Correspondent, Chicago
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Jun 12, 2014
Jun 12, 2014
Jun 12, 2014

Fed should stop sending profits to Treasury, economist argues

SAN FRANCISCO, June 12 (Reuters) – The U.S. Federal Reserve
should suspend payments to the Treasury to avoid a potential
cash crunch when the time comes to raise interest rates,
according to former Richmond Fed policy adviser Marvin

Such a reversal in policy is critical to protecting the
Fed’s inflation-fighting credibility, Goodfriend said in an
interview Thursday, because otherwise the central bank will find
itself needing to print money to pay for its obligations as it
raises interest rates, an untenable situation in his view.

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    • About Ann

      "Coverage includes Federal Reserve regional banks, U.S. monetary policy, interest-rate futures markets, and financial exchanges and clearinghouses serving the derivatives marketplace, including CME Group."
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