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Feb 3, 2014

Bernanke arrives for first day on the job at Brookings

NEW YORK (Reuters) – Ben Bernanke, who stepped down as chairman of the U.S. Federal Reserve on Friday, checked into work Monday morning at his new job at the Brookings Institution, a centrist policy think tank based in Washington.

Bernanke, whose eight-year tenure atop the U.S. central bank was marked by financial crisis and policy experimentation in the face of the Great Recession, joins Brookings as a distinguished fellow in residence at its economic studies program, the institution said on Monday.

Feb 3, 2014

Bernanke to join U.S. policy think tank Brookings

NEW YORK (Reuters) – Former Federal Reserve Chairman Ben Bernanke will join the Brookings Institution, a politically centrist policy think tank based in Washington, beginning on Monday.

Bernanke, who stepped down as head of the U.S. central bank on Friday after an eight-year tenure marked by financial crisis and policy experimentation in the face of the Great Recession, will join as a distinguished fellow in residence at its economic studies program, Brookings said on Monday.

Jan 31, 2014

Fed draws criticism from abroad as emerging markets still reeling

MUMBAI/NEW YORK, Jan 31 (Reuters) – The Federal Reserve’s
decision to keep trimming its economic stimulus drew fire on
Friday as India’s central bank chief said Americans should be
more attuned to the global impact of their policies, and the IMF
called for vigilance given strains in financial markets.

The push-back came on Fed Chairman Ben Bernanke’s last day
on the job and two days after the U.S. central bank reduced the
pace of its huge asset purchase program. The Fed made the move
on Wednesday despite a bruising selloff in emerging markets that
was prompted in part by the prospect of less U.S. monetary
support.

Jan 31, 2014

Emerging-market drop hasn’t hurt U.S. prospects: Fed’s Williams

By Jonathan Spicer

(Reuters) – The recent drop in emerging markets and U.S. stocks has not hurt the growing momentum of the U.S. economy or its labor market, a top Federal Reserve official said on Friday, adding the Fed should not focus too much on “short-term developments.”

San Francisco Fed President John Williams, speaking on Fox Business television, said the U.S. central bank is nonetheless carefully monitoring emerging-market turmoil and discussed it at a policy meeting this week.

Jan 30, 2014
via MacroScope

A week before emerging-market turmoil, a prescient exchange on just how much the Fed cares

Photo

The last seven days has been a glaring example of fallout from the cross-border carry trade. That’s the sort of trade, well known in currency markets, where investors borrow funds in low-rate countries and invest them in higher-rate ones. Some $4 trillion is estimated to have flooded into emerging markets since the 2008 financial crisis to profit off the ultra accommodate policies of the U.S. Federal Reserve, Bank of Japan, European Central Bank and the Bank of England. Now that central banks in developed economies are looking to reverse course and eventually raise rates, that carry trade is unraveling fast, resulting in the brutal sell-off in emerging markets such as Turkey and Argentina over the last week.

The Fed’s decision on Wednesday to keep cutting its stimulus effectively ignores the turmoil in such developing countries. And while the Fed may well be right not to overreact, it makes one wonder just how much attention major central banks pay to the carry trade and its global effects — and it brings to mind a prescient exchange between some of the brightest lights of western economics, just a week before emerging markets were to run off the rails.

Jan 30, 2014

Analysis: Only time will define Bernanke’s crisis-era legacy at Fed

By Jonathan Spicer and Ann Saphir

(Reuters) – Ben Bernanke did not hesitate when asked whether he was confident that his signature response to the Great Recession would work.

“Well, the problem with QE is that it works in practice but it doesn’t work in theory,” the head of the U.S. Federal Reserve quipped earlier this month during his last public appearance.

Jan 30, 2014

Only time will define Bernanke’s crisis-era legacy at Fed

Jan 30 (Reuters) – Ben Bernanke did not hesitate when asked
whether he was confident that his signature response to the
Great Recession would work.

“Well, the problem with QE is that it works in practice but
it doesn’t work in theory,” the head of the U.S. Federal Reserve
quipped earlier this month during his last public appearance.

Jan 30, 2014

In Bernanke’s final act, Fed cuts stimulus despite market turmoil

WASHINGTON (Reuters) – The Federal Reserve on Wednesday decided to trim its bond purchases by another $10 billion as it stuck to a plan to wind down its extraordinary economic stimulus despite recent turmoil in emerging markets.

The action was widely expected, although some investors had speculated that the U.S. central bank might put its plans on hold given the jitters overseas.

Jan 29, 2014

Fed cuts stimulus as expected; Bernanke prepares to depart

WASHINGTON, Jan 29 (Reuters) – The U.S. Federal Reserve on
Wednesday announced a further $10 billion reduction in its
monthly bond purchases as it stuck to a plan to wind down its
extraordinary stimulus despite recent turmoil in emerging
markets.

Fed Chairman Ben Bernanke, who hands the central bank’s
reins to Vice Chair Janet Yellen on Friday, also adjourned his
last policy-setting meeting without making any changes to the
U.S. central bank’s other main policy plank: its longer-term
plan to keep interest rates low for some time to come.

Jan 29, 2014

Fed poised for $10 billion taper as Bernanke bids adieu

By Ann Saphir and Jonathan Spicer

(Reuters) – Turmoil in emerging markets and a month of disappointing job growth at home are unlikely to deter the Federal Reserve from trimming its bond-buying stimulus on Wednesday, as Ben Bernanke wraps up his last policy meeting at the helm of the U.S. central bank.

Overall signs of improvement in the U.S. economy suggest Fed officials will stay on track to cut monthly purchases of Treasuries and mortgage-backed securities by $5 billion each, bringing the total of their monthly asset purchases to $65 billion.