Earlier this week
...me to a recent essay by Edwin Truman with a very specific proposal about doing just that. Truman takes the very direct approach: The FOMC should temporarily shift its target from the overnight federal funds rate to the 3-month dollar LIBOR rate. If its...
...federal funds rate by 50 basis points to 1.5% and reduced the discount rate by an equal measure to 1.75%. While it is certain that the FOMC did not respond to the overnight deterioration in interbank markets, the move comes at a crucial time and almost...
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...can lead to broad macro weakness, a cut in the Fed Funds rate could be justified as a pre-emptive strike. The idea that the FOMC will cut rates Tuesday is supported by several economists. IFR Markets sees a quarter-point cut to 1.75%, ING at least that...
...Rate was also unchanged at 2.25%.  On the surface this was a disappointment based upon the financial meltdown we are seeing.  The FOMC isn't the one responsible for bailing out a bunch of greedy people who operated at 20-times leverage (or more) and this...
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