ONCE UPON A TIME, when my twin brother and I were tots, our father convinced us that he could make a traffic light change from red to green whenever he wanted it to. Raising his hand to the light as we sat at an intersection, he would…
In my recent Cato Institute policy analysis, “Requiem for QE,” I analyze the transcripts of the 2008 and 2009 Federal Open Market Committee (FOMC) meetings in some detail. Among them, the March 2009 transcript stands out as particularly troubling, as it reveals the FOMC’s failure to appreciate…
Why do I keep harping on interest on reserves? Because, IMHO, the Fed's decision to start paying interest on reserves contributed at least as much as the failure of Lehman Brothers or any previous event did to the liquidity crunch of 2008:Q4, which led to a deepening…
In my last post regarding Ben Bernanke's memoir, I took Bernanke's Fed to task for electing to sterilize its pre-AIG emergency lending, thereby making sure that, while it was rescuing a small number of troubled firms, it was also reducing the liquid reserves available to others. It…
CMFA Director George Selgin recently appeared on EconTalk, the weekly podcast from the Library for Economics and Liberty hosted by Russ Roberts. He and Russ discussed the causes of the 2007–08 financial crisis and the Fed’s response to it, with George drawing on his Alt-M reviews (see…