scholarly journals Distinguished Lecture on Economics in Government: Central Banking and Systemic Risks in Capital Markets

1989 ◽  
Vol 3 (2) ◽  
pp. 3-16 ◽  
Author(s):  
Andrew F Brimmer
Keyword(s):  
Stock Market ◽  
Federal Reserve ◽  
Central Banking ◽  
Stock Market Crash ◽  
Settlement Systems ◽  
Board Of Governors ◽  
Systemic Risks ◽  
Clearing And Settlement ◽  
Commercial Paper ◽  
Reserve System

Bagehot's conception of the last resort lending function of the central bank is shared by most economists today. On several occasions, the Federal Reserve has digressed from its overall strategy of monetary control to also undertake a tactical rescue of individual banks and segments of the capital market. On three other occasions, the Federal Reserve has intervened to counter systemic risks to the financial system beyond the arena of commercial banks. The events which prompted these actions were the threat to the commercial paper market triggered by the bankruptcy of the Penn Central Railroad in June 1970, the pressures on broker-dealer firms generated by the collapse of speculation in silver in early 1980, and the near failure of the clearing and settlement systems operated by stock and commodity exchanges which occurred during the stock market crash of 1987. I was a Member of the Board of Governors of the Federal Reserve System during the Penn Central episode, and I shared in the decisions to intervene. As a Public Governor of the Commodity Exchange, I helped to formulate the policies applied during the silver speculation and in the aftermath of the stock market collapse. The discussion which follows draws on those experiences.

When the Money Stopped

Money ◽  
2017 ◽  
Author(s):  
John Kenneth Galbraith ◽  
James K. Galbraith
Keyword(s):  
Stock Market ◽  
Federal Reserve ◽  
The United States ◽  
Bank Failures ◽  
Open Market ◽  
Federal Reserve System ◽  
Stock Market Crash ◽  
The Great Depression ◽  
Monetary System ◽  
Reserve System

This chapter examines the impact of the stock market crash of October 1929 on the monetary system of the United States. Very little attention has been given to the factors which converted the uncomfortable and distressing crises of the previous century into the profound and enduring tragedy known as the Great Depression. Neither the stock market crash of October 1929 nor the antecedent speculation has often been deemed to be a decisive cause. The chapter first considers how the stock market crash affected investment expenditures by business and consumer expenditures before discussing the bank failures that followed the crash. It also explores how bank failures and the fear of bank failures induced deflation and how the Federal Reserve System began open-market operations after harboring fears of inflation. Finally, it looks at the reform of the Federal Reserve System by legislation in 1933, 1934, and 1935.

Analisis Kemampuan BI7dRR, Fed Rate dan Inflasi Terhadap Indeks Harga Saham Gabungan

2020 ◽  
Vol 2 (2) ◽  
pp. 1-17
Author(s):  
Dedy Godrikus
Keyword(s):  
Time Series ◽  
Federal Reserve ◽  
Time Horizon ◽  
Federal Reserve System ◽  
Board Of Governors ◽  
Reserve System

Penelitian ini mempunyai tujuan untuk menguji apakah terdapat pengaruh dari suku bunga acuan, Fed Rate, serta tingkat inflasi terhadap indeks saham Indonesia. Adapun periode atau waktu penelitian diambil melalui publikasi data pergerakan saham, tingkat inflasi dan suku bunga pada Januari 2017-April 2020. Desain dari penelitian ini memiliki desain dengan pendekatan kuantitatif yakni dengan model analisis regresi berganda yang datanya diubah ke dalam bentuk first differency dan diuji menggunakan uji asumsi klasik terlebih dahulu kemudian dilakukan uji statistik terhadap data yang diperoleh. Adapun data-data penelitian ini berupa time horizon atau disebut juga data time series yang adalah data sekunder yakni berasal dari sumber-sumber laporan yang diterbitkan oleh Bank Indonesia atas data BI7dRR dan tingkat inflasi serta data tingkat Fed Rate yang diterbitkan oleh Board of Governors of the Federal Reserve System. Hasil penelitian menunjukkan bahwa BI7dRR tidak memiliki pengaruh tetapi positif terhadap IHSG sedangkan Fed Rate  memiliki pengaruh positif signifikan terhadap pergerakan Indeks Harga Saham Gabungan (IHSG), serta inflasi memiliki tidak memiliki pengaruh tetapi positif terhadap pergerakan IHSG.

The Self-Inflicted Wounds

Money ◽  
2017 ◽  
Author(s):  
John Kenneth Galbraith ◽  
James K. Galbraith
Keyword(s):  
United States ◽  
Exchange Rate ◽  
Stock Market ◽  
Federal Reserve ◽  
Gold Standard ◽  
The United States ◽  
The Self ◽  
Gold Content ◽  
Negative Consequences ◽  
Stock Market Crash

This chapter examines the negative consequences of Britain's return to the gold standard in 1925 and the stock market speculation in the United States in the late 1920s. In Britain, as elsewhere, prices fell in 1920 and 1921 as the wartime shortages were overcome, the budget was brought back under control, and the boom came to an end. Unemployment, which had been negligible in the preceding years, rose to 12.6 percent of the labor force in 1921. The chapter considers Winston Churchill's justification of Britain's decision to restore the pound to its prewar gold content of 123.27 grains of fine gold, its old exchange rate of $4.87, John Maynard Keynes's case against Churchill, and the stock market crash of October 1929 in the United States after the Federal Reserve Board had issued a warning against banks's use of Federal Reserve funds to finance speculation.

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