In a speech by Janet Yellen on April 11, 2012, she talked about her preferred version of the Taylor rule to determine the Federal Funds rate. The Taylor (1993) rule calls for the federal funds rate to begin rising in early 2013, whereas the Taylor (1999) rule has its liftoff in early 2015, a lot […]
by David Zetland on Aguanomics Time for a new boat OM writes from California: Have you thought or written about public purchase of water flows needed for the environment? We have a new water bond that includes a lot of funds for this sort of thing. It strikes me that it fits with the model […]
Lifted from an op ed e-mail from Stormy: A piece in the Guardian is interesting, dealing with poverty (real poverty) and inequality. I think that Angry Bear should really address what can be done about rising inequality. Here are the last two paragraphs: The prospect is one of a society such as the one we […]
Thomas Piketty’s Capital in the Twenty-First Century is the first book to make a data-driven examination of economic inequality. Based on hundreds of years worth of data, it attempts to determine the long-term trends in inequality and the social and political consequences that follow from them. In this final post, I want to highlight the most […]
I posted a graph where I overlaid the Effective Demand rule over the Taylor rule variations done by Tim Duy. You can see differences between the rules since the crisis. Why the difference? And does the difference matter? Basic Taylor rule Target Fed rate = natural real rate + inflation + 0.5*(inflation – inflation target) […]
The San Francisco Fed has a paper, Assessing Expectations of Monetary Policy, where they make a case that the market expects monetary policy to be more accommodative than the Fed is projecting. How could that be when the Fed has been so aggressively accommodative until now? Shouldn’t they tighten already? In my view, the market […]
by Joseph Joyce The IMF and Sovereign Debt The continuing inability of the Eurozone economies to break out of their current impasse means that any optimistic projections of declining debt to GDP ratios are unlikely to be achieved. As long as European governments continue to raise funds in the financial markets on favorable […]
Any one knowledgeable?…leave a comment on winners and losers. Deal book today describes rather ho hum changes in capital requirements for banks with a positive spin: FED’S DIET PLAN FOR BANKS The Federal Reserve said on Monday that it planned to increase the pressure on large financial firms to slim down, DealBook’s Peter Eavis writes. […]
It is commonly known that the CBO projects potential output, but they also have 2 measures for the natural rate of unemployment… a Short-term & a Long-term rate. (link) The description at FRED economic data says… “The natural rate of unemployment (NAIRU) is the rate of unemployment arising from all sources except fluctuations in aggregate […]
If you equate wealth and prosperity (not a crazy equation), then one of the best measures of a country’s prosperity is median household net worth. It arguably says a lot more about prosperity than various income measures. It tells you how the typical household (50% have more, 50% have less) is doing. If lots of […]