Home
Philip Rothman's Library tagged → View Popular
Paper Probes Fed Nightmare — Inflating Away U.S. Debt - Real Time Economics - WSJ
"While it may be the stuff of nightmares for central bankers and dollar defenders, a new paper describes how the U.S. could use inflation to reduce the burden of record-high and rising government debt."
Quantitative Easing: A Rationale and Some Evidence from Japan
"This paper reviews the rationale for quantitative easing when central bank policy rates reach near zero levels in light of recent announcements regarding direct asset purchases by the Bank of England, the Bank of Japan, the U.S. Federal Reserve and the European Central Bank. Empirical evidence from the previous period of quantitative easing in Japan between 2001 and 2006 is presented. During this earlier period the Bank of Japan was able to expand the monetary base very quickly and significantly. Quantitative easing translated into a greater and more lasting expansion of M1 relative to nominal GDP. Deflation subsided by 2005. As soon as inflation appeared to stabilize near a rate of zero, the Bank of Japan rapidly reduced the monetary base as a share of nominal income as it had announced in 2001. The Bank was able to exit from extensive quantitative easing within less than a year. Some implications for the current situation in Europe and the United States are discussed. "
Econbrowser: Commodity prices and the Fed
"I've been discussing possible explanations for the recent tendency of the dollar prices of commodities to move together. On Friday we received a very useful data point for distinguishing between the different hypotheses."
Econbrowser: Commodity inflation
"Why are the prices of so many commodities rising in an economy that seems to remain quite weak?"
FRBSF Economic Letter: Inflation Expectations and the Risk of Deflation (2009-34, 11/2/2009)
"Predicting the course of inflation is one of the most important challenges facing monetary policymakers. Useful aids to such prediction are the measures of expected future inflation obtained from prices in government bond markets. An examination of recent inflation-indexed and non-indexed U.S. Treasury bond yields suggests that financial market participants believe that the probability of prolonged deflation has become fairly small."
New Statesman - What’s so bad about inflation?
"In contrast to the tiny costs of inflation, the costs of unemployment are enormous "
FRBSF Economic Letter: Disagreement about the Inflation Outlook (2009-31, 10/5/2009)
Disagreement among economic forecasters about the future path of inflation has risen substantially since the start of the recession. The nature of this disagreement varies with the forecast time horizon, with some forecasters expecting much lower short-run inflation and others anticipating much higher long-run inflation. This variation may complicate the Federal Reserve’s monetary policy communications strategy.
Econbrowser: Federal Reserve reverse repurchases
Here I offer some thoughts on Bloomberg's account that the Fed has made inquiries with its dealers about the feasibility of a significant increase in the Fed's reverse repo operations
Tightening Credit Becomes Bernanke Bind in Bond Purchase Unwind - Bloomberg.com
July 24 (Bloomberg) -- Now that the U.S. economy shows tentative signs of recovery, James Bullard, president of the Federal Reserve Bank of St. Louis, wants the Fed to adopt a plan for taming the inflation he expects may follow the end of the recession. Unless the central bank puts a strategy in place and presents it to the public, inflation expectations may run rampant, Bullard says.
Has Greater Globalization Made Forecasting Inflation More Difficult? - Economic Letter, July 2009 - FRB Dallas
Monetary policy affects real economic activity and the price level with long and variable lags. Consequently, forecasts of inflation and real economic activity are key inputs to central banks’ decisionmaking.
Economics focus: Put out | The Economist
HAVING raised the alarm on deflation, the Federal Reserve has now begun to sound the all clear.
St. Louis Fed: WP 2009-030A "Does Money Matter in Inflation Forecasting?"
This paper provides the most fully comprehensive evidence to date on whether or not monetary aggregates are valuable for forecasting US inflation in the early to mid 2000s. We explore a wide range of different definitions of money, including different methods of aggregation and different collections of included monetary assets. In our forecasting experiment we use two non-linear techniques, namely, recurrent neural networks and kernel recursive least squares regression - techniques that are new to macroeconomics. Recurrent neural networks operate with potentially unbounded input memory, while the kernel regression technique is a finite memory predictor. The two methodologies compete to find the best fitting US inflation forecasting models and are then compared to forecasts from a naive random walk model. The best models were non-linear autoregressive models based on kernel methods. Our findings do not provide much support for the usefulness of monetary aggregates in forecasting inflation.
FT.com / Comment / Opinion - The Fed must reassure markets on inflation
The interest rate on 10-year US Treasury bonds almost doubled in six months, rising from 2.26 per cent last December to 3.98 per cent in mid-June, before decreasing slightly in recent days. This sharp rise happened despite the Federal Reserve’s quantitative easing policy aimed at lowering long-term rates by buying $300bn (€21bn, £18bn) of Treasuries and promising to buy more than $1,000bn of mortgage securities.
The Term Structure of Inflation Expectations
We present estimates of the term structure of inflation expectations, derived from an affine model of real and nominal yield curves. The model features stochastic covariation of inflation with the real pricing kernel, enabling us to extract a time-varying inflation risk premium. We fit the model not only to yields, but also to the yields’ variance-covariance matrix, thus increasing identification power. We find that model-implied inflation expectations can differ substantially from break-even inflation rates when market volatility is high. Our model’s ability to be updated weekly makes it suitable for real-time monetary policy analysis.
Inflation Expectations and Monetary Policy :: Charles T. Carlstrom and Kyle Fee :: Economic Trends :: 06.09.09 :: Federal Reserve Bank of Cleveland
Recently, there has been what many observers consider to be a disturbing increase in the yield curve. The concern is that the rising yield curve may be signaling an increase in longer-term inflation expectations.
Mugabe says Zimbabwe may revive use of own currency | Top News | Reuters
HARARE (Reuters) - President Robert Mugabe said Zimbabwe may revive the use of its own currency because the U.S. dollar introduced to tame hyperinflation was unavailable to a majority of people.
Economic View - Cross Inflation Off the Long List of Worries - NYTimes.com
SOME people with hypersensitive sniffers say the whiff of future inflation is in the air. What’s that, you say? Aren’t we experiencing deflation right now? The answer is yes.
macroblog: CPI: The left and the right of it
We got a good reading of May's inflation numbers this week. On both the producer and the consumer sides, price measures for the month came in well short of market expectations.
A Slacker’s Debate Hits Wall Street and the Fed - Real Time Economics - WSJ
An important and interesting debate is brewing inside the Federal Reserve and on Wall Street about how much slack has built up in the economy during approximately a year and a half of recession.
Greg Mankiw's Blog: Deflation?
The above graph, from the Cleveland Fed, shows inflation as gauged by the consumer price index and by a measure called the median CPI.
Selected Tags
Related Tags
Sponsored Links
Top Contributors
Groups interested in inflation
-
Banking and Economy
Items: 16 | Visits: 44
Created by: aka007
-
Grade Inflation
A collated list of press cu...
Items: 7 | Visits: 27
Created by: Tom Goodwin
Highlighter, Sticky notes, Tagging, Groups and Network: integrated suite dramatically boosting research productivity. Learn more »
Join Diigo