monetary policy

This morning in an e-mail exchange with Marshall Auerback, I questioned why the U.S. Dollar was rising so precipitously. I do understand much of this has to do with a need to refinance dollar-denominated borrowing by international…

The Federal Reserve and its fellow central banks are pulling out all the stops to make sure the panic phase of this crisis is well and truly over. These kinds of moves are already having results as Libor and Euribor (the rate at whch banks…

The United States had been living beyond its means for a very long time before the credit crisis finally hit. The truth of the matter is that U.S. monetary and fiscal policy rewarded risk-taking and leverage at the expense of prudence and…

Inflation was unchanged from the previous month in September, bringing the annual rate of inflation down to 4.9%. While the inflation rate is still elevated, the drop in oil and commodity prices combined with lower consumer spending is…

In July, I made my ten predictions for the markets and global economy for the rest of the year. Some of my predictions were pretty pedestrians, and some were fairly bold. Let's take a look and see how I'm doing.Here's what I originally…

The Federal Reserve, the Bank of England and the European Central Bank led a coordinated rate cut effort as the official response to the biggest financial crisis since the Great Depression gathers steam. The official response in Europe and…

Richard Fisher of the Dallas Fed shows that some of the Fed Presidents get it. He is now on record for saying that interest rate cuts won't solve America's credit crisis problems. In fact, interest rate cuts will make them much worse. If…

Whenever I wade into a new topic like digital photography, gardening or what have you, I visit the local bookstore and get a "For Dummies" book to guide me. I figure that it's the best way to get up-to-speed quickly without…

FT Alphaville has two posts today that mirror my view on the Lehman Brothers bankruptcy. They basically say it was a huge mistake to let Lehman fail. Lehman was, in fact, too big to fail and the blow up in the markets since its failure…

The meltdown of the world's largest insurer AIG (AIG) makes the stakes of this credit crisis plain to all. In my view, the AIG situation and the subsequent turmoil in financial markets could have been avoided. The markets were clearly on…