The Community Reinvestment Act is supposed to ensure that banks lend to low- and moderate-income households wherever they operate. But there are reasons to doubt its effectiveness. In the Washington Post this summer, I reported findings (from a forthcoming paper with Andrew Forrester) that more than two-thirds…
On November 12th I wrote a longish post explaining how growth fluctuations in two of the Federal Reserve's less-familiar liabilities—the foreign repo pool (FRP) and the Treasury General Account (TGA)—had contributed to a shortage of bank reserves that in turn caused repo rates to spike. I followed…
In a post published here in mid-November, I traced the Fed's repo-market troubles to post-2008 changes in the importance and volatility of two of the Fed's non-reserve liabilities: TGA balances and the foreign repo pool. Then, in a companion piece, I made some suggestions for reining-in those…
Modern Monetary Theory has been accused, not always fairly, of more serious shortcomings than you can shake a stick at. Among other things, critics have faulted it for not being all that modern, for passing-off tautologies as profundities, for wrongly assuming that the value of fiat money…
A couple posts ago, I criticized in general terms Modern Monetary Theorist Stephanie Kelton’s suggestion that the expense of the proposed Green New Deal need not make it “a drag on the economy” since the Fed could always foot the bill. That post steered clear of the…