…memo on inflation was somehow flawed. DeLong writes: Moreover, what Luskin has plotted here is not the real exchange rate: the U.S. real exchange rate did not change by a…

…unreasonable cases, but if it is reasonable that the off-label use of the drug might have caused the damage, then the encouraged off-label use would lead to an assumption of…

…reserves held in the form of U.S. Treasury bonds. Debt assets and foreign reserves constituted 79% of China’s foreign assets in 2015, and the returns on these have been quite…

…the foreign exchange reserves, which have swelled in recent years as China’s exports surged and investors poured money into the country to profit from an economy now in its fourth…

…to a net supplier. This change will affect China’s external balance sheet, and its response to financial crises. China’s foreign assets have traditionally been overwhelmingly concentrated in foreign exchange reserves….

…does our money go? It goes into the foreign exchange market. The foreign exporter then receives their own currency from the foreign exchange market. And our dollars remain in the…

…rate which is high enough so that the banks have plenty of reserves on hand during the day and they keep those reserves at night. Thus, all that has really…

…it would seem that borrower risk is a factor, and the fact that these are excess reserves (which earn no interest) is also a factor. In that case, the low…

…goes for reserves. But in September of 2008, the Fed decides to pay interest on reserves—including Excess Reserves. The banks can now make 25 times what they pay in interest,…

…and exchange rate regimes under global financial integration I want to come back to the post I wrote recently on Angry Bear, regarding the power of exchange rates to insulate…