For many years, economists have struggled to explain the “equity premium puzzle”—the fact that the average return on stocks is larger than what would be expected to compensate for their riskiness.
July 11, 2012
The Puzzling Pre‑FOMC Announcement “Drift”
Posted at 7:00 am in Expectations, Financial Markets, Monetary Policy, Stocks | Permalink | Comments (9)
July 9, 2012
Location, Location, and Pacification: The Effect of Crime Reduction on Residential Property Value
In this post, we document the relationship between crime and house prices in the city of Rio de Janeiro, Brazil. One fully expects crime, as a public “bad,” to exert a downward force on prices; indeed, this is a common finding in the literature on amenity valuation.
July 6, 2012
Historical Echoes: The Creation of the Contemporary U.S. Mortgage
Residential mortgages, as they are known in the United States, are fairly modern creatures.
July 2, 2012
CCAR: More than a Stress Test
The Federal Reserve recently released the results of its latest stress test of large bank holding companies (BHCs).
June 29, 2012
Historical Echoes: A Water Machine that Simulates the Economy
In 1949, engineer/economist A. W. H. (Bill) Phillips unveiled a mechanical economic model, the Phillips machine, which could demonstrate—by pushing colored water through clear pipes—how money moves through the economy.
June 27, 2012
Fiscal Drag from the State and Local Sector?
With July just around the corner, most cities and states are preparing for the start of a new fiscal year.
June 25, 2012
Mapping and Sizing the U.S. Repo Market
The U.S. repurchase agreement (repo) market is a large financial market where participants effectively provide collateralized loans to one another.
June 11, 2012
Money Market Funds and Systemic Risk
On September 16, 2008, Reserve Primary Fund, a money market fund (MMF) with $65 billion in assets under management, announced that losses in its portfolio had caused the value of shares in the fund to drop from $1.00 to $0.97.
June 8, 2012
Historical Echoes: When Fed Officials Wax Poetic
When was the last time a speech by a Federal Reserve official contained a full-length poem?
Posted at 7:00 am in Historical Echoes | Permalink
June 6, 2012
Just Released: New York’s Latest Beige Book Report Signals Steady Growth
The New York Fed’s latest Beige Book report points to continued moderate growth in the regional economy and some reduction in cost pressures.
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