Kocherlakota’s revelation
This is from Bloomberg: Federal Reserve Bank of Minneapolis President Narayana Kocherlakota said the central bank should hold the main interest rate near zero until unemployment falls below 5.5...
View ArticleThe fiscal cliff is not the end of the world
Today is supposed to be the end of the world – at least according to classic Mayan accounts (and Hollywood?). But so far we are still here and there are not really any signs that the world really is...
View ArticleThe fiscal cliff has never been a market theme
When I over the last couple of days have looked at my twitter account nine of ten tweets have been about the “fiscal cliff” and the financial media all over the world have been all about that horrible...
View ArticleThe Fed’s easing is working…in Mexico
Is the “Bernanke-Evans rule” working? Hell yes! At least in Mexico! The Mexican economy recovered fast from the shock in 2008-9 and real GDP has been growing around 5% in the last three years and now...
View ArticleFed NGDP targeting would greatly increase global financial stability
Just when we thought that the worst was over and that the world was on the way safely out of the crisis a new shock hit. Not surprisingly it is once again a shock from the euro zone. This time the...
View ArticleChuck Norris beats Wolfgang Schäuble
So far it is has been a remarkable week in the global financial markets. The ’deposit grab’ in Cyprus undoubtedly has shocked international investors and confidence in the ability of euro zone policy...
View ArticleThe “Weidmann rule” and the asymmetrical budget multiplier (is the euro zone...
During Christmas and New Years I have been able to (nearly) not think about monetary policy and economics, but I nonetheless came across some comments from Bundesbank chief Jens Weidmann from last...
View ArticleMankiw rule tells the Fed to tighten
The most famous monetary policy rule undoubtedly is the so-called Taylor rule, which basically tells monetary policy makers to set the key monetary policy interest rates as a function of on the one...
View ArticleYet another year of asymmetrical monetary policy – revisiting the Weidmann rule
Nearly a year ago – January 2 – I wrote a blog post on what I termed the Weidmann rule. In the blog post I argued that the ECB is basically following a rule – named after Bundesbank boss Jens Weidmann...
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