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ABI/Inform (Full Text)
- Two cheers for the Monetary Control Act
Katy Jacob, Daniel Littman, Richard D Porter, Wade Rousse.
Chicago Fed Letter. Chicago: Jun 2010. p. 1
Abstract (Summary)
There has been a great deal of discussion lately about the
Federal Reserve System and its role in providing financial
services. Since its founding in 1913 as the US' central bank
and monetary policymaker, the Fed has also played an important
role as a payments intermediary, providing check clearing
services to banks. However, until the Depository Institutions
Deregulation and Monetary Control Act (MCA) of 1980, the provision
of financial services by the Federal Reserve was largely based
on a club pricing arrangement: Member banks received all Fed
payment services for free, whereas nonmembers could not obtain
them from the Fed at any price. In terms of share of noncash
transactions, paper checks have been declining since the 1970s,
yet they are still the second-largest noncash payment type,
behind debit cards. The authors believe the Depository Institutions
Deregulation and Monetary Control Act of 1980 is the underlying
mechanism that helps nudge the Fed to remain on an efficient
payments path.
Full Text
Copyright Federal Reserve Bank of Chicago Jun 2010
There has been a great deal of discussion lately about die
Federal Reserve System and its role in providing financial
services. Since its founding in 1913 as die nation's central
bank and monetary policymaker, the Fed has also played an
important role as a payments intermediary, providing check
clearing services to banks (figure 1 ) . However, until the
Depository Institutions Deregulation and Monetary Control
Act (MCA) of 1980, the provision of financial services by
the Federal Reserve was largely based on a club pricing arrangement:
Member banks received all Fed payment services for free, whereas
nonmembers could not obtain them from the Fed at any price.2
Before the MCA, nonmembers had little access to Fed services
and used correspondent banks to get access for a fee (or compensating
balances) . Such a pricing arrangement led to some inefficiencies,
especially in the handling of checks.3 These inefficiencies
were coupled with relatively expensive paper check processing
systems that were beginning to seem outdated compared with
electronic payments processing. . . .
For full-text documents see ProQuest's ABI/INFORM
- Mobileinvestor.com; Ron Paul Says America's Anger Toward
Goldman Sachs Should be Directed At Federal Reserve Bank
Anonymous. Economics Week. Atlanta: May 28, 2010. pg. 118
Abstract (Summary)
Under the current laws the Federal Reserve Bank can monetize
all kinds of debt and making secret deals around the world
without having any accountability to the American people,
he said.
Full Text
(c)Copyright 2010, Economics Week via NewsRx.com
2010 MAY 28 - (VerticalNews.com) -- America's anger towards
Goldman Sachs would be better directed towards the Federal
Reserve Bank, which creates the credit, said Texas Congressman
Ron Paul during a candid interview with Jay Taylor on Mobileinvestor.com.
Paul who has been outspoken in his disapproval of the Federal
Reserve Bank claimed the organization of exists to take care
of big banks and companies like Goldman Sachs. . . .
For full-text documents see ProQuest's ABI/INFORM
- Senate Passes Finance Bill; Biggest Regulatory Overhaul
of Wall Street Since Depression Moves Closer to Law
Greg Hitt, Damian Paletta. Wall Street Journal (Online).
New York, N.Y.: May 21, 2010
Abstract (Summary)
Among other things, the legislation would: * Establish a new
council of "systemic risk" regulators to monitor growing risks
in the financial system, with the goal of preventing companies
from becoming too big to fail and stopping asset bubbles from
forming, such as the one that led to the housing crisis. *
Create a new consumer protection division within the Federal
Reserve charged with writing and enforcing new rules that
target abusive practices in businesses such as mortgage lending
and credit-card issuance. * Empower the Federal Reserve to
supervise the largest, most complex financial companies to
ensure that the government understands the risks and complexities
of firms that could pose a risk to the broader economy. *
Allow the government in extreme cases to seize and liquidate
a failing financial company in a way that protects taxpayers
from future bailouts. * Give regulators new powers to oversee
the giant derivatives market, increasing transparency by forcing
most contracts to be traded through third-parties instead
of only between banks and their customers.
Full Text
(c) 2010 Dow Jones & Company, Inc. Reproduced with permission
of copyright owner. Further reproduction or distribution is
prohibited without permission.
