nytimes.com - 4/20/2009
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WITH unemployment rising and the financial system in shambles, it’s hard not to feel negative about the economy right now. The answer to our problems, however, could well be more negativity. But I’m not talking about attitude. I‘m talking about numbers. Let’s start with the basics: What is the ...
gregmankiw.blogspot.com - 4/22/2009
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gregmankiw.blogspot.com —
Commentary on my negative interest rate piece in
the NY Times (and the follow-up here ) continues...
to pour in. To answer the most common queries: Yes, the serial-number-lottery plan was tongue-in-cheek. The goal of mentioning it was to get people ...
(more)
More on Negative Interest Rates
gregmankiw.blogspot.com - 4/23/2009
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gregmankiw.blogspot.com —
Click here to read my column in tomorrow's
NY Times ....
(more)
Going Negative
tvhe.co.nz - 4/23/2009
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tvhe.co.nz —
Earlier we discussed a negative OCR as a
way to push us towards the “zero bound” on...
interest rates. But Greg Mankiw has brought up an interesting point - what happens if we want negative interest rates ? Mankiw admits that we could have a lottery scheme where some currency ...
(more)
From a negative OCR to negative interest rates …
Comments
Blog Reactions
Economics "Professor" Advocates Theft
The Market Ticker —
... What sort of crap is this?
Imagine that the Fed were to announce that, a year from today, it would pick a digit from zero to 9 out of a hat. All currency with a serial number ending in that digit would no longer be legal tender. Suddenly, the expected return to holding currency would become negative 10 percent.
That move would free the Fed to cut interest rates below zero. People would be delighted to lend money at negative 3 percent, since losing 3 percent is better than losing 10.
No, people ...
Waiting For Stupendous Man
MaxedOutMama —
... But if I look around, the picture becomes even more disturbing. It is natural for people to be somewhat upset about the swine flu. Very few of the public can have much perspective on the numbers, and we've all been warned about the dangers of a flu pandemic. Yet DU's flu performance, although most confounding and disturbing, looks remarkably sane compared to this NY Times editorial by Gregory Mankiw recommending achieving negative nominal interest rates (and real interest rates are already negative). He advances a remarkably bizarre suggestion to announce that the US will ...
On penalty cash rates
The visible hand in economics —
Scott Fullwiler from New Economic Perspectives (ht Economists View) describes some issues he has with the “negative interest rate” idea being put forward by Willem Buiter , Greg Mankiw , and Scott Sumner
Now I have previously put my foot forward and said I agree with this idea (here and here) and I still feel the same, let me describe why with reference to Dr Fullwiler’s post.
In short, the proposal assumes that banks either need the reserve balances (if you tax all reserve ...
Related Content
Fed staff goes negative
gregmankiw.blogspot.com 4/28/2009 — The FT reports : Fed study puts ideal interest rate at -5% The ideal interest rate for the US economy in current conditions would be minus 5 per cent, according to internal analysis prepared for the Federal Reserve's last policy meeting. The ...
Private borrowing is still negative
krugman.blogs.nytimes.com 6/11/2009 — Flow of funds data out today. I won't have time to do a careful analysis for a few days, but a quick check shows that the Setser point - high government borrowing is more than offset by net negative borrowing from the private sector - remains true.
More on Negative Interest Rates
gregmankiw.blogspot.com 5/8/2009 — From LSE economist (and former central banker) Willem Buiter , who concludes Removing the zero lower bound on nominal interest rates would represent a valuable addition to the policy arsenal of the central banks. We know something about how interest ...
The Fed: Our Next Troubled Bank?
istockanalyst.com 4/27/2009 — Mike Larson The Federal Reserve is watching the backs of U.S. banks. But sometimes I wonder, “Who’s watching the Fed’s back? Is the Fed our next troubled bank?” You see, all of this garbage paper that’s going bad — the troubled residential mortgage ...
Economic View - It
nytimes.com 2/7/2009 — WHAT approach will the Obama administration and the Democratic majority in Congress take on international economic policy? It is too early to say for sure, but the signs so far are worrying. Just before his confirmation as Treasury secretary, Timothy ...
S&P: "First quarter ever of negative earnings"
calculatedriskblog.com 2/13/2009 — "This ... will be the first quarter ever of negative earnings" Howard Silverblatt, senior index analyst, at Standard & Poor's. From MarketWatch: S&P; heads to first quarter ever of negative earnings [N]early 400 of the S&P;'s 500 companies have ...
Negative interest rates
marginalrevolution.com 4/20/2009 — Greg Mankiw has a very good post (and column ) on the idea of negative interest rates. I have long found this a good conundrum to tease (these sad days I dare not use the word "torture") graduate students with. Here is one ...
Op-Ed: Fed Up With the Fed
minyanville.com 3/11/2009 — Editor's Note: James Quinn is a senior director of strategic planning for a major university. James has held high-level financial positions with a retailer homebuilder and a university in his 22-year career. He can be found online at ...
What to do with the Fed
blogs.ft.com 7/19/2009 — The Fed is in trouble. Obama administration proposals for enhancing the Fed’s supervisory and regulatory role and for assigning it new macro-prudential responsibilities and powers - effectively turning it into the nation’s systemic ...
More on Negative Interest Rates
gregmankiw.blogspot.com 5/27/2009 — From Glenn Rudebusch of the San Francisco Fed : The recommended future policy setting of the funds rate based on the estimated historical policy rule and these economic forecasts is given as the dashed line in Figure 2. This dashed line shows that, ...
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