Central Banking
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Have Mount Laurel Obligations Made New Jersey Housing More Affordable? A Synthetic Control Analysis of Housing Supply and Cost
This paper investigates the effect of affordable housing obligations in New Jersey on cost of living, cost of housing, and actual housing production. New Jersey’s Mount Laurel court cases established […]
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Enabling Bad Behavior: The Federal Reserve’s Municipal Liquidity Facility in Retrospect
Executive Summary In response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act greatly expanded government intervention in the economy. Among many hasty creations of March […]
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How Does the Federal Reserve Set Interest Rates?
Introduction People in financial markets and in the media regularly track Federal Reserve announcements and forecast what the Fed’s interest rate target will be in the future. But when people […]
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What is Central Bank Independence?
The explainer defines central bank independence, describes its theoretical desirability, and reviews classic and contemporary studies on how central bank independence affects key macroeconomic variables.
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How Currency Shapes Global Trade: Exchange Rates, Investment, and Stability
Free trade and free markets promote sound money, as countries compete for business and investment.
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There’s No Good Reason to Raise the Inflation Target
“Why not give the central bank a wider berth, if it helps to stabilize the economy? Because it doesn’t actually help. Interest rates are a distraction.” ~Alexander W. Salter
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Chairman Powell and The Fed’s Limits
“Congress should applaud Chairman Powell’s candor on uncertainty and strongly support his principle of operating the Fed within the limits of its mandate.” ~Alex J. Pollock
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Bank Term Funding Program Discounts the Discount Window
“The Fed says it created BTFP to ‘support American businesses and households.’ But those businesses and households will ultimately be on the hook if the Fed’s risk-taking turns out to be too much.” ~ Nicolás Cachanosky
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Yes, the Fed Is a Failure
“DeSantis is right to call out the Fed. And honesty compels one to acknowledge the Fed’s failures, even if those failures are pointed out by politicians of whom one disapproves. Anything less subjects responsible policy analysis to rank partisanship.” ~ Alexander William Salter
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The Fed Is Bankrupt
“The most recent data show that the Fed owes the Treasury over $41 billion, which exceeds its total capital. The Fed, by common standards, is indeed insolvent.” ~ Thomas L. Hogan
