
The Federal Reserve System on Tuesday announced the availability of a set of dynamic maps and data that illustrate subprime and alt-A mortgage loan conditions across the United States.
The maps, which are maintained by the Federal Reserve Bank of New York, will ...
The Federal Reserve is posting maps to illustrate subprime loan conditions across the U.S.
The Fed on Tuesday announced the maps will be maintained by its district bank in New York. Monthly updates are planned. The maps will display regional variation in the condition of securitized, owner-occupied ...
Federal Reserve Chairman Ben Bernanke still sees some trouble spots in the economy, but he didn’t characterize the U.S. as being in a recession during a meeting with U.S. lawmakers Tuesday, one of the meeting’s participants said.
CNBC's Steve Liesman reports on a letter from Treasury Secretary Paulson to New York Fed President Tim Geithner. In the letter, Treasury agrees that the Fed can bill Treasury for any losses from the Bear Stearns deal.
A few points on the new plan:
1. The Fed is smarter than other regulators, the Fed can pay higher salaries, and the Fed has more independence.
2. Ceteris paribus, the Fed usually can do a better job than other potential regulators. If someone is going to oversee hedge funds and ...
Treasury Secretary Hank Paulson has set himself upon a Herculean task. He wants to replace the hodgepodge of financial regulators that has grown up over the past century with a Prudential Financial Regulatory Agency (“PFRA”) and a Conduct of Business Regulatory Agency (“CBRA”) (see
ECB Governing Council member Christian Noyer made the clearest public case to date for why the ECB isn’t following the Fed with interest-rate cuts.
Mr. Noyer — a noted moderate who heads of France’s central bank — commended the Fed’s proactive response in a Prague speech, saying ...
Ok. Clearly Robert Reich hate Secretary Paulson's self-proclaimed reform proposal, concluding: "Hank Paulson’s discussion paper – it's not even meant to be enacted under the Bush Administration – is not broad, it’s not an overhaul, and heaven forbid, if we’re facing another Great Depression, it will do absolutely ...
Speaking from his now official apartment at the Philadelphia Mint ...
On a day that authorities proposed to give the Federal Reserve broad new regulatory powers, San Francisco President Janet Yellen argued more aggressive action may be required to address mortgage-related troubles.
How does the Fed feel about Treasury’s blueprint for a new regulatory structure? It depends partly on who you ask. By proposing to take the Fed largely out of the business of supervising banks, it creates more anguish for the 12 regional reserve banks than for the Board of Governors ...
Socialist-style Fed or financial saviour?
The cover of the latest issue of BusinessWeek shows Ben Bernanke in profile against a bright red and orange backdrop, pensively stroking his grey beard and looking remarkably like Vladimir ...
Getting your OMOs confused with your TAFs, PDCFs and TSLFs?
The Federal Reserve’s alphabet soup of innovation is running over the side of its bowl with the central bank’s new programs designed to prevent economic disaster. (Or at least prevent more of a disaster than ...
Monetary policy’s role in the economy? Limited, says Federal Reserve Bank of Philadelphia President Charles Plosser.
“There seems to be a view that monetary policy is the solution to most, if not all, economic ills,” Plosser said in a speech Friday. “Not only is this not true, it is a dangerous ...
Minneapolis Fed President Gary Stern told a London audience today he’s not concerned the central bank could run out of ammunition to boost the economy — after slashing the federal funds rate to 2.25%. “That’s not at the top of my list of concerns.”
Asked what is his No. ...
Eric Rosengren, president of the Federal Reserve Bank of Boston, discusses at a conference in Seoul the importance of the central bank having access to non-public information at financial institutions. He says the Fed’s supervisory authority over banks is helping officials understand problems in U.S. financial markets and assess ...
Atlanta Fed President Dennis Lockhart says in remarks to the Rotary Club of Chattanooga that the economy “is in a slowdown that resembles past periods that were the leading edge of a recession.” Though some strengths — such as strong business balance sheets and export growth — may prevent ...
Gary Stern, president of the Federal Reserve Bank of Minneapolis, discusses in a speech today the problem of banks being “too big to fail” (about which he co-authored a book) and the risks of government bailouts. He also addresses bubbles — as in housing today or technology stocks in ...
I would give the Federal Reserve either a C or C-, reflecting an average of one good grade and one poor grade.
The Fed has ...
Federal Reserve Bank of Dallas President Richard Fisher said monetary policy may not be the best tool to repair impaired financial markets right now, especially when inflation pressures remain worrisome.
FisherIn the current environment, ...
The global financial crisis is spreading towards the real economy in the US and towards other developed countries. A frightening example came from Iceland, where the central bank yesterday raised interest rates by 1.25% to 15% to bring down inflationary expectations. We have not seen such action in ...
Because we're tied up doing other projects at the moment, we thought it might be fun to take a moment to consider just what the heck the Federal Reserve is doing lately. ...
The Federal Reserve Bank of St. Louis, after looking at several outsiders to succeed its retiring president, turned to an 18-year veteran of the banks research staff, James B. Bullard. Mr. Bullard, 47, is to take office April 1, succeeding William Poole, who is retiring after 10 years in ...
