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Monetary Policy

The Best Monetary Policy Is Strict Financial Regulation

Anthony W. Orlando | Posted 04.18.2014 | Politics
Anthony W. Orlando

In recent years, private-sector forecasters have been surprisingly accurate at forecasting changes in the unemployment rate, but they have been equally inaccurate when forecasting changes in the federal funds rate, the baseline interest rate controlled by the Fed.

Will Bitcoins Become the People's Federal Reserve?

Fred Lundgren | Posted 03.26.2014 | Money
Fred Lundgren

Henry Ford said, "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there wou...

Anatomy of a Market Lie: CNBC Misreads the Fed and Helps Out Short Sellers

Terry Connelly | Posted 03.20.2014 | Business
Terry Connelly

Despite Yellen's evident caution and discomfort in expressing any specific quantitative definition of "considerable period," the stock and bond markets chose to take Yellen ultra-literally about the six months and turned suddenly and violently downward.

The Fed Moves the Goal Line

Michael Farr | Posted 03.20.2014 | Business
Michael Farr

I believe that the Fed has overreached in its monetary policy not just in response to the latest crisis, but pretty consistently over the 15-20 years. In an effort to lessen the effects of (inevitable) economic downturns, the Fed (and other central banks) has caused extreme financial distortions and dislocations.

Don't Blame Western Monetary Policy For Emerging Market Woes

The WorldPost | Nathan Gardels | Posted 02.22.2014 | World

The following is an excerpt on the role of the G-20 from a speech by Britain’s Chancellor of the Exchequer, George Osborne, given at the British Cha...

A Different Chair

Joao Gomes | Posted 04.08.2014 | Business
Joao Gomes

Three aspects in particular strike me as liable to become important in the coming years. First, while much of Bernanke's personal interest and expertise was on financial markets and monetary policy, Yellen's own focus has always been more on understanding labor markets frictions and outcomes.

U.S. Monetary Policy and Its Effects on Latin America

Alejandro Werner | Posted 03.18.2014 | Business
Alejandro Werner

The volatility since May 2013 tells us that the process of normalization of U.S. monetary policy will be complicated and volatile. So it is smart to prepare for bumps.

Turkey: How To Boost Growth Without Increasing Imbalances

Isabel Rial | Posted 03.17.2014 | Business
Isabel Rial

In our recent annual review of Turkey's economy, regression analysis suggests that, barring a significant change in policies or the economic environment, the level of growth consistent with a stable current account is in the 2¾ to 3½ percent range. In other words, growth above this speed limit would lead to a wider current account deficit.

Calibrating 2014

Otaviano Canuto | Posted 03.04.2014 | World
Otaviano Canuto

The global economy looks poised to display better growth performance in 2014. Leading indicators are pointing upward -- or at least to stability -- in major growth poles. However, for this to translate into reality policymakers will need to be nimble enough to calibrate responses to idiosyncratic challenges.

International Policy Coordination: The Loch Ness Monster

Olivier Blanchard | Posted 02.15.2014 | Business
Olivier Blanchard

International policy coordination is like the Loch Ness monster: much discussed but rarely seen. Going back over the decades, and even further in history to the period between the Great Wars, coordination efforts have been episodic.

Weidmann at Harvard: The Sovereign-Banking Nexus

Luka Orešković | Posted 02.05.2014 | Business
Luka Orešković

Weidmann's "separatist" view clearly stems from the German concept of highly independent central banking, assuring price stability rather than trying to target other problems and ensure macroeconomic stability.

Brazil, Korea: Two Tales of a Macroprudential Regulation

Otaviano Canuto | Posted 02.01.2014 | World
Otaviano Canuto

The pervasiveness and relevance of asset price booms and busts in modern economies has now been fully acknowledged. So has the case for combining prudential regulation and monetary policy in the complementary pursuit of financial and macroeconomic stability.

Central Bankers Considering Larry Summers' Desperate Idea For Ending The Depression

The Huffington Post | Mark Gongloff | Posted 11.20.2013 | Business

If you think people who save money are being punished by low interest rates, wait until they have to deal with negative interest rates. Slashing ra...

QE Tapering as a Wake-up Call for Emerging Markets

Otaviano Canuto | Posted 01.23.2014 | World
Otaviano Canuto

Emerging markets are not currently as vulnerable as they were in previous moments of global interest rate hikes.

Transitions to Financial Stability: A Bumpy Ride

José Viñals | Posted 01.23.2014 | Business
José Viñals

The global financial system faces several major transitions along the road to greater financial stability. These transitions will be challenging because they are accompanied by substantial risks.

The Truth Behind Emerging Economies: Colombia Case

Felipe Ángel | Posted 01.23.2014 | World
Felipe Ángel

America's financial and economical decisions will have an effect on emerging economies in the times to come. The reversal of flows will destabilise emerging economies, and an effort to attract investment will have to be made in order to keep the increasing growth rates in the GDP.

Krugtron the Invincible, Part 2

Niall Ferguson | Posted 01.23.2014 | Business
Niall Ferguson

Why, you may ask, did Krugman feel the need to be so bold (and so wrong) in predicting the euro's collapse over and over again, in his column, on his blog and to every media outlet that would give him an interview?

Debt Ceiling & Budget Deficit Debate -- The Secret Root of the 'Problems'

Asher Edelman | Posted 01.23.2014 | Business
Asher Edelman

Though the handouts to the larger banks have exceeded a trillion dollars over the five years of the QE programs most, if not all, of these institutions remain underwater if their assets were to be marked to the market.

Trust and Money

Ricardo B. Salinas | Posted 01.23.2014 | Business
Ricardo B. Salinas

Despite some recent apparent signs of improvement, in the past two years we've had very negative economic news from Europe, particularly from countries such as Spain, Ireland, Greece, Cyprus, Italy, and Portugal. High unemployment, failed banks, fiscal insolvency, and a growing distrust of markets are just a few of the difficulties.

Have No Doubt, Markets Depend on the Fed

Mohamed A. El-Erian | Posted 11.18.2013 | Business
Mohamed A. El-Erian

This week should remove any doubt about whether markets are highly dependent on the Fed. They sure are. Indeed, you could not have constructed better conditions for a controlled experiment. Yet, ironically, the medium-term investment stakes are now higher.

El-Erian: Fed Moves Will Affect Global Growth

Nathan Gardels | Posted 11.16.2013 | World
Nathan Gardels

Mohamed El-Erian is the CEO of the investment firm PIMCO, the world's largest bond investor. I talked to him last week about the likelihood that the U.S. Federal Reserve will soon begin tapering its asset purchases.

Emerging Markets Sell-Off: What's Next?

Otaviano Canuto | Posted 10.28.2013 | World
Otaviano Canuto

The last weeks of summer have been marked by renewed pressure of capital outflows and exchange rate devaluations in several systemically relevant emerging markets. This is just the latest round of a global portfolio rebalancing that has been in motion since May 22.

Tiptoeing Through the Tulips

Michael Farr | Posted 08.01.2013 | Business
Michael Farr

The next few weeks are critical in determining whether or not the economy is on a self-sustaining path.

There's Something About Larry (Summers)

Seriously Skewed | Posted 10.01.2013 | Comedy
Seriously Skewed

Little about Washington surprises me, but one thing I could not figure out is why President Obama wants Larry Summers as Fed Chair when Summers is the worst possible candidate for the job, except maybe for Alan Greenspan?

Financial Inclusion and The Digital Asset Transfer Authority (DATA)

Stan Stalnaker | Posted 09.28.2013 | Technology
Stan Stalnaker

On a planet rapidly coming online through mobile technologies, there's an urgent need to develop financial empowerment. Today, leaders from the emerging payment and virtual currency industry announced a Committee for the Establishment of the Digital Asset Transfer Authority.