Repatriation taxes are unlikely to explain the rise in cash holdings of U.S. firms.
Federal revenue is currently well below its postwar, pre-crisis average, while expenditure is well above, with both factors contributing to a large and persistent deficit. Under current law, the deficit situation would be quickly, if painfully, resolved, with the lion’s share resulting from increased tax revenue.
Most central banks implement quantitative easing through asset purchases. Sweden took a different path.
When the economic shocks that cause recessions in different economies have large common components, there may be lessons to be learned by studying how different economies respond.
The Fed’s concern for housing is a relatively new phenomenon. Historically, house price bubbles have been localized and affected only areas with rapid growth. The latest housing bust, however, was a nationwide problem with important ramifications for employment and economic activity.
It is reasonable to believe that output, employment, and inflation will return to their long-run or targeted values slowly and steadily.
Although similar in many ways, subprime hybrids were really different from prime hybrids.
Concealed Earnings fraud accounts for almost two-thirds of the total overpayments due to all fraud.
The behavior of term OIS rates following the three instances of FOMC verbal guidance provides no support for the efficacy of the FOMC’s forward guidance monetary policy.
Our approach offers several advantages over LSAPs as a financial mechanism to enhance forward guidance.
Assessing the state of the economy requires estimates of trends in employment and the labor force. Large monthly fluctuations make it difficult to infer these from monthly data.
A GIIPS crisis wouldn't have too strong an effect on the U.S. economy, but an EU-wide crisis may be a serious concern.
If investment spending is sufficiently insensitive to interest rate changes
and the effect of Fed actions on interest rates is sufficiently weak, the net effect of the persistent zero interest rate policy could be negative.
Vehicle sales have been a bright spot during the tepid rebound of the American economy from its 2009 trough.
Politicians, market participants, and economists have argued about
whether the increased trading induced by the growth of index funds over
the past decade is a cause of high commodity prices.
Ultimately, covered bonds and ABS are complements, not substitutes.
Changes in wealth, according to our simple calculations, can account for almost all of the observed consumption fluctuations of the past two decades.
Little difference in economic performance during the past two decades…is consistent with the theoretical and empirical evidence that monetary policy has no permanent effect on real variables.
The United States can simply recycle the financial capital inflows from China and re-export them back to China in the form of FDI. In so doing, the United States gains a substantially larger rate of return from FDI than China does from owning U.S. government bonds.
Gross job losses for large firms were 60 percent higher in 2009:Q2 than in 2006:Q1, while those for medium and small firms were 42 percent and 12 percent higher, respectively.
Okun’s law can be a useful guide for monetary policy, but only if the natural rate of unemployment is properly measured.
FDI flows from overseas parent companies contracted, but intracompany debt and reinvested earnings were affected much more than equity FDI.
Recent changes in the relationships
among GDP growth, the unemployment
rate, and the employment-to-population
ratio cast doubt on using these relationships
to predict future unemployment.
The European debt crisis could certainly affect the U.S. economy through other channels…but its direct impact on U.S. exports is likely to be small.
One look at recent Congressional Budget Office data shows how much estimates of the output gap can change as time passes.
During 1995-2007, home equity increased more than gross income for high-, low- and middle-income groups.
Greater transparency is a means to better synchronize the public with policymakers and minimize the risks of undesirable economic outcomes.
Disentangling the true drivers of oil prices is a critical first step for allocating resources and designing good policy.
Initial claims may now be useful for forecasting employment growth during periods of increasing economic activity.
The hump in the Greek yield curve exists because the calculated yields assume that the bonds will pay off at their full value but market prices incorporate expectations that the payoff will be much lower.
It is not clear how monetary policy might be used to reduce local unemployment rates where recruiting intensity is high but the right kind of worker is hard to find.
The enormous quantity of excess reserves can create an even greater expansion in the money supply.
How should one conclude whether the data have come in stronger, weaker, or as expected?
Employment turnover was significantly lower following the Great Recession than following the previous two recessions.
The recent behavior of key fiscal policy variables draws some parallels with the U.S. experience in the Civil War and the two world wars. A specific concern is the possibility of high inflation to finance the accumulated debt.