How to benefit from others’ QE — Hong Kong Linked Exchange Rate’s lesson
What if I tell you, behind the boring news headline, there is actually a wonkish story about how the Hong Kong central bank took advantage of the monetary easing by the Fed in the last 12 year and created a new set of policy options that it can now use to actively mange the inflows created by the new round Fed easing under the Great Lockdown.
“The Rate of Return on Everything, 1870-2015”
How Alan Taylor, one of the authors of "The Rate of Return on Everything, 1870-2015" explains the liquidity premium problem when we compare the rate of return on Housing and Equity
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.
Bank Equity and Banking Crises
In a recent study "Bank Equity and Banking Crises" by Matthew Baron (of Cornell University), Emil Verner (MIT Sloan), and Wei Xiong (Princeton University), the three economists developed a comprehensive database of bank equity prices and banking crises with a full-sample of 46 countries from 1870-2016. They try to understand the dynamic between bank equity decline and banking crises.
Understanding the Great Recession | Interviews with Larry Christiano |
Larry Christiano, one of the most prominent researcher on DSGE model, explains what his research "Understanding the Great Recession" tell us about the Great Recession as well as labor participation rate's role in the developments of the Great Recession.
A skeptical review of the QEs – why they might not be powerful as...
In their working paper "A Skeptical View of the Impact of the Fed's Balance Sheet," economists David Greenlaw, James D. Hamilton, Ethan Harris, and Kenneth D. West challenge some earlier studies that concluded QEs have a significant economic impact. Their major argument is that those research used simple event studies to quantify the impact of QE.
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.
Early signs of inflation expectation de-anchoring back in 2021
Ricardo Reis, economics professor at the London School of Economics, explained that there were telling signs that the increase in cost of living started ealry-2021 was not a "transitory" phenomenon.
Debt Growth Rate, not Level, Predicts Slowdown
Last week, Bank of England's Deputy Governor for Monetary Policy Ben Broadbent gave an insightful speech about debt dynamics.
An important point Broadbent has...
Bank of Canada Watch
The Bank of Canada on Wednesday decided to hold policy rate at 2.25% unchanged, as expected by markets. However, what is a notable is the Bank continues to show dovish bias given the recent rebound in economic data.
