Central Banking
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Inflation Continued to Decline in April
“While inflation is declining once more, members of the Federal Open Market Committee (FOMC) have suggested rates would need to remain high for longer than they had previously projected.” ~William J. Luther
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Why Does the Federal Government Borrow?
“Policymakers have an incentive to finance spending with money printing and debt to hide the cost of spending from taxpayers. These costs cannot be hidden forever, though.” ~Thomas Savidge
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The Demise of the Dual Banking System
“The issue comes down to whether a state-chartered bank that fulfills the legal requirements for a master account can be denied one by the Federal Reserve.” ~Gerald P. Dwyer
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Is The Fed Manipulating the Market?
“We cannot just look at the Fed’s target rate to determine whether it is manipulating the market. We must consider its target rate relative to the natural rate.” ~Bryan Cutsinger
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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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Inflation Declined in March, But Remains High
“Market participants continue to expect the Fed will cut its federal funds rate target this year — just not anytime soon.” ~ William J. Luther
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A Better Model Won’t Fix The Fed
“The whole point of expectations-responsive monetary policy is to remove the discretionary and technocratic elements from central banking. Disappointingly but unsurprisingly, the Fed is doing the opposite: doubling down on discretion and technocracy.” ~Alexander W. Salter
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Inflation We Can Feel But Don’t Measure
“Regardless of whether one thinks that the CPI should include interest rates and/or asset prices, it seems clear that consumers factor in these costs when evaluating the cost of living.” ~Joshua R. Hendrickson
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‘Shock Values’: An Idiosyncratic Economic History
“While it provides a concise accounting of the many efforts taken to address inflation and deflation over the history of the republic, there is a cost to recounting such a rich history in so few pages.” ~Paul H. Kupiec
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Fixing A Big Mistake in Risk-Based Capital Rules
“Both long Treasuries and mortgage-backed securities guaranteed by government agencies are in current regulation included as ‘High Quality Liquid Assets.’ But of course they both can and have created plenty of interest rate risk.” ~Alex J. Pollock
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“The Price of Time” and Broken Central Banking
“The unique value of Chancellor’s book, beyond tracing this intellectual history of interest and illustrating it by financial debacles up and down the centuries, is to connect the social and market outcomes with the broken money markets.” ~Joakim Book
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Fact-Checking “Greedflation”
“By fueling an overall increase in demand, central banks can generate a sustained increase in the general level of prices — inflation. Central banks are the primary source of money creation, not firms.” ~Nicolás Cachanosky