WASHINGTON--The Senate on Thursday approved the most extensive
overhaul of financial-sector regulation since the 1930s, hoping
to avoid a repeat of the financial crisis that hit the U.S.
economy starting in 2007.
The legislation passed the Senate 59 to 39 and must now
be reconciled with a similar bill passed by the House of Representatives
in December, before it can be sent to President Barack Obama
to be signed into law.
The controversial measure, supported by the Obama administration,
sets up new regulatory bodies and restricts the actions of
banks and other financial firms. It is designed to try to
make order of the cascading regulatory chaos that ensued in
2008 when mammoth banks and some unregulated financial firms
collapsed, and public funds were used to save them. . . .
For full-text documents see ProQuest's ABI/INFORM
- Treasury, Fed Work to Kill Capital Provision in Senate
Bill
Damian Paletta. Wall Street Journal (Online). New York,
N.Y.: May 19, 2010
Abstract (Summary)
WASHINGTON--Officials from the Treasury Department, Federal
Reserve and Wall Street are working to kill an amendment to
the Senate's financial regulations bill that was adopted unanimously
last week and that could force big U.S. banks to hold billions
of dollars in additional capital.
Full Text
(c) 2010 Dow Jones & Company, Inc. Reproduced with permission
of copyright owner. Further reproduction or distribution is
prohibited without permission. WASHINGTON--Officials from
the Treasury Department, Federal Reserve and Wall Street are
working to kill an amendment to the Senate's financial regulations
bill that was adopted unanimously last week and that could
force big U.S. banks to hold billions of dollars in additional
capital. This could also potentially complicate international
negotiations on banking rules. The amendment, written by Sen.
Susan Collins (R,. Maine) with backing from Federal Deposit
Insurance Corp. Chairman Sheila Bair, would force banks with
more than $250 billion in assets to meet higher capital requirements,
according to a summary provided by her office. The amendment
was passed with little fanfare and attached to the broader
financial-overhaul bill. The amendment is significant for
both political and practical reasons. . . .
For full-text documents see ProQuest's ABI/INFORM
Historical Newspapers
- A BANK OF BANKS
Wall Street Journal. New York, N.Y.: Sep 20, 1907. pg. 1
Abstract (Summary)
The best plan thus far presented for a central bank of reserve and issue in this country is that proposed by Ex-Director of the Mint George E. Roberts, now president of the Commercial National Bank of Chicago.
Original Newspaper Image (PDF)
- RESERVE POLICY NEW DEPARTURE; Board Forced to Recognize the Stock Market in 1929 Credit During Year
Wall Street Journal. New York, N.Y.: Jan 1, 1930. pg. 17
Abstract (Summary)
After the vagaries of the 1929 call money market have been forgotten, except as an interesting incident in an era of unprecedented speculation, the real heritage of the year in the credit world undoubtedly will be recognized as a new departure in Federal Reserve policy. For the first time in its history, the Federal Reserve Board was forced to take cognizance of the stock market, and eventually was induced to shape its policy accordingly, despite the fact that the security markets supposedly are entirely ouside the realm of Reserve dictum. The second feature of the year, as regards Reserve policy, was the interesting and much criticised experiment of using publicity as a direct weapon of enforcing its will.
Original Newspaper Image (PDF)
- Nominee Pledges to Fight Inflation And Restore Confidence in Dollar; Carter Nominates Volcker as Chief of Federal Reserve More Conservative Than Miller
By ROBERT A. BENNETT. New York Times (1923-Current file). New York, N.Y.: Jul 26, 1979. pg. A1
Abstract (Summary)
President Carter nominated Paul A. Volcker, president of the Federal Reserve Bank of New York and a leading figure in international financial circles, to be chairman of the Federal Reserve Board yesterday.
Original Newspaper Image (PDF)
Taken from ProQuest's Historical
Newspapers.
