Posts Tagged ‘ Federal Reserve ’

The Fed can’t raise rates, but must pretend it will

October 26, 2015
posted by

Ludwig von Mises Institute Ludwig von Mises Institute
by Thorsten Polleit  

"Waiting for Godot is a play written by the Irish novelist Samuel B. Beckett in the late 1940s in which two characters, Vladimir and Estragon, keep waiting endlessly and in vain for the coming of someone named Godot. The storyline bears some resemblance to the Federal Reserve's talk about raising interest rates." (10/26/15)

https://mises.org/library/fed-can%E2%80%99t-raise-rates-must-pretend-it-will  

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More really good news

October 16, 2015
posted by

Scott Sumner EconLog
by Scott Sumner  

"I recently pointed out that Fed officials are becoming more receptive to the market monetarist proposal for negative interest on reserves. Today there is more progress, on an even more important front. First let me provide a bit of background information. Back in late 2008 and early 2009 I argued that monetary policy was extremely tight, despite low interest rates. Most people scoffed at that claim, they'd say, 'everyone knows monetary policy is highly accommodative.' A new press report (sent to me by Michael Jurka) suggests that even the Fed is coming around to the market monetarist view that low interest rates don't mean easy money ..." (10/15/15)

http://econlog.econlib.org/archives/2015/10/more_really_goo.html  

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The pitfalls of the Federal Reserve’s zero interest rate policy

October 16, 2015
posted by

Cato Institute Cato Institute
by James A Dorn  

"The Federal Reserve has kept its target range for the federal funds rate at 0 to 0.25 percent since December 2008. This is often referred to as the Fed's 'zero interest rate policy,' or ZIRP. The purpose of near-zero overnight rates -- and forward guidance to convince markets that those rates will be maintained -- has been to affect the entire rate structure: keeping all rates lower than they would have been in a free capital market." (10/15/15)

http://bit.ly/1Kcu7Yq  

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Market monetarism continues to make progress

October 13, 2015
posted by

Scott Sumner EconLog
by Scott Sumner  

"In early October 2009, the Fed first adopted a positive interest rate on reserves, and then raised it twice in November. Just imagine that instead the Fed had cut IOR to negative 0.75% in their September 16, 2008 meeting, two days after Lehman failed. (At the time the fed funds target was positive 2%.) Perhaps TARP would not have even been necessary. Now the Fed needs to reconsider their views on level targeting, which is even more powerful than negative IOR during a recession. And then NGDP level targeting." (10/12/15)

http://econlog.econlib.org/archives/2015/10/market_monetari_2.html  

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Ben Bernanke and the art of central banking

October 12, 2015
posted by

Cato Institute Cato Institute
by George Selgin  

"Like any experienced Fed chairman, Ben Bernanke knows how to choose his words carefully. So the triumphalist headline, 'How the Fed Saved the Economy,' assigned to his Oct. 4 Wall Street Journal column, probably wasn't his doing. Still the question remains: did the Fed really save us? Bernanke suggests that it did. But the evidence he musters leaves plenty of room for doubt." (10/09/15)

http://bit.ly/1hy833y  

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Time to end monetary central planning

October 6, 2015
posted by

Richard M. Ebeling Future of Freedom Foundation
by Richard M Ebeling  

"There is no way to describe current Federal Reserve policy other than as monetary confusion and misdirection. In a nutshell, Janet Yellen and the other members of the Fed’s Board of Governors have no idea what to do. Do they raise certain interest rates over which they have some direct influence? Do they keep them at their current rock bottom levels, as they have for the last six years?" (10/06/15)

http://bit.ly/1jMobAa  

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Welcome to the banana republic

October 6, 2015
posted by

Liberty Blitzkrieg Liberty Blitzkrieg
by Michael Krieger  

"There's nothing like the comment section when it comes to Federal Reserve propaganda in the editorial pages of the Wall Street Journal. Liberty Blitzkrieg readers will remember the last time the WSJ published a disconnected piece of Central Bank stroking garbage from Fed propagandist John Hilsenrath, and the riotous anger which ensued in the comment section. ... Fast forward a few months, and here we have Ben 'the courage to bail out billionaires' Bernanke writing an almost unreadable piece of propaganda in the WSJ titled 'How the Fed Saved the Economy.'" (10/05/15)

http://bit.ly/1j9suph  

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When the Fed ignores the market

October 4, 2015
posted by

Scott Sumner EconLog
by Scott Sumner  

"Market forecasts are often wrong. But they remain the least bad way we have of predicting the future. In the past, we've paid a heavy price when the Fed ignored market forecasts. In September 2008, the TIPS markets predicted very low inflation while the Fed predicted very high inflation. The Fed refused to ease money policy and we paid a heavy price when it turned out the markets were correct." (10/03/15)

http://econlog.econlib.org/archives/2015/10/when_the_fed_ig.html  

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Dammit, Janet

October 1, 2015
posted by

The Cobden Centre
by Tim Price  

"According to Einstein, time is affected by gravity. Clocks far from strong gravitational fields run more quickly; those close by run more slowly. We can only assume, then, that Janet Yellen has the density of a neutron star. Under her leadership of the US Federal Reserve, time seems to have stopped altogether." (10/01/15)

http://www.cobdencentre.org/2015/10/dammit-janet/  

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Low interest rates cannot perpetuate a house of cards

September 22, 2015
posted by

Richard M. Ebeling The Daily Bell
by Richard M Ebeling  

"When is the price of some marketable good or service at or near zero? When either the supply of it is so plentiful that virtually any demand, no matter how great, can be satisfied or when no matter how large or small the supply of it may be, people's demand for it is so low that nobody is willing to practically pay anything for it. On Thursday, September 17, 2015, Federal Reserve Chair Janet Yellen announced that, once again, America's central bank was leaving a key interest rate -- the Federal Funds rate at which banks lend money to each other overnight -- at barely above zero." (09/22/15)

http://tinyurl.com/q8gnmvb  

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Markets will rule in the long run

September 17, 2015
posted by

James A Dorn Cato Institute
by James A Dorn  

"Slow economic growth reflects slow productivity growth due to structural/institutional problems, not slow money growth. The current low inflation diverts attention from the damaging effects of the Fed’s unconventional monetary policy. Moreover, policymakers continue to confuse low interest rates with easy money and to think that lower rates produce a permanent wealth effect. The truth is the Fed's 'wealth effect' is a pseudo wealth effect: Once interest rates return to normal, asset prices will fall and wealth disappear. Although the Fed can influence interest rates in the short run, markets will rule in the long run." (09/16/15)

http://www.cato.org/publications/commentary/markets-will-rule-long-run  

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Jackson Hole: Cherry flavored cyanide, or strawberry

September 8, 2015
posted by

The Cobden Centre
by Keith Weiner  

"In the real gold standard, if you don't like the interest rate or banking risk then you sell a bond or withdraw your gold coin. This forces the interest rate up. The time preference of the people has real teeth. However under the dollar, what can you do? At least a bond pays something. If you sell it, then you get cash which pays nothing. Savers are disenfranchised. No wonder interest has been falling for three decades. The debate of a Fed managed dollar based on unemployment and CPI, vs. a Fed managed dollar based on the gold price is a false alternative." (09/08/15)

http://tinyurl.com/njfu2db  

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If the Fed is always wrong how can its policies ever be right?

September 1, 2015
posted by

The Cobden Centre
by Ralph Benko  

"If the Fed is making policy based on consistently wrong predictions how good can its policy consistently be? If its forecasts consistently are wrong -- as now is undeniable -- on what is it basing policy? Guesswork (more pretentiously phrased as 'discretion')?" (08/31/15)

http://tinyurl.com/napz2s7  

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The central bankers’ malodorous war on savers

August 30, 2015
posted by

David Stockman LewRockwell.com
by David Stockman  

"Relative to wage and salary income, the exhaustion of the Greenspan-Bernanke parlor trick is plain as day. Debt soared from 80% of wage and salary incomes in the 1970s, where it had traditionally been associated with healthy household finance, to 220% of wage and salary incomes by the eve of the financial crisis. But since then it has rolled over and has therefore been a depressant to growth, not a stimulant." (08/29/15)

http://tinyurl.com/nppptsm  

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Keeping the bubble-boom going

August 25, 2015
posted by

The Cobden Centre
by Thorsten Polleit  

"The US Federal Reserve is playing with the idea of raising interest rates, possibly as early as September this year. After a six-year period of virtually zero interest rates, a ramping up of borrowing costs will certainly have tremendous consequences. It will be like taking away the punch bowl on which all the party fun rests." (08/25/15)

http://www.cobdencentre.org/2015/08/keeping-the-bubble-boom-going/  

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Debt collapse: The decline and fall of the United States of America

August 25, 2015
posted by

OpEdNews
by William Edstrom  

"There's going to be a collapse in the United States of America. Again. This collapse around, there's nothing the United States (US) government can do to 'rescue' the US economy because the Federal Reserve Bank's interest rate is 0%. They cannot lower interest rates. The only thing the US government can do is print more money. Printing too much money causes hyper-inflation which in turn causes things worse than hyper-inflation." (08/25/15)

http://tinyurl.com/pzrm8sh  

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Trumping the federal debt without playing the default card

August 19, 2015
posted by

CounterPunch CounterPunch
by Ellen Brown  

"The vast majority of the money supply today is created by banks when they make loans, as the Bank of England recently acknowledged. Banks create money by 'monetizing' debt, turning loans into the digital deposits that make up most of the circulating money supply. The government could push the reset button by monetizing its own debt, turning it into what it should have been all along -- debt-free, interest-free dollars." (08/19/15)

http://tinyurl.com/py6gz96  

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Markets, not Janet Yellen, should set interest rates

August 19, 2015
posted by

Richard M. Ebeling National Center for Policy Analysis
by Richard M Ebeling  

"The Federal Reserve (Fed) influences interest rates by purchasing U.S. government securities in the secondary market with newly created money. This capital flows into the system when the original holders of these securities deposit the payments into their bank accounts, says Dr. Richard Ebeling, distinguished professor of ethics and free enterprise leadership at The Citadel in Charleston, South Carolina." (08/19/15)

http://www.ncpa.org/sub/dpd/index.php?Article_ID=25971  

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Four steps to help bring down the Federal Reserve

August 17, 2015
posted by

TJ Martinell Tenth Amendment Center
by TJ Martinell  

"Since its the founding of the U.S. central bank known as the Federal Reserve, the dollar has lost an incredible amount of value in terms of purchasing power. An item worth $1 in 1913 costs $24.1 today. This is a direct result of the Fed because its actions debase the currency. That simply means the average American has less purchasing power. For example, following the 2008 economic collapse, the Fed has engaged in a multiple rounds of 'quantitative easing.' In plain speak, they are simply printing more money. Central bank monetary policy perpetuates booms and busts, and we can directly trace recent economic crises to government monetary policy facilitated by the Federal Reserve. The good news is that we can take steps, both at an individual and state level, to undermine and potentially nullify the Federal Reserve, no matter what political party controls the White House and Congress." (08/17/15)

http://tinyurl.com/o9xu6sg  

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Yellen sees first Fed rate hike later this year

July 16, 2015
posted by

Los Angeles Times Los Angeles Times    

"Unfazed by recent global turmoil, Federal Reserve Chair Janet L. Yellen is offering a fairly optimistic outlook for the U.S. economy and reaffirming that the central bank is likely to begin raising interest rates later this year. ... As long as the economy continues to progress along those expectations, Yellen said, the Fed is likely this year to raise its benchmark interest rate for the first time since 2006. She mentioned the problems in Greece and the uncertainties in China, but noted that global economic growth could pick up more quickly than many are expecting. The Fed's so-called federal funds rate, which influences business and consumer borrowing costs, has been pinned near zero since the depths of the Great Recession in late 2008." (07/15/15)

http://tinyurl.com/ntlzgsq  

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IMF encourages Fed to delay rate increase

June 4, 2015
posted by

Salt Lake Tribune    

"The International Monetary Fund on Thursday urged the Federal Reserve to put off raising short-term interest rates until next year because the U.S. economy still needs help. In its yearly check-up of the United States, the IMF predicted the American economy would grow just 2.5 percent this year, down from its April forecast of 3.1 percent. The downgrade reflects the economy's stumbling start to the year: Gross domestic product fell the first three months of 2015, tripped up by harsh winter weather and the export-killing strength of the dollar. The IMF has no direct influence over U.S. economic policy. But the global lending agency is widely respected for its technical expertise on economics and finance." (06/04/15)

http://tinyurl.com/obckeb2  

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Janet Yellen is right: She can’t predict the future

May 27, 2015
posted by

Ron Paul The Daily Bell
by Ron Paul  

"This week I found myself in rare agreement with Janet Yellen when she admitted that her economic predictions are likely to be wrong. Sadly, Yellen did not follow up her admission by handing in her resignation and joining efforts to end the Fed. An honest examination of the Federal Reserve's record over the past seven years clearly shows that the American people would be better off without it." (05/25/15)

http://bit.ly/1Rkj0mE  

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US monetary policy: A ship with a broken rudder

May 27, 2015
posted by

Cato Institute Cato Institute
by George Selgin  

"In light of some bad economic news, the Federal Open Market Committee's decision to continue its accommodative policy stance may come as relief to some. But it's no cause for celebration. Indeed, it only underscores the fact that our monetary system is still not functioning properly. If it were, the Federal Reserve's $4.5 trillion balance sheet would long ago have translated into healthy, if not inflationary, levels of spending." (05/26/15)

http://bit.ly/1FB8qCh  

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St. Louis Fed hit with hack

May 20, 2015
posted by

CNN Money    

"Visitors to parts of the St. Louis Federal Reserve's website last month were sent to phony sites that could be used to steal their personal information. The hack targeted the St. Louis Fed's Web servers -- not the Fed branch itself or its website. This kind of 'domain name server hack' sends a person to a different site, often laced with malware or phishing software." (05/19/15)

http://money.cnn.com/2015/05/19/technology/st-louis-fed-hack/  

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In 1987, the Fed prevented another Great Depression by doing nothing

May 4, 2015
posted by

Scott Sumner EconLog
by Scott Sumner  

"American liberals argue that institutions like the Fed rescue the economy from a deeply unstable capitalist system. Libertarians are skeptical of the activism and worry that it just stores up more trouble for the future. But what if they are both wrong? What if the Fed rescues the economy by doing nothing?" (05/04/15)

http://econlog.econlib.org/archives/2015/05/in_1987_the_fed.html  

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