Nonbank Lending
In their recent working paper "Nonbank Lending", economists Sergey Chernenko, Isil Erel, and Robert Prilmeier provided an insightful overview of the sources and terms of private debt financing during the post-crisis period.
What is Payment on Reserves Process?
The payment on reserve process proposed by Robert Hall and Ricardo Reis is a way of remunerating reserves which would give the central bank better control over the price level.The basic intuition is that...
FedSpeak Might Not Have Much Effects on Public’s Inflation Expectation
In a recent NBER working paper "Monetary Policy Communications and their Effects on Household Inflation Expectations", economists Olivier Coibion, Yuriy Gorodnichenko and Michael Weber tried to find out how the household's expectation for inflation change with regard to the information they received.
Central Bank’s Balance Sheet and the Rise of Reserves
The above figure shows the balance sheet of four major central banks from 2005 to 2015. Above the horizontal axis is the asset side of the balance sheet, below is the liability side. All...
The problem with monetarist’s view of inflation
Long-run stability of the velocity, or the filpside of it, money demand, however, is not a empirically founded assumption.
What Macroeconomists agree with each others, according to Blanchard
Olivier Blanchard a list of things that macroeconomists normally agreed on and need no further discussions.
CoCo issuance and bank fragility
A series of papers by Stefan Avdjiev, Bilyana Bogdanova, Patrick Bolton, Wei Jiang, and Anastasia Kartasheva on this topic is highly recommended.
Macroprudential Policy – how does it differ from rate hikes?
Macroprudential policies, it is argued, are more targeted and can complement central bank’s use of interest rate policy.
How often companies in Eurozone change their prices?
An ECB survey found that the retailers review and change their prices most often, while consumer and business service firms adjust their pricing the least often. Firms in the manufacturing sector, meanwhile, have a price adjustment frequency somewhere in between the above sectors
Why Negative Rate is a better policy tool to Higher Inflation Target? Bernanke Explains…
In his latest Brookings blog post "Modifying the Fed’s policy framework: Does a higher inflation target beat negative interest rates?", Ben Bernanke compares two policy tools central banks can use to stimulate the economy...