scholarly journals Don't End or Audit the Fed: Central Bank Independence in an Age of Austerity

2018 ◽  
Author(s):  
Neil H. Buchanan ◽  
Michael C. Dorf
Keyword(s):  
Central Bank ◽  
Interest Rates ◽  
Federal Reserve ◽  
Political Influence ◽  
The United States ◽  
Political Actors ◽  
Debt Ceiling ◽  
Market Driven ◽  
The 2008 Financial Crisis

102 Cornell Law Review (2016)The Federal Reserve (the Fed) is the central bank of the United States. Because of its power and importance in guiding the economy, the Fed's independence from direct political influence has made it a target of ideologically motivated attacks throughout its history, with an especially aggressive round of attacks coming in the wake of the 2008 financial crisis and ongoing today. We defend Fed independence. We point to the Fed's exemplary performance during and after the 2008 crisis, and we offer the example of a potential future crisis in which Congress falls to increase the debt ceiling to show how the Fed's independence makes it the only entity that can minimize the damage during crises (both market-driven and policy-induced). We further argue that the Fed's independence is justified to prevent self-dealing by politicians, even when no crisis is imminent. Although the classic justification for Fed independence focuses on the risk that political actors will keep interest rates lower than appropriate for the long-term health of the economy, we show that Fed independence addresses the risk of self-dealing and other pathologies even when, as now, political actors favor tighter monetary policy than appropriate for the long-term health of the economy.

Plans will raise China's profile in standard-setting

2021 ◽  
Keyword(s):  
Standard Setting ◽  
The United States ◽  
Leadership Role ◽  
International Level ◽  
Content Type ◽  
Green Development ◽  
Development Feature ◽  
Market Driven ◽  
Industry Associations

Significance They establish a framework for building China’s influence in the standard-setting realm over the next 15 years. China has developed a considerable presence in standards development organisations, both at the international level and in industry associations primarily based in the United States and Europe. However, its influence in these forums remains low relative to its ambitions. Impacts China will allow market-driven multistakeholder standards associations a greater role in a process so far coordinated mainly by the state. The Communist Party will maintain an overall leadership role in driving China’s standardisation work. China-led regional forums and China-based multistakeholder associations may in the long term displace US-based forums in specific areas. Environmental protection and 'green development' feature heavily in the guidelines, offering concrete areas for international cooperation. China will look to gain competencies in accreditation, certification, inspection and testing, where it has historically lagged.

scholarly journals Journal of the History of Economic Thought Preprints - Limits to Arbitrage and Interest Rates: A Debate Between Keynes, Hawtrey and Hicks

2018 ◽  
Author(s):  
Lucy BRILLANT
Keyword(s):  
Business Cycle ◽  
Central Bank ◽  
Interest Rates ◽  
Economic Thought ◽  
History Of Economic Thought ◽  
Short Term ◽  
Limits To Arbitrage ◽  
History Of ◽  
The Business Cycle

This paper deals with a debate between Hawtrey, Hicks and Keynes concerning the capacity of the central bank to influence the short-term and the long-term rates of interest. Both Hawtrey and Keynes considered the central bank’s ability to influence short-term rates of interest. However, they do not put the same emphasis on the study of the long-term rates of interest. According to Keynes, long-term rates are influenced by future expected short-term rates (1930, 1936), whereas for Hawtrey (1932, 1937, 1938), long-term rates are more dependent on the business cycle. Short-term rates do not have much effect on long-term rates according to Hawtrey. In 1939, Hicks enters the controversy, giving credit to both Hawtrey’s and Keynes’s theories, and also introducing limits to the operations of arbitrage. He thus presented a nuanced view.

scholarly journals INSTYTUCJONALNA I KOMPETENCYJNA EWOLUCJA BANKU CENTRALNEGO STANÓW ZJEDNOCZONYCH AMERYKI W XX WIEKU

2016 ◽  
Vol 10 (2) ◽  
pp. 275
Author(s):  
Wojciech Kwiatkowski
Keyword(s):  
Twentieth Century ◽  
Central Bank ◽  
Federal Reserve ◽  
The United States ◽  
Institutional Evolution ◽  
Federal Reserve System ◽  
Initial Shape ◽  
Treasury Department ◽  
Reserve System ◽  
The U.S

Institutional and Competence Evolution of the U.S. Central Bank in the Twentieth CenturySummary The article describes the initial shape of the U.S. central bank, i.e. the Federal Reserve System created under the federal act of 1913 as a “Federal Reserve”, as well as the reasons for its competence and institutional evolution mainly in the thirties of the twentieth century. The paper seeks to identify the consequences of the absence of statutory regulations – in many ways necessary for the proper functioning of the central bank in the United States as a confederation, which has become a major cause of the appropriation of powers by the representatives of the private sector at the central bank. In addition, by analyzing the agreement concluded by the representatives of the bank and the U.S. Treasury Department the article shows the consequences of the absence of constitutional guarantees for the central bank’s operational independence. The article also seeks to name and describe the laws passed in the twentieth century, which have contributed significantly to today’s field of competence of the Federal Reserve System and its present modus vivendi.

Basic Monetary Policy Objectives

2013 ◽  
Author(s):  
Stephen H. Axilrod
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Federal Reserve ◽  
Policy Objectives ◽  
Important Objective

What are the Fed’s basic objectives? As noted in the preceding chapter, the goals set for monetary policy in the Federal Reserve Act are maximum employment, stable prices, and low, long-term interest rates. The Fed’s other very important objective, the maintenance of systemic stability...

Investing for Growth and Security

2019 ◽  
pp. 193-206
Author(s):  
William G. Gale
Keyword(s):  
United States ◽  
Research And Development ◽  
Interest Rates ◽  
Federal Government ◽  
The United States ◽  
Federal Spending ◽  
President Obama ◽  
Transit Systems ◽  
Historical Levels

Besides its investment in people, the federal government makes critical investments in infrastructure and research and development. Because federal spending in these areas has fallen significantly in recent years and interest rates are low relative to historical levels, this chapter proposes sizable increases for both categories. The increases in infrastructure spending will provide the resources needed to restore and update aging roads, bridges, and public transit systems, while the increases in research and development will help the United States to explore cutting-edge technologies. Policymakers should also fund the military’s long-term plans through 2032, as outlined by President Obama, and let spending grow modestly afterward. That would allow for a continuing presence overseas. If a new war broke out, policymakers presumably would provide the additional temporary funds to ensure that America achieved its mission and emerged victorious.

scholarly journals Long-Term Timber Contracts in the Southeastern United States: Updating the Primer Valuation Framework

2020 ◽  
Vol 66 (6) ◽  
pp. 653-665
Author(s):  
Hector I Restrepo ◽  
Bin Mei ◽  
Bronson P Bullock
Keyword(s):  
United States ◽  
Interest Rates ◽  
Southeastern United States ◽  
Price Volatility ◽  
Forest Products ◽  
The United States ◽  
Raw Material ◽  
Conditional Volatility ◽  
Material Supply

Abstract Timberland ownership has drastically changed in the United States since the 1980s, driven by the divestitures of vertically integrated forest products companies. Having sold their timberland, forest products companies have exposed themselves more to the risk of raw material supply. To hedge against this risk, forest products companies usually use long-term timber contracts (LTTC). The objective of this article is to update the valuation framework for LTTCs proposed by Shaffer (1984) by including alternative option price models and refining the estimates of some key economic variables. In particular, conditional volatility from the generalized autoregressive conditional heteroscedasticity model and quasi-conditional volatility from rolling estimation windows, in addition to simple standard deviation, are used for the volatility estimates in the option pricing models. Contrary to the previous result by Shaffer (1984), our analysis suggests that LTTCs that were once profitable for forest products companies in the 1980s are no longer so under current market conditions. This is primarily because both timber price volatility and the risk-free interest rates have declined significantly. Thus, to be better off, forest products companies need to either lower the administration and management costs of those LTTCs or rely more on the open market for timber procurement. Study Implications: Forest products companies have traditionally relied on long-term timber contracts (LTTC) negotiated with forest landowners to mitigate the risk of raw material supply. The value of these LTTCs highly depends on the economic context. This research provides some insights into the valuation of LTTCs in the southeastern United States. Forest products companies can use this updated framework to aid their decisionmaking in timber procurement.

What Is Stimulus without Debt?

2018 ◽  
Author(s):  
Laurence Seidman
Keyword(s):  
United States ◽  
Central Bank ◽  
Federal Reserve ◽  
Aggregate Demand ◽  
Government Debt ◽  
The United States ◽  
United States Congress ◽  
Fiscal Stimulus ◽  
Goods And Services ◽  
Stimulus Package

Stimulus without debt is a policy that would increase aggregate demand for goods and services in a recession without increasing government debt. Stimulus without debt consists of a transfer (not loan) from the central bank to the national treasury (or to national treasuries in the case of the eurozone) so that the treasury does not have to borrow to finance fiscal stimulus enacted by the legislature. In the United States, Congress would enact a fiscal stimulus package that consists mainly of cash tax rebates to households but also other temporary expenditures and temporary tax cuts; the fiscal stimulus would raise aggregate demand. The Federal Reserve would use new money to give a large transfer (not loan) to the Treasury equal to the fiscal stimulus package so that the Treasury does not have to borrow to pay for the package. Hence, there would be no increase in government debt.

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