Marcus Nunes | The answer is that much more is needed, especially since lately we´ve had the Fed and the ECB/BoJ pulling in opposite directions. Some policy coordination would greatly increase their productivity.
Brazil industrial production have been evolving according to the world average. For the past six years, however, it “dismounted from the world horse”.
They are right. That´s the way the Fed thinks. But it is dangerous and wrong! Insisting on the mistake will likely lead to another recession. Larry Kudlow (HT Lars Christensen) also rants on the Fed´s mistaken view.
Does central banks’ “communication” matter? Some analysts believe it does. Therefore, Draghi may now have to work to repair his reputation as “Super Mario”.
The Federal Reserve Board released an updated version of its large-scale model on the US economy that may hold clues into why policy makers pivoted at their meeting earlier this week toward a December interest-rate increase.
Compared to the US, Switzerland has been a low inflation country, but the recent turn to deflation smacks a lot of too low NGDP growth.
In December 1985, Thomas Sargent spent some time in Brazil, giving speeches and talking to policymakers. Back home in January 1986, he published in the WSJ an Open Letter to the Brazilian Finance Minister: …When you have exhausted all of your opportunities to borrow, you will have to make one or more of unpleasant adjustments such as taxes rises, government expenditures cuts or default on some of you debt…
The international consultative Group of Thirty (G30), whose members are central bankers and bankers from big private banks, has just released a report. They conclude much work remains ahead for governments and central banks to secure a solid recovery.
On the day that his book “Courage to Act” was released, on Monday, October 5, 2015, he wrote an op-ed at the WSJ “modestly” titled How the Fed Saved the Economy?.The central bank did its job. What about everyone else?
What really shocked the markets was not the Fed’s decision to maintain zero interest rates for a few more months, but the statement that accompanied it.