Sunday, November 9, 2008

Interesting Picks

I don't have many links today, but it's the Fed's fault- I just spent too much time on trying to understand both the quantity and price of the Fed's balance sheet, as the first two entries attest. But hopefully, you'll be getting some quality over quantity this time around...

I had been thinking I was confused by the Fed's balance sheet because of my lack of understanding. Thanks to Rebecca Wilder, I now know it's not me, it's the Fed. I guess the CBT is not the only central bank criticized for lack of transparency, at least the Turkish Central Bank hasn't been sued yet.

Great exchange between Econbrowser and News'n'Economics: James Hamilton explains the difference between the target and effective Federal funds rate with the participation of non interest receiving institutions in the overnight interbank market and to the new 0.75% FDIC insurance fee. Rebecca Wilder counters that the latter could not be the reason because of the details of the opt-out provision, to which James Hamilton agrees. But then, he wonders why the arbitrage opportunity of borrowing at 0.25% from a GSE and putting it at 1% (excess reserves) at the Fed would not push the effective funds rate higher. I am just another perplexes soul at this point, but Deutche's explanation of low Treasury yields, which FT Alphaville reports, might be part of the answer. But then this all boils down to saying that Fed's quantitative easing is well under way and/or that Fed is losing control of the monetary steering wheel. Or am I missing something? Anyway, Zulbin Jelveh summarizes the Hamilton and Wilder posts as well as providing some more insight with a couple of interesting charts.

MarketSci summarizes his blogs from last week on the relation between the Ted spread and the stock market.

Yet another recession indicator: The lipstick index (in fact, this isn't as crazy as it sounds; think of it as a micro version of the frugalizing we see in same store sales data). has made it a a tradition: After their advice to the G7/8,On the eve of the G20 meeting, they have published a new book on what the G20 leaders should do the save the economy and fix the financial system. Eichengreen and Baldwin introduce the collection of essays.

The end of Wall Street, from the author of Liar's Poker.


Anonymous said...

Probably you dont know anything about transparency of Turkish Central Bank. They have been disclosing detailed info by daily basis..
What are you looking for to know detailed?
Probably you are talking without knowlage?


Emre Deliveli said...

I didn't say "I am criticizing the CBT"; I merely mentioned that they have been criticized in the past for lack of transparency, which they have been by respected academics and Economics columnists alike. If you're interested, let me know and I can send you various examples.

But since you mentioned, I have also criticized the CBT on a particular issue, the use of their core indices- please see my post from Noveber 5th titled "Nine Measures of Inflation". There, I specify exactly I am looking for. I wish we lived in a world where "disclosing detailed info by daily basis" would be all it'd take for transparency...But it ain't, at least not for me...