The FT leads its Saturday edition with a story that the Fed and the Bank of England have put pressure on the ECB to take part in a scheme to accept junk mortgage based paper as collateral in repo operations. The article said the idea came ...
Central banks on both sides of the Atlantic are actively engaged in discussions about the feasibility of mass purchases of mortgage-backed securities as a possible solution to the credit crisis.
Such a move would involve the use ...
(Jim Hamilton has been narrating these changes since the ...
"Stage III of a financial crisis is when a central bank runs out of ammunition--when pushing interest rates too the floor and swapping out all of ...
“There’s one nomination here that would be for somebody [for] 14 years,” Dodd told reporters on a ...
Central banks on both sides of the Atlantic are actively engaged in discussions about the feasibility of mass purchases of mortgage-backed securities as a possible solution to the credit crisis.
...
Any move to buy mortgage-backed securities would require government ...
The U.S. Federal Reserve, responding to press reports, said it is not discussing coordinated purchases of mortgage-backed securities with other central banks.
The Federal Reserve is not involved in discussions with foreign central banks for coordinated buying of MBS, a senior Fed official said.
The Financial Times reported on its web site ...
Jeff Sachs says Greenspan and the Fed are to blame for our current troubles. Greenspan disagrees:
The roots of crisis, by Jeffrey Sachs, Project Syndicate: The US federal reserve's desperate attempts to keep America's economy from sinking ... do not seem to be effective. Although ...
The Federal government limints the amount of loans a bank can give out based on the amount of cash they have in the vault. So ...
The Federal Reserve Bank of New York announced the terms of its first Treasury swap auction set for March 27, indicating that it will offer $75 billion in government securities to the primary dealer banks and modifying the type of collateral it will accept in return.
The Term ...
A roundup of economic news from around the Web.
From Real Time Economics (New York Fed Unveils TSLF Terms):
The Federal Reserve Bank of New York announced the terms of its first Treasury swap auction set for March 27, indicating that it will offer $75 billion in government securities to the primary dealer banks and modifying the ...
From the not-always-reliable Real Time Economics blog:
and the exception, the Royal Bank of Australia, which has been raising rates lately to fight inflation in the commodity-rich economy, to boost its key rate from 7.25% to 7.5% later this year.
This discussion of the birth of the Federal Reserve System and the regulatory responses to the problems Paul Krugman describes begins with an illustration of how to stop a bank run:
Born of a panic: Forming the Federal Reserve System, The Region, FRB Minneapolis: The banker was ...
If Bernanke believes his own research, and if the zero interest rate bound begins to come into play, we should expect to hear lots of discussion from FOMC members about the future course of monetary policy. Here are a few excerpts from papers on the topic of "Monetary Policy ...
Justin Fox follows up on the post noting that all of the current Federal Reserve Governors have been appointed by Bush:
Why is the Federal Reserve Board made up entirely of Bush appointees? Because Fed governors don't serve out their terms, by Justin Fox: Mark Thoma points out that ...
Here is a snapshot of what Curve Watcher's Anonymous is looking at today.
Quick hits:
FOMC Statement
http://federalreserve.gov/newsevents/pres
s/monetary/20080318a.htm
Very different statement than previous ones; the Money quotes are underlined:
Recent information indicates that the outlook for economic activity has weakened further. Growth in consumer spending has slowed and labor markets have softened. Financial markets remain under considerable stress, and the tightening of credit ...
The 90 day T-Bill is now at half of a percent, and looks to be in freefall. Remember this is after the Fed annouced that I-Banks would have ...
From Reuters:
Goldman Sachs plans to test the program sometime this week, a spokesman said. Morgan Stanley Chief Financial Officer Colm Kelleher said his bank has already tested the program, and a spokeswoman for Lehman said the investment bank has also done so.
The Wall Street Journal reports that there ...
The pattern is always the same. When the Fed cuts interest rates, investors pile into the markets, pushing up share prices for a few hours. It takes then only a few hours until some other scare story comes up, and the whole process goes into reverse. US shares shot ...
As dissension in central banking goes, yesterday's discord was fairly tepid but significant nonetheless.
The Fed's whopping 75-basis-point cut on Tuesday, which lowered the Fed fund rate to 2.25%, was approved by eight and questioned by two. Richard Fisher and Charles Plosser, questioning the FOMC majority, voted against the rate cut. ...
How much ammo is left in that fed funds gun?
The Federal Reserve is trying a range of new tricks to push new forms of lending as a means of preventing what they fear may otherwise be a major collapse in financial markets. What all these strategies have in common is an unwillingness to ...
The Real Time Economics Blog collected some reactions from Wall Street concerning the rate cut. One firm chose to emphasize their concerns about inflation.
These actions were taken despite rising inflation pressures. The Fed expects these pressures will subside as energy and other commodity prices flatten out, and as ...
The Fed dutifully cut, by 75 basis points, a little less than what been expected by markets this week, but, lest one forgets this, still one of the largest ever rate cuts in history. The stock market reacted positive to the next, after some volatility. There was a strong ...
With the Fed's target interest rate falling, there's been some worry about running up against a "zero interest rate bound." This