Dissertations
- Essays on pricing and monetary policy
by Karadi, Peter, Ph.D., New York University, 2010 , 166 pages Abstract (Summary)
The first chapter (joint with Adam Reiff) addresses the issue of business cycle asymmetries and their pricing consequences. Asymmetric inflation response to aggregate shocks is an identifying macro-prediction of state dependent pricing models with trend inflation (Ball and Mankiw, 1994). The chapter uses the natural experiment of symmetric value-added tax (VAT) changes in Hungary with highly asymmetric inflation responses to provide further evidence for state-dependent pricing and for the Ball-Mankiw conjecture. The chapter shows that while standard menu cost models underestimate the observed asymmetry, a model of multi-product firms that takes sectoral heterogeneity explicitly into consideration can quantitatively account for the inflation asymmetry observed in the data. The chapter implies that the real effects of negative monetary shocks can be substantial even in the standard Golosov and Lucas (2007) model if these additional factors are taken into consideration.
The second chapter (joint with Miklos Koren) provides a simple spatial model to explain the Balassa-Samuelson effect - an essential component in explaining the aggregation bias found in the first chapter. There are two sectors: manufacturing, which is freely tradable, and non-tradable services, which have to locate near customers in big cities. As countries develop, total factor productivity increases simultaneously in both sectors. However, because services compete with the population for scarce land, labor productivity will grow slower in services than in manufacturing. The model hence provides a theoretical foundation for the Balassa-Samuelson assumption that productivity growth is slower in the non-tradable sector than in the tradable sector. Empirical results confirm some key implications of the theory.
The third chapter (joint with Mark Gertler) develops a quantitative monetary DSGE model that allows for financial intermediaries that face endogenous balance sheet constraints. It uses the model to simulate a crisis that has some basic features of the current economic downturn. The model, then is used to quantitatively assess the effect of direct central bank intermediation of private lending, which is the essence of the unconventional monetary policy that the Federal Reserve has developed to combat the subprime crisis. It is shown numerically how central bank credit policy might help moderate the simulated crisis.
For full-text documents see ProQuest's Dissertations & Theses Database
- The relationship of federal budget deficits/debt and interest rates
by Holloway, Thomas M., Ph.D., Walden University, 2010 , 316 pages Abstract (Summary)
Higher interest rates have long-run and short-run impacts on the economy, including reduced capital formation and damaging impacts on housing. The problem addressed in this study is whether increasing federal budget deficits/debt put upward pressure on interest rates. Economic theory offers opposing views--a conventional view that rising deficits/debt put upward pressure on interest rates or, alternatively, a Ricardian Equivalence view that they do not. Empirical work in this study assessed the relationship using econometric tools, principally regression methods, and alternative measures of interest rates, alternative measures of the deficit/debt, and alternative time periods for analysis. The underlying data were mainly economic time series measures available from government sources, including the Federal Reserve. The findings of the study were mixed, but provided sufficient evidence that there is a significant relationship between deficits/debt and interest rates. Specifically, interest rates adjusted for inflation and long-term rates versus short-term rates appear particularly sensitive to movements in the deficit/debt in some periods, with debt tending to be slightly more predictive in an array of tests. The interest rates-deficit/debt relationship does not appear to be stable over time; however, in a prior period of sluggish economic performance, which has similarities to today, a significant relationship was found. Given current high deficits and rising debt, the implication of the study for social change is that there is policy urgency to quickly reverse the course of deficits/debt prospectively in order to support capital formation for future economic growth and protect the housing market for consumers.
For full-text documents see ProQuest's Dissertations & Theses Database
- The effects of monetary policy on U.S. regional employment, 1999--2004
by Chapman, Lynn C., Ph.D., George Mason University, 2009 , 217 pages Abstract (Summary)
During the 1999-2004 monetary tightening cycle there was a
significant disparity in employment growth across various
regions in the United States. At the national aggregate level,
the three major labor market theories do not provide a clear
explanation for this disparity in regional employment growth
rates. This is consistent with the fact that there continues
to be disagreement regarding the effect of monetary policy
across regions. According to Gerald Carlino at the Federal
Reserve Bank of Philadelphia, the standard view of monetary
policy is that it has a "single, uniform national effect"
throughout the country. Furthermore, "There is currently little
evidence on whether and to what extent monetary policy actions
have differential effects on regional economic activity."1
The analysis in this dissertation suggests how monetary policy can affect some regions in a distinctly different way than it affects other regions. Not only do the effects vary widely from region to region, but there are aspects of the effects that are predictable and potentially manageable at the regional level.
1 Gerald Carlino and Robert Defina, "The Differential Regional Effects of Monetary Policy," (The MIT Press, 1998), 572.
For full-text documents see ProQuest's Dissertations & Theses Database
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