monetary policy

Who says the ECB can't keep up with the Fed. As the euro crisis has caused liquidity for euro zone banks to dry up, the ECB has taken on the intermediation role. In essence, they have taken on the dollar liquidity function that the US money…

Listen: they can go kicking and screaming all they want to but, unless they’re on board to with ending the euro, it seems likely that the rich nations in Northern Europe will end up bailing out their poorer brethren. Whether they call it a…

To it’s credit, the ECB has been pretty good on the liquidity front all along. I’d give it an A grade for liquidity vs the Fed where I’d give a D grade for liquidity. Back in 2008 the ECB was quick to provide unlimited euro liquidity to its…

The last post by Randall Wray below is an interesting one because it points out how the world has changed since the end of the gold standard and why the sovereign debt crisis is centered in the euro zone. While I have an Austrian bias…

Let’s see how it is really done in the US—where the Treasury really does hold accounts in both private banks and the Fed, but can write checks only on its account at the Fed. Further, the Fed is prohibited from buying Treasuries directly…

Successful Spanish and Greek bill auctions and better than expected German IFO caught the market wrong-footed, if the record net speculative short at the IMM is anything to go by. The euro has shot up to almost $1.3090 and pulled up the…

The country’s debt dynamics are far from unsustainable at this point, but given the weakening in the country’s export performance and the steady unwinding of the housing boom we can now anticipate I would expect growth to be weaker than…

I don’t think there is a whole lot to say about this week’s numbers beyond what I have been saying for the past several months. Nothing substantial has really changed. China’s external account is worsening, and will continue to worsen…

By cutting 50 bp in one swoop, the Norges Bank hopes to get ahead of the curve. This is part insurance against addition headwinds, but also responds to the recent data indicating an economic slowdown.

Congress should immediately call Chairman Bernanke in for testimony on the veracity of the Fed’s response to the Bloomberg report. It should demand a comprehensive accounting for all the Fed’s commitments, by institution that benefitted.…