In our earlier post, we described how the tri-party repo arrangement was a clever way to reduce the costs and risks that individual firms faced when settling bilateral repos.
May 13, 2015
May 12, 2015
Just Released: Mortgage Borrowing among Most Creditworthy Abates
Today’s release of the New York Fed’s Quarterly Report on Household Debt and Credit for the first quarter of 2015 reports a flattening in household debt balances.
May 11, 2015
Financial Innovation: The Origins of the Tri‑Party Repo Market
The conventional wisdom about financial innovation is that it is typically undertaken as a way to increase profits.
May 8, 2015
Crisis Chronicles: The Man on the Twenty‑Dollar Bill and the Panic of 1837
Thomas Klitgaard and James Narron Correction: This post was updated on May 8 to correct the book title and spelling of the author’s name in the fifth paragraph. We regret the error. President Andrew Jackson was a “hard money” man. He saw specie—that is, gold and silver—as real money, and considered paper money a suspicious […]
May 7, 2015
From the Vault: Monetary Policy and Government Finances
Anna Snider Each year, the manager of the Federal Reserve’s System Open Market Account (SOMA) submits an accounting of open market operations and other developments influencing the composition and performance of the Fed’s balance sheet to the Federal Open Market Committee (FOMC).
Posted at 7:00 am in Fiscal Policy | Permalink
May 6, 2015
U.S. Potential Economic Growth: Is It Improving with Age?
Samuel Kapon and Joseph Tracy The contribution of labor input to the potential GDP growth rate for the United States has changed over time. We decompose this contribution into two components: the size of the adult population and the average demographically adjusted employment rate. We find that these two components in the late 1960s and […]
May 4, 2015
Interest‑Bearing Securities When Interest Rates are Below Zero
Negative interest rates have evolved, over the past few years, from a topic of modest academic interest to a practical reality.
April 20, 2015
Credit Supply and the Housing Boom
There is no consensus among economists as to what drove the rise of U.S. house prices and household debt in the period leading up to the recent financial crisis. In this post, we argue that the fundamental factor behind that boom was an increase in the supply of mortgage credit, which was brought about by securitization and shadow banking, along with a surge in capital inflows from abroad. This argument is based on the interpretation of four macroeconomic developments between 2000 and 2006 provided by a general equilibrium model of housing and credit.
April 17, 2015
At the New York Fed: Chapter 9 and Alternatives for Distressed Municipalities and States
On Tuesday, April 14, the Federal Reserve Bank of New York hosted an all-day workshop entitled Chapter 9 and Alternatives for Distressed Municipalities and States. The workshop was jointly organized and sponsored by the Volcker Alliance and George Mason University’s State and Local Government Leadership Center. The event brought together key experts, practitioners, and researchers on the subject of fiscal distress at the state and local level. The aim of the session was to foster discussion on the role of Chapter 9 of the U.S. Bankruptcy Code, alternatives for distressed governments, and strategies to avoid stress and achieve good fiscal outcomes.
April 16, 2015
Just Released: Press Briefing on Student Loan Borrowing and Repayment Trends, 2015
This morning, Jamie McAndrews, the Director of Research at the Federal Reserve Bank of New York, spoke to the press about the economic recovery, and his speech was followed by a special briefing by New York Fed economists on student loans. Here, we provide a short summary of the student loan briefing.
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