Forward Guidance and Macroeconomic Outcomes Since the Financial Crisis ∗ Jeffrey R. Campbell
... As such we identify forward guidance as interpreted by market participants, which may or may not be as intended by the members of the FOMC. In addition to introducing forward guidance to the monetary policy rule we make two changes to the preferences of the workhorse model. First, we include an addi ...
... As such we identify forward guidance as interpreted by market participants, which may or may not be as intended by the members of the FOMC. In addition to introducing forward guidance to the monetary policy rule we make two changes to the preferences of the workhorse model. First, we include an addi ...
The effects of US unconventional monetary policies in Latin America
... The opposite movement occurred after the Federal Reserve's announcement in May 2013 that anticipated the end of expansionary monetary policy in the United States. There were sudden reversals of capital inflows in several episodes between May 2013 and early 2014, as market perceptions of the Federal ...
... The opposite movement occurred after the Federal Reserve's announcement in May 2013 that anticipated the end of expansionary monetary policy in the United States. There were sudden reversals of capital inflows in several episodes between May 2013 and early 2014, as market perceptions of the Federal ...
Money as Friction: Conceptual Dissonance in
... “I first expound this approach in the context of a purely cashless economy –one in which there are assumed to be no transactions frictions that can be reduced through the use of money balances, and that accordingly provide a reason for holding such balances even when they earn a rate of return ...
... “I first expound this approach in the context of a purely cashless economy –one in which there are assumed to be no transactions frictions that can be reduced through the use of money balances, and that accordingly provide a reason for holding such balances even when they earn a rate of return ...
2. Reliance on foreign capital
... account deficits for 30 years. The gap between GDP (income generated in New Zealand) and GNI (income accruing to New Zealanders) has widened over the past 30 years. However, this does not mean that New Zealanders are worse off compared to 30 years ago. Looking at data from a range of countries we fo ...
... account deficits for 30 years. The gap between GDP (income generated in New Zealand) and GNI (income accruing to New Zealanders) has widened over the past 30 years. However, this does not mean that New Zealanders are worse off compared to 30 years ago. Looking at data from a range of countries we fo ...
Lesson 6
... • What happens if the central bank runs out of official international reserve assets (foreign assets)? • It must devalue the domestic currency so that it takes more domestic currency (assets) to exchange for 1 unit of foreign currency (asset). – This will allow the central bank to replenish its fore ...
... • What happens if the central bank runs out of official international reserve assets (foreign assets)? • It must devalue the domestic currency so that it takes more domestic currency (assets) to exchange for 1 unit of foreign currency (asset). – This will allow the central bank to replenish its fore ...
International spill-overs of uncertainty shocks: Evidence from a FAVAR
... are divided in two blocks: International and domestic. The international block is composed of data from the US and major world economies. For the US, we use an updated version of Bernanke et al. (2005) dataset. This dataset includes 116 individual data series covering a broad range of macroeconomic ...
... are divided in two blocks: International and domestic. The international block is composed of data from the US and major world economies. For the US, we use an updated version of Bernanke et al. (2005) dataset. This dataset includes 116 individual data series covering a broad range of macroeconomic ...
House Price Indexes, Approaches and Methods. Abstract
... calculating the aggregate index for real estate prices. Emphasis is placed on comparing price developments within housing categories, not among types of property or among the different regions of Iceland. Transaction effect the average value of the housing stock which might lead to an increased dive ...
... calculating the aggregate index for real estate prices. Emphasis is placed on comparing price developments within housing categories, not among types of property or among the different regions of Iceland. Transaction effect the average value of the housing stock which might lead to an increased dive ...
Does the Yield Curve Signal Recession?
... Despite the evidence linking the yield curve to economic growth, and even though yield-curve inversions preceded the two most recent recessions, many have suggested that the yield curve no longer reliably predicts economic growth. Noting that the economy is continually evolving, particularly the fin ...
... Despite the evidence linking the yield curve to economic growth, and even though yield-curve inversions preceded the two most recent recessions, many have suggested that the yield curve no longer reliably predicts economic growth. Noting that the economy is continually evolving, particularly the fin ...
Effects of the Exchange Rate on Output and Price Level:Evidence
... lack of inputs and higher cost relative to the prices of their domestic final products, firms tend to produce less, which leads to a reduction in aggregate supply. Higher wage costs channel (Krugman and Taylor, 1978; Bruno, 1979; Gylfason and Schmid, 1983; Hanson, 1983; Gylfason and Risager, 1984; S ...
... lack of inputs and higher cost relative to the prices of their domestic final products, firms tend to produce less, which leads to a reduction in aggregate supply. Higher wage costs channel (Krugman and Taylor, 1978; Bruno, 1979; Gylfason and Schmid, 1983; Hanson, 1983; Gylfason and Risager, 1984; S ...
Financial Report 2014--15
... institutional sources used to meet remaining need. The overall discount rate, which compares institutional dollars spent on financial aid to comprehensive fee revenue, increased to 39.6 percent for academic year 2014–15 (38.8 percent for 2013–14). Investments ...
... institutional sources used to meet remaining need. The overall discount rate, which compares institutional dollars spent on financial aid to comprehensive fee revenue, increased to 39.6 percent for academic year 2014–15 (38.8 percent for 2013–14). Investments ...
Does Central Bank Independence Frustrate the Optimal Fiscal
... Underwater mortgages are the root cause of private sector deleveraging in the U.S. and fiscalmonetary cooperation can help not only to “macro-manage” the private deleveraging process but also to speed it up and expedite the reverse Minsky journey.4 For government-guaranteed mortgages, the taxpayer i ...
... Underwater mortgages are the root cause of private sector deleveraging in the U.S. and fiscalmonetary cooperation can help not only to “macro-manage” the private deleveraging process but also to speed it up and expedite the reverse Minsky journey.4 For government-guaranteed mortgages, the taxpayer i ...
Principles of Macroeconomics, Case/Fair/Oster, 10e
... consumption of durable goods and housing investment. This option is not available when interest rates are near zero. In this case, stimulus must come primarily from fiscal policy. ...
... consumption of durable goods and housing investment. This option is not available when interest rates are near zero. In this case, stimulus must come primarily from fiscal policy. ...
Monetary Integration, Partisanship, and
... Furthermore, we assume that wage bargainers in coordinated systems, unlike bargainers in uncoordinated ones, have the capacity credibly to commit to centralized bargaining provided that employers (or their organizational representatives) are willing to go along. If not, bargaining will occur at the ...
... Furthermore, we assume that wage bargainers in coordinated systems, unlike bargainers in uncoordinated ones, have the capacity credibly to commit to centralized bargaining provided that employers (or their organizational representatives) are willing to go along. If not, bargaining will occur at the ...
Service Center Policy - Office for Sponsored Programs
... debt) are not to be included in the costs used to establish service center billing rates. The costs should, however, include depreciation of the equipment. Including equipment depreciation in the billing rates will generate funds that will enable service centers to purchase equipment needed in the f ...
... debt) are not to be included in the costs used to establish service center billing rates. The costs should, however, include depreciation of the equipment. Including equipment depreciation in the billing rates will generate funds that will enable service centers to purchase equipment needed in the f ...
The Use of Financial Derivatives by Canadian Firms
... financial risk to which they are exposed. While financial corporations are the most significant participants in derivatives markets, non-financial Canadian corporations are also important; for example, they are counterparties to around 15 per cent of the turnover in foreign exchange (FX) derivatives ...
... financial risk to which they are exposed. While financial corporations are the most significant participants in derivatives markets, non-financial Canadian corporations are also important; for example, they are counterparties to around 15 per cent of the turnover in foreign exchange (FX) derivatives ...
Submission to the Savings Working Group Executive summary
... performance by reducing pressure on real interest rates and the real exchange rate, and also reduce the risks associated with the current very heavy dependence on borrowed international capital. National savings – the savings of New Zealand residents – are, of course, not a policy lever; something t ...
... performance by reducing pressure on real interest rates and the real exchange rate, and also reduce the risks associated with the current very heavy dependence on borrowed international capital. National savings – the savings of New Zealand residents – are, of course, not a policy lever; something t ...
Monetary Policy and European Unemployment
... cannot be used to stimulate growth or to reduce unemployment. “Output is a real magnitude, not a monetary magnitude.” (Friedman, 2006: 4) Thus, monetary policy is innocent, it does not affect growth and unemployment directly but only indirectly through its effects on expectations. In the words of Ce ...
... cannot be used to stimulate growth or to reduce unemployment. “Output is a real magnitude, not a monetary magnitude.” (Friedman, 2006: 4) Thus, monetary policy is innocent, it does not affect growth and unemployment directly but only indirectly through its effects on expectations. In the words of Ce ...
Asset allocation in a low-yield and volatile environment
... The VCMM projections are based on a statistical analysis of historical data. Future returns may behave differently from the historical patterns captured in the VCMM. More important, the VCMM may be underestimating extreme negative scenarios unobserved in the historical period on which the model esti ...
... The VCMM projections are based on a statistical analysis of historical data. Future returns may behave differently from the historical patterns captured in the VCMM. More important, the VCMM may be underestimating extreme negative scenarios unobserved in the historical period on which the model esti ...
Robert NBER WORKING PAPER SERIES PUBLIC FINANCE IN MODELS OF ECONOMIC GROWTH
... The recent literature on endogenous economic growth allows for effects of fiscal policy on long-term growth. If the social rate of return on investment exceeds the private return, then tax policies that encourage investment can raise the growth rate and levels of utility. An excess of the social ret ...
... The recent literature on endogenous economic growth allows for effects of fiscal policy on long-term growth. If the social rate of return on investment exceeds the private return, then tax policies that encourage investment can raise the growth rate and levels of utility. An excess of the social ret ...
The NAIRU and the Natural Rate of Unemployment
... macroeconomic equilibrium is potential output that can be defined as an output of the economy which fully exploits production factors while using a given technology. At the same time, this is a product for which the actual rate of inflation is equal to the expected rate of inflation or to put it in ...
... macroeconomic equilibrium is potential output that can be defined as an output of the economy which fully exploits production factors while using a given technology. At the same time, this is a product for which the actual rate of inflation is equal to the expected rate of inflation or to put it in ...
Interest rate
An interest rate is the rate at which interest is paid by borrowers (debtors) for the use of money that they borrow from lenders (creditors). Specifically, the interest rate is a percentage of principal paid a certain number of times per period for all periods during the total term of the loan or credit. Interest rates are normally expressed as a percentage of the principal for a period of one year, sometimes they are expressed for different periods such as a month or a day. Different interest rates exist parallelly for the same or comparable time periods, depending on the default probability of the borrower, the residual term, the payback currency, and many more determinants of a loan or credit. For example, a company borrows capital from a bank to buy new assets for its business, and in return the lender receives rights on the new assets as collateral and interest at a predetermined interest rate for deferring the use of funds and instead lending it to the borrower.Interest-rate targets are a vital tool of monetary policy and are taken into account when dealing with variables like investment, inflation, and unemployment. The central banks of countries generally tend to reduce interest rates when they wish to increase investment and consumption in the country's economy. However, a low interest rate as a macro-economic policy can be risky and may lead to the creation of an economic bubble, in which large amounts of investments are poured into the real-estate market and stock market. In developed economies, interest-rate adjustments are thus made to keep inflation within a target range for the health of economic activities or cap the interest rate concurrently with economic growth to safeguard economic momentum.