China lends to the rest of the world because it saves much more than it needs to fund its high level of physical investment spending.
May 9, 2016
May 6, 2016
Historical Echoes: Echoes, Schmechoes, This Post Only Has a Drop of History in It
You might hear: “Economy eschmonomy.” Another possibility is: “Economy schmeconomy.” This phenomenon of repeating a word with the prefix shm- (or sometimes “schm-“), is called shm-reduplication. It challenges the relevance and sometimes the value of the repeated word, and examples can be found in articles like this Newsday clip “The High End: Economy, shmeconomy — the rich still travel.”
May 5, 2016
Borrowing, Lending, and Swapping Collateral in GCF Repo®
By Marco Cipriani and Adam Copeland In the third post in this series, we examined GCF Repo® traders’ end-of-day strategies. In this final post, we further our understanding of dealers’ behavior by looking at their trading pattern within the day.
May 4, 2016
Why Dealers Trade in GCF Repo®
Analysis using confidential market data shows that the majority of individual dealers follow consistent strategies in GCF Repo, where dealers are net borrowers or lenders on almost every day that they are active.
May 3, 2016
Understanding the Interbank GCF Repo® Market
In this post, we provide a different perspective on the General Collateral Finance (GCF) Repo® market.
May 2, 2016
What’s Up with GCF Repo®?
In a recent Important Notice, the Fixed Income Clearing Corporation (FICC) announced that it would no longer support interbank trading for its General Collateral Finance Repo Service.
Lower Oil Prices and U.S. Economic Activity
After a period of stability, oil prices started to decline in mid-2015, and this downward trend continued into early 2016.
Posted at 7:00 am in Exports, Financial Markets, International Economics, Macroeconomics | Permalink
April 18, 2016
What’s behind the March Spike in Treasury Fails?
Michael J. Fleming and Frank M. Keane U.S. Treasury security settlement fails—whereby market participants are unable to make delivery of securities to complete transactions—spiked in March 2016 to their highest level since the financial crisis. As noted in this post, fails delay the settlement of transactions and can therefore lead to illiquidity, create operational risk, […]
April 15, 2016
Just Released: The New York Fed Staff Forecast—April 2016
Today, the Federal Reserve Bank of New York (FRBNY) is hosting the spring meeting of its Economic Advisory Panel (EAP). As has become the custom at this meeting, the FRBNY staff is presenting its forecast for U.S. growth, inflation, and the unemployment rate. Following the presentation, members of the EAP, which consists of leading economists in academia and the private sector, are asked to critique the staff forecast. Such feedback helps the staff evaluate the assumptions and reasoning underlying its forecast as well as the forecast’s key risks. The feedback is also an important part of the forecasting process because it informs the staff’s discussions with New York Fed President William Dudley about economic conditions. In that same spirit, we are sharing a short summary of the staff forecast in this post; for more detail, see the FRBNY Staff Outlook Presentation from the EAP meeting on our website.
April 14, 2016
A Peek behind the Curtain of Bank Supervision
Since the financial crisis, bank regulatory and supervisory policies have changed dramatically both in the United States (Dodd-Frank Wall Street Reform and Consumer Protection Act) and abroad (Third Basel Accord).
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