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John Taylor on the Federal Reserve
econbrowser.com - 12/14/2008
John Taylor on the Federal Reserve
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Stanford economics professor John Taylor has a new paper in which he takes aim at recent economic policy, and fires with both barrels, concluding that "government actions and interventions caused, prolonged, and worsened the financial crisis." Taylor begins with an argument he ...
Federal Reserve balance sheet
econbrowser.com - 12/22/2008
Federal Reserve balance sheet
— econbrowser.com — Here I survey how we got here, where things currently stand, and what it all means. Let... me begin by reviewing some first principles of what the Fed is all about. How did the cash currently in your wallet get there? You withdrew it from an ATM, ... (more) Federal Reserve balance sheet

Comments vote down Abnormal Returns found this 12/22/2008found this
Quantitative easing
econbrowser.com - 12/16/2008
Quantitative easing
— econbrowser.com — Today's announcement from the Federal Reserve marks the end of the road for Plan A (fighting the... recession by lowering interest rates), and the beginning of ... what? The Fed's announcement begins : The Federal Open Market Committee decided ... (more) Quantitative easing

Comments vote down EconLog: Library of Economics and Liberty found this 12/16/2008found this
blogs.wsj.com - 12/17/2008
Real Time Economics : The Fed Speaks: More on Today's Decision
— blogs.wsj.com — Federal Reserve held a media conference call after today’s Federal Open Market Committee meeting, a unusual move... that allowed reporters to receive some explanations for the Fed’s move today. The Fed’s ground rules allowed news organizations to ... (more) Real Time Economics : The Fed Speaks: More on Today's ...

Comments vote down Econbrowser found this 12/17/2008found this

Blog Reactions

Lawrance G. Lux:  Monetary Policy Error

The Prudent Investor:  US Treasuries - The Biggest Bubble Of All

Abnormal Returns:  Sunday links: hidden risks

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Blog Reactions

Monetary Policy Error
Lawrance G. Lux — James Hamilton presents some doubt to John Taylor’s assertions that fed policy actually aggravated the current Crisis, blaming the difficulty on a lack of regulation of the various financial institutions involved. I would forward a third thesis: that the Bush Tax Cuts actually provided inordinate levels of liquidity, straited that liquidity almost solely to Investment capital, and increased the Income generation of that liquidity. The increased volume of funds excited a laxity of loan policy in financial institutions, which grew with practice under the constraints of bonuses ...

US Treasuries - The Biggest Bubble Of All
The Prudent Investor — ... investors were willing to pay $54,700 to insure a portfolio of $10 million 10-year debt paper. Summarizing the fundamentals such as no end to new debts, tax shortfalls, higher social and military expenditures, a central bank willing to monetize the debt and flooding the world with fresh Federal Reserve Notes, it can be safely bet that this bubble will end like all bubbles: In a gigantic burst that will unsettle everything we have learned about investing in the past. A hat tip to Econbrowser who undug this paper by Stanford economics professor John Taylor on the ...

Sunday links: hidden risks
Abnormal Returns — ... “Government actions and interventions caused, prolonged, and worsened the financial crisis.”  (Econbrowser) ...

links for 2008-12-15
Economist's View — John Taylor on the Federal Reserve - Econbrowser John Taylor: The Fed Done It - Arnold Kling News You Can Lose -  by James Surowiecki Fed’s Words May Speak Louder Than Actions Now - John M. Berry Yet Another Massive Failure To Communicate - Capital Gains and Games European macro algebra (wonkish) - Paul Krugman Policymakers to prop up US housing market - FT On the economics of the MSM print media - Stephen Gordon ...

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Super Low Treasury Rates Reducing Repos and With Them, Liquidity — naked capitalism
We have from time to time chronicled how various Treasury and Federal Reserve interventions have produced unintended, undesirable consequences. The latest example: the Fed's efforts to push Treasury rates into ZIRP-land is reducing the incentives of traders to repo Treasuries to each other. ...
Trepidation About Quantitative Easing, Version 2.0 — naked capitalism
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Quantitative easing — Econbrowser
Today's announcement from the Federal Reserve marks the end of the road for Plan A (fighting the recession by lowering interest rates), and the beginning of ... what? The Fed's announcement begins : The Federal Open Market Committee decided today to establish a target range for the ...
UAE central bank will not follow US Federal Reserve — The Emirates Economist
Gulf News The UAE Central Bank said on Tuesday it would not cut interest rates if the US Federal Reserve eases its rate - the second time the country would refrain from mirroring the Fed. Until late October, the UAE had been keeping its benchmark overnight repurchase rate at the same level as ...
How the Fed Gives Investors Confidence — The Big Picture
Economist Stuart Hoffman at PNC Financial Services says the Federal Reserve’s broadened attack to revive lending is likely to help to economy get back on track, but he said the Fed can’t act alone. Interview with MarketWatch’s Stacey Delo. 12/16/2008  ...
Fed shoots its last bullet — BloggingStocks
The Federal Reserve just announced a bigger-than-expected rate cut. And with that, it has used up its short-term rate cutting ammunition for the first time in history. The sad part is that even though the Fed has been cutting rates -- from 5.25% last summer to today -- the economy has not ...
Hale "Bonddad" Stewart Is Scared — J. Bradford DeLong's Grasping Reality with All Eight Tentacles
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The Federal Reserve made history today with its anticipated rate cut, a slashing that could have an impact on a number of exchange traded funds (ETFs), not to mention the broader economy. The rate cut, to a range of 0% to 0.25%, is the lowest on record. The central bank also said it would use...
Zero Interest Rate Policy officially arrives — The Mess That Greenspan Made
The Federal Reserve slashed their target short-term lending rate to a range of 0.0 percent to 0.25 percent and signaled the beginning of an era of "quantitative easing" where the central bank will buy a wide variety of assets to support the struggling U.S. economy. Just 15 months into the ...
Fed shoots its last bullet — BloggingStocks
The Federal Reserve just announced a bigger-than-expected rate cut. And with that, it has used up its short-term rate cutting ammunition for the first time in history. The sad part is that even though the Fed has been cutting rates -- from 5.25% last summer to today -- the economy has not ...
Will the Fed risk its solvency to pursue Bernanke's academic theory? — BloggingStocks
Federal Reserve Chairman Ben Bernanke likes to tout his expertise in studying the Great Depression. To show off the knowledge, he's taken a Fed balance sheet with $800 billion in Treasury securities a year ago and nearly tripled it to $2.26 trillion by acting as the toxic waste absorber for a ...
Analysis on Fed’s Expected Interest Rate Cut — The Big Picture
After a two-day meeting, the Federal Reserve is expected to cut the federal interest rate yet again bringing it to an all-time low. WSJ’s Sudeep Reddy shares his analysis on what the move will do. 12/15/2008
Federal Reserve Bond Sales? — GoldSeek.com
Rumor has it that the Federal Reserve is considering selling bonds. The legality is in question. Leaving that aside, why would the Fed do such a thing? If it did, how would such a thing work? What would be its effects?
Gold To Remain In Bull Market While Counter-Party Risk Is Elevated And Interest Rates Remain Low — Daily Markets
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