interest rates

In order to understand much of what is happening in China it is important to understand how financial systems operate under condition of financial repression. Because most of what we know about economics is derived from economists whose…

Yesterday, the FOMC decided to reduce the pace of its large scale asset purchase program from $85 billion per month to $75 billion per month. The Fed has long wanted to taper its LSAP program and move to forward guidance to normalize policy…

The big policy and market issue today is Federal Reserve policy. There is widespread interest in today’s FOMC meeting because of the possibility that the Fed could taper the pace of its large scale asset purchase program. But why is there…

This column argues that the legacy of public debt resulting from the crisis in the Eurozone is a serious threat. Both the size of the problem and the options to address it make life much more difficult for policymakers than was the case in…

Responding to press conference questions, ECB President Mario Draghi has said the ECB is ‘technically ready’ to bring interest rates below zero. WHat do negative interest rates do? The explanation is here.

The latest flow of funds data from the US Federal Reserve show that the great American household deleveraging may be over. This should add a credit accelerator to the US economy which maintains growth. Meanwhile analysts are increasingly…

Banks pay next to nothing on deposits while charging a rate that is often linked to treasuries on the loans they make. The steeper the curve, the wider the "margin". And given the leverage inherent in the banking system, even a small margin…

Today is the day when the much anticipated jobs report was released. And the data were good. The jobs report was not the big news in my view, however, because at the same time we saw the jobs numbers we also got personal income numbers -…

Below is a speech by Philadelphia Federal Reserve President Charles Plosser recommended a more circumscribed role for the Fed.

The latest quarterly figures for Germany have come out and they show an improving domestic demand trend in Germany. Net trade lowered economic growth because of weak export volume. These results and the institution of a minimum wage will…