Perry Mehrling: A Turbulent Exit, as the Fed Achieves “Lift-off”?
Turbulence if and when the Fed raises rates, and from an unexpected source.
Read more...Category Archives: Federal Reserve
Perry Mehrling: No One Has a Good Idea of How to Keep the Fed From Having to Rescue Mr. Market Again
Perry Mehrling’s post on the Fed’s progress in dealing with future market crises is damning, despite its “give everyone credit for what they have done” recap.
Read more...Perry Mehrling: The Fuss about Market Liquidity
I am SO glad to see this post appear. It’s annoying to see investors and banksters whine that they want more liquidity, as if that were a right.
Read more...“@ Hillary Clinton: How does your student loan debt make you feel? Tell us in 3 emojis or less.”
The above tweet is real and is from Hillary Clinton’s official twitter account. It is very difficult to express how appalling this sentiment is. It represents much of what’s wrong with American politics in our current moment.
Read more...The Decline in Market Liquidity
While the Fed isn’t worried about the fall in market liquidity, experts argue that if investors make abrupt changes in their portfolios, the lack of liquidity could produce a crisis.
Read more...Testing the Global Central Bank Swap Network
Central bank swaps are in some ways quite similar to a standard commercial FX swap, but the differences are important and significant.
Read more...The Yellen Subsidy: Fed Chair Pumps for Keeping Financiers Fat Over Filling Potholes
Yellen tries conning journalists and the Great Unwashed Public in her defense of preserving the current level of Fed dividends to banks.
Read more...Mario Draghi: The ECB Has No Mandate To Ensure Checks Clear Or Credit Cards Work
By Nathan Tankus, a writer from New York City. Follow him on Twitter at @NathanTankus Last week Mario Draghi held a press conference following the decision to raise ELA a paltry 900 million dollars for Greek banks. In that press conference he said many things but I’d like to focus on one passage that has gotten […]
Read more...Banks are Not Intermediaries of Loanable Funds – and Why This Matters
Problems in the banking sector played a seriously damaging role in the Great Recession. In fact, they continue to. Macroeconomic models failed to explain the interaction between banks and the macro economy. The problem lies with thinking that banks create loans out of existing resources. Instead, they create new money in the form of loans. The traditional model greatly understates bank and macroeconomic risk.
Read more...Unresolved Allegations of Criminal Insider Trading Leaks from the Fed
A segment on yesterday’s Boom/Bust program discusses the still-open inspector general criminal investigation into leaks from the Fed.
Read more...AIG Bailout Trial Judge Rebukes Fed for Overstepping Its Powers but Awards No Damages
The long-anticipated verdict in the AIG bailout trial came yesterday, and the Fed is not happy.
Read more...Ilargi: QE Breeds Instability
Why both Keynes and Minsky regarded low interest rates as poor policy.
Read more...Wolf Richter: When Betting on QE Suddenly Goes Wrong
Central banks think they’re omnipotent – until they aren’t.
Read more...The Fed’s Dereliction of Duty and False Capital Flows Morality
The Fed disavows responsibility for the way US interest rate policy sends money sloshing around the world. It’s a huge mistake intellectually and politically.
Read more...Ilargi: Mario Draghi’s Slippery Downward Slope
Mario Draghi is more and more visibly meddling in politics, yet another reminder that central bank “independence” is a fig leaf.
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