Category Archives: Federal Reserve

"Quantitative easing, credit easing and enhanced credit support aren’t working; here’s why"

Dear readers, we are NOT setting out to have a Willem Buiter-fest this weekend. It’s simply that this is a slow news period and Buiter has a good post after the first video clip I’ve ever seen of him. So if there was more activity, the Buiter-density would be lower. The Anglophile Dutch economist has […]

S.F. Fed chief Yellen tells inflationistas to pipe down

Submitted by Edward Harrison of Credit Writedowns. Of late, there have been a lot of worries about he potential for inflation in the U.S. Marc Faber is the most noted pundit in this regard. Over-the-top comments he made back in May about hyperinflation in the U.S. may have been a catalyst for all of the […]

Reader Sanity Check: Interest Rate Policy, Leverage and the Financial Crisis

There are some interesting things one learns in putting together a book. Blogging is a lot like working in watercolors, speed and confidence in execution are key, versus the oil-painting medium of a book. And you learn how many times you wind up scraping the canvas and reworking. I’m up to the sixth revision of […]

Is Bernanke Toast? If he is, Summers is a shoo-in

Submitted by Edward Harrison of Credit Writedowns. Here’s a conspiracy theory for you. As I am not much of a conspiracy theorist, I ill keep this one pretty simple. Here’s the chain of events. Back in late September when the world was falling apart, Ben Bernanke, Tim Geithner and Hank Paulson were all desperate to […]

Does Ben Bernanke blow bubbles too?

Submitted by Edward Harrison of Credit Writedowns. During Alan Greenspan’s tenure at the helm of the Federal Reserve, he was often accused of using monetary policy to target asset markets so as to keep the party going. In short, Alan Greenspan was seen by many, including myself, as the bubble blower-in-chief. All of this came […]

"Timelines of Policy Responses to the Global Financial Crisis"

For information junkies and those wanting one-stop shopping on who did what to whom during the crisis, the New York Fed has just put up a crisis timeline, with domestic and international versions, at its website, which it intends to update monthly. Below is a sample (click to enlarge). It downloads as a pdf:

Geithner’s Plan to Have a Reform Plan Skewered by Senate

What amounted to a statement of principles and a very few stakes in the ground from Timothy Geithner on financial reform got a largely hostile reaction from Congress (see Ed Harrison here and here for further detail). The main criticism was that the notion of making the Fed the uber stability regulator/financial system overseer (officially, […]

A more comprehensive look at Obama’s proposed financial reforms

Submitted by Edward Harrison of Credit Writedowns. If you listen to the criticism from the right and from the left, from pro-regulation and anti-regulation pundits, you can understand the political constraints which produced the white paper which the President unveiled yesterday. Given those constraints, I consider the white paper a good effort. My initial reaction, […]

Guest post: The bezzle is shrinking

Submitted by Edward Harrison of the site Credit Writedowns. “In many ways the effect of the crash on embezzlement was more significant than on suicide. To the economist embezzlement is the most interesting of crimes. Alone among the various forms of larceny it has a time parameter. Weeks, months, or years may elapse between the […]

Guest post: Ken Lewis points the finger at Bernanke and Paulson

Submitted by Edward Harrison of the site Credit Writedowns. The drama at Bank of America continues with Ken Lewis testifying before Congress today. Most of the events surround claims by Lewis that he was coerced into doing the Merrill deal by Hank Paulson and Ben Bernanke. I chronicled these events when they were made public […]

House Subpoenas Fed Re Merrill Sale to Bank of America

The Financial Times reports that the House Oversight committee wants to have a little chat with the Fed over the widespread reports that it muscled BofA more than a tad to complete its acquisition of Merrill after the Charlotte bank learned that the securities firm had posted large losses in December and tried to exit […]

Fed Hires Former Enron Lobbyist to Burnish Its Image

This development, that the Federal Reserve has hired one Linda Robertson, former Enron lobbyist and Summers/Rubin protege, to manage relations with the Hill, strikes me as a tacit admission that the Fed thinks it has an Enron scale problem brewing…. From Bloomberg (hat tip reader Matt S): The Federal Reserve intends to hire a veteran […]

Another "Rescue the Markets" Program Flagging?

Yesterday, we highlighted yet another indication that one of two parts of the infamous Public Private Investment Partnership, the so called Legacy Loans Program, was being delayed, possibly on a permanent basis (or more likely, it will be launched eventually to save bureaucratic face and have weak to non-existent take-up). Its evil twin, the program […]

Fed Setting Higher-Than-Stress-Test Bar for Exiting From TARP

Well, once in a while the authorities exceed my low expectations, and this is one of those instances. The Fed is insisting that the bank recipients of TARP fund meet a higher standard, in terms of balance sheet strength, than set in the stress tests. The banks are grumbling that this is not what they […]

Guest post: Central banks will face a Scylla and Charybdis flation challenge for years

Submitted by Edward Harrison of the site Credit Writedowns. Nearly a month ago, back on May 5th, I highlighted some testimony by Federal Reserve Chairman Ben Bernanke before congress in a post labelled, “Bernanke expects recovery later this year". In his testimony, Bernanke used the phrase ‘Scylla and Charybdis’ to describe the Federal Reserve’s policy […]