A Quote by Michael H. Moskow
For me, appropriate policy means that we continue to reduce accommodation and return to a neutral federal funds rate
Related Quotes
Under a cold turkey strategy, at each policy meeting the Federal Open Market Committee would make its best guess about where it ultimately wants the funds rate to be and would move to that rate in a single step.
I think the actions taken by the (rate-setting) Federal Open Market Committee have been the appropriate actions. And I assume we will continue to take the appropriate actions, depending on what is happening with the data and the dynamics of the economy
But with a rate of return of 1.6 percent or less, or a negative rate of return, our children and our grandchildren, if we do not make changes, will in fact not have a secure retirement. Indeed, they will not have the funds when they go to retire to even minimally get by.
Our ability to predict how the federal funds rate will evolve over time is quite limited because monetary policy will need to respond to whatever disturbances may buffet the economy.
The rate of growth of the relevant population is much greater than the rate of growth in funds, though funds have gone up very nicely. But we have been producing students at a rapid rate; they're competing for funds and therefore they're more frustrated. I think there's a certain sense of weariness in the intellectual realm, it's not in any way peculiar to economics, it's a general proposition.
What central banks can control is a base and one way they can control the base is via manipulating a particular interest rate, such as a Federal Funds rate, the overnight rate at which banks lend to one another. But they use that control to control what happens to the quantity of money. There is no disagreement.
I must oppose the use of federal funds for a policy of killing infants.
Paying interest on reserve balances enables the Fed to break the strong link between the quantity of reserves and the level of the federal funds rate and, in turn, allows the Federal Reserve to control short-term interest rates when reserves are plentiful.
How can you raise the level of consciousness on this? How can you get the federal government to take the responsibility? Florida does not have a foreign policy. This is a federal policy or absence of federal policy. It's so clear that we're not being treated fairly. We have to come up with a solution. It hurts your head trying to figure out what to do.
A higher IOER rate encourages banks to raise the interest rates they charge, putting upward pressure on market interest rates regardless of the level of reserves in the banking sector. While adjusting the IOER rate is an effective way to move market interest rates when reserves are plentiful, federal funds have generally traded below this rate.
The central banks cannot control interest rates. That's a mistake. They can control a particular rate, such as the Federal Funds rate, if they want to, but they can't control interest rates.
And judging what is appropriate or not appropriate for a country, I think it is important in particular in judging what is the appropriate economic policy framework, one should take into account the overall political environment and the institutional framework within which economic policy operates.
All economic forecasts are subject to considerable uncertainty. There is always a wide range of plausible outcomes for important economic variables, including the federal funds rate.
[The Republicans] offer . . . a detailed agenda for national renewal. . . . [On] reducing illegitimacy . . . the state will use . . . funds for programs to reduce out-of-wedlock pregnancies, to promote adoption, to establish and operate children's group homes, to establish and operate residential group homes for unwed mothers, or for any purpose the state deems appropriate. None of the taxpayer funds may be used for abortion services or abortion counseling.
It's important for market participants to have a sense of how we think about the economy and the appropriate path of policy, to look at incoming data, and to form their own judgments as to whether or not changes in policy would be appropriate.
It's traditionally not federal policy to fund state and local salaries. It's done sometimes on a temporary basis or a grant basis. But it's not often done. And the reason is clear, because the federal government can't continue in perpetuity these programs.
