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September/October 2008

Posted 2008-09-01

Monetary Economic Research at the St. Louis Fed During Ted Balbach’s Tenure as Research Director

by Michael D. Bordo and Anna J. Schwartz

Ted Balbach served as research director at the Federal Reserve Bank of St. Louis from 1975 to 1992. This article lauds his contributions during that time, including the expanded influence of the Review, enhanced databases and data publications, and a visiting scholar program that attracted leading economists from around the world. Balbach is remembered fondly as a visionary leader and gracious mentor.

Posted 2008-09-01

Oil and the U.S. Macroeconomy: An Update and a Simple Forecasting Exercise

by Kevin L. Kliesen

Some analysts and economists recently warned that the U.S. economy faces a much higher risk of recession should the price of oil rise to one hundred dollars per barrel or more. In February 2008, spot crude oil prices closed above one hundred dollars per barrel for the first time ever, and since then they have climbed even higher. 

Posted 2008-09-01

Banking Crisis Solutions Old and New

by Alistair Milne and Geoffrey E. Wood

In 2007 Britain experienced its first run on a bank of any macroeconomic significance since 1866. This was not dealt with by the method that had maintained banking stability for so long: letting the bank fail but supplying abundant liquidity to the markets to prevent contagion. 

Posted 2008-09-01

The Credit Crunch of 2007-2008: A Discussion of the Background, Market Reactions, and Policy Responses

by Paul Mizen

This article discusses the events surrounding the 2007-08 credit crunch. It highlights the period of exceptional macrostability, the global savings glut, and financial innovation in mortgage-backed securities as the precursors to the crisis.