Category Archives: Federal Reserve

Stephen Roach: The case against Bernanke

Submitted by Edward Harrison of Credit Writedowns. While most economists have come out in favor of Barack Obama’s decision to re-appoint Ben Bernanke as Chairman of the Federal Reserve Board, Stephen Roach has penned an Op-Ed in today’s Financial Times which highlights the case against Bernanke. It is must reading. Roach has three main points. […]

Guest Post: When At First You Don’t Succeed, Bring In the Reserves

Served by Jesse of Le Café Américain Someone asked why Bernanke seemed so positive about the US recovery, and what he would do if his prediction turned out to be incorrect. The first answer is rather straightforward. He is ‘jawboning’ or trying to increase confidence in the system to motivate businesses to spend and consumers […]

Quelle Surprise! Banking Industry Faring Worse Than Stress Test Assumptions

This blog is a card carrying hater of the stress test farce of earlier this year, The Treasury said from the start that the purpose of the stress tests was to restore confidence and show that the 19 banks tested, which hold 70% of the nation’s deposits, were well capitalized, and then said more or […]

New York Times Joins Bernanke Fan Club

Edmund L. Andrews in the New York Times today depicts Federal Reserve chairman Ben Bernanke as badly treated by his critics. The article verges on hagiography: As central bankers and economists from around the world gather on Thursday for the Fed’s annual retreat in Jackson Hole, Wyo., most are likely to welcome Mr. Bernanke as […]

"Monetizing the Debt: Disinformation in the Blogosphere"

Via e-mail, I received Tyler Durden’s post on supposed Fed stealth monetization of debt via an allegedly stealth repurchase of a big chunk of the Treasury’s latest 7 year bond issue on the Fed’s open market desk. Full disclosure: Tyler Durden has been a guest blogger here, I think he often does a very good […]

Run for the Hills: Fed Plans to Build on Sham Stress Tests as Basis for Regulation

As readers may recall, we and just about anyone who understood anything about financial firm supervision saw the stress tests as a complete and utter farce. The authorities had tea and cookies with the 19 banks and then talked about model outputs. The talks sometimes got heated, so were were supposed to take this as […]

Geithner Bullies Financial Regulators to Accept Fed as Top Dog

The Wall Street Journal reports that Timothy Geithner tongue-lashed Federal financial services regulators over their bucking the Obama Administration initiative for the Fed to become The One Regulator to Rule Them All. This comes on the heels of Congressional testimony which showed rather clearly that the key actors were not singing from the same hymnal. […]

Government Taken in Dealings with Wall Street: Accident or Design?

We’ve grumbled at points during the process of throwing various lifelines out to the financial sector, that media has tended to focus unduly on the TARP (no doubt encouraged by the powers that be who are eagerly pushing “the banks are fine” line) at the expense of the vast net of additional subsidies. The ones […]

Did Federal Reserve Remove Some Embarrassing Bernanke Testimony?

Readers, I will confess I am only a user of garden variety search tools, with no special training, merely years of trial and error. I am having to do a quite a bit of rooting around these days to track down support for various arguments I am putting together for the book. I decided to […]

Guest Post: Representative Alan Grayson on His Questions to Bernanke Over Dollar Swap Lines

From Congressman Alan Grayson, member of the House Financial Services Committee and representative to the 8th Congressional District of Florida: Hi, Alan Grayson here. I just questioned Ben Bernanke in a Financial Services Committee hearing over the Federal Reserveís use of swap lines. You can watch the clip here. There was some good discussion on […]

Bernanke outlines Fed’s easy money exit strategy

Submitted by Edward Harrison of Credit Writedowns. Over the past week, America’s banks have had a bumper earning season, in part courtesy of the Federal Reserve’s accommodative monetary policy. Even before this week, a number of market pundits (including me) began to wonder aloud whether the Fed had any strategy with which to remove all […]

Alan Grayson: "Where is the half a trillion dollars the Federal Reserve lent to foreigners?"

I found this exchange intriguing. First, the unflappable Bernanke looks stressed. I can’t put my finger on why, but the Congressional attacks seem to be getting to him. Second is the stunning lack of candor as to why the dollar swap lines were put in place, that there was massive dollar deleveraging happening. It would […]

Denninger Savages WaPo Defense of Goldman

It simply amazes me that those who are cheerleading the seeming return of Wall Street to health overlook the extensive, hydra-headed subsidies they’ve received and continue to receive. The media has bought and is touting the line, “Hey, they (more accurately some) paid back the TARP, so what’s the beef?” Let us consider the other […]

Quelle Surprise! The Fed is Reporting Losses on Its Bear Stearns and AIG SPVs

Readers may recall that during the heat of bailout battle, the Federal Reserve got into the fancy finance business, relying on the sort of deal structuring sometimes used to try to turn toxic odd pork scraps into barely-digestible sausage, the procedure used for pigs so dead that merely putting lipstick on them just won’t do. […]

Guest Post: Richard Alford on Target Fixation and the Fed as Systemic Regulator

Submitted by Richard Alford, a former economist at the New York Fed. Since them, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side. TARGET FIXATION AND THE FED AS THE SYSTEMIC REGULATOR Target fixation is a process by which the brain […]