J. Benson Durham Currency forwards do include useful information about the future value of the U.S. dollar, but any messages are hard to decipher without tools. Just as the yield curve reflects expected short rates as well as term premiums, foreign exchange forwards embed not only anticipated depreciation but also premiums for currency risk. This […]
June 25, 2014
June 23, 2014
The Capitol Since the Nineteenth Century: Political Polarization and Income Inequality in the United States
Even the most casual observer of American politics knows that today’s Republican and Democratic parties seem to disagree with one another on just about every issue under the sun
June 9, 2014
What’s Your WAM? Taking Stock of Dealers’ Funding Durability
One of the lessons from the recent financial crisis is the need for securities dealers to have durable sources of funding.
June 6, 2014
Crisis Chronicles: Canal Mania (1793)
Today, a leisurely trip down a canal on a quiet Sunday afternoon is a reminder of an unhurried time away from the hectic pace of modern commerce.
June 5, 2014
What Americans (Don’t) Know about Student Loan Collections
U.S. student debt has more than tripled since 2004, and at over $1 trillion is now substantially greater than both credit card and auto debt balances.
June 4, 2014
The CLASS Model: A Top‑Down Assessment of the U.S. Banking System
Central banks and bank supervisors have increasingly relied on capital stress testing as a supervisory and macroprudential tool.
Posted at 7:00 am in Financial Institutions | Permalink
June 2, 2014
Do Expected, in addition to Spot, U.S. Treasury Term Premiums Matter?
J. Benson Durham The spot term premium is the extra compensation investors require, today, to own long-term as opposed to short-term risk-free debt. The expected term premium is what they anticipate demanding later. Notably, the two don’t necessarily move in the same direction. Just as near-term expected short rates could decline with surprisingly easy monetary […]
May 30, 2014
Historical Echoes: Aye, That Piece of Eight You Be Thinkin’ of Were a Precursor to Today’s Dollar
Why do we associate pieces of eight with pirates?
May 28, 2014
Rising Household Debt: Increasing Demand or Increasing Supply?
Total consumer debt continued to increase in the first quarter of this year, marking the first time since the recession that aggregate debt had grown for three consecutive quarters, according to the May 2014 Quarterly Report on Household Debt and Credit.
May 23, 2014
Historical Echoes: The Trouble with Money
“The trouble with money,” said a Federal Reserve Bank of New York publication in the 1960s, “as with all material things in the world, is that it does not last forever.”